Business entities in Paraguay

Business entities in Paraguay

Paraguay business entitiesHealy Consultants will assist our Clients with incorporating the entity that best fits their business needs. The most common business entity in Paraguay is the LLC. Foreign companies can also establish a PLC, a Branch Office or a Representative Office in Paraguay.

The Paraguay LLC (SRL)

  • A Paraguay LLC requires at least of 2 shareholders and 1 director who must either be temporarily or permanently resident in Paraguay. The are no minimum nor maximum paid up capital requirements;
  • A corporate contract must be recorded at the Public Registry before the LLC begins operation. The companies are not compelled to register as commercial entities but failure to register may create unlimited responsibility of all the partners toward third parties;
  • The company’s capital is divided into nominal quotas of US$1 and indicated on the contract of incorporation. The capital can also be incorporate in fixed assets or goods.

The Paraguay Public Limited Company (SA)

  • PLC’s in Paraguay must include the denomination “SA” (Sociedad Anonima). A Paraguayan SA requires i) at least two shareholders and one director who must be resident in Paraguay ii) a completely subscribed capital stock and iii) a recorded authorization at the Public Records from the courts; There are no minimum share capital requirements;
  • This particular entity is preferred mostly by foreign investors looking to set up large enterprises in Paraguay.

The Paraguay branch office

  • Foreign companies willing to conduct regular businesses in Paraguay are permitted to establish a branch office in Paraguay. Like the Paraguayan companies, the Branch offices are subject to provisions of the Paraguayan Civil Code regarding the registration and the publication of corporate documents at the Registry of Legal Entities and Associations and the Public Registry of Commerce;
  • At least one director who must be resident in Paraguay and a minimum paid up capital of US$25,000 is required to establish a branch office;
  • The Paraguayan company law allows 100% foreign ownership of branches of foreign companies incorporated in Paraguay.

The Paraguay representative office

This entity, just like the branch office, can be 100% foreign owned and is required to have at least one resident director in Paraguay. A minimum paid up capital of US$25,000 is also required when setting up a representative office.

Table of comparison between Paraguay entities

 LLCPLCBranch officeRep office
How long to set the company up?10 weeks12 weeks12 weeks10 weeks
How long to open company bank account?4 weeks4 weeks4 weeks4 weeks
Legal liability?LimitedLimitedUnlimitedUnlimited
Wholly foreign owned?YesYesYesYes
Minimum capital required?US$1US$1US$25,000US$25,000
File annual tax return?YesYesYesYes
Tax registration certificate required?YesYesYesYes
Recommended corporate bank account?Continental BankNational Bank of ArgentinaAtlas BankGNB Bank Paraguay
Does our Client need to travel?NoNoNoNo
Resident director required?YesYesYesYes
Resident shareholder required?NoNoNoNo
Minimum directors allowed?1111
Minimum shareholders?22NANA
Tax identification code (TIN) needed?YesYesYesYes
Paraguay resident company secretary required?NoNoNoNo
Corporate shareholders allowed?YesYesYesYes
Corporate director(s) allowed?NoYesNoNo
Paraguay corporate tax rate?10%10%15%15%
Annual financial statements required?YesYesYesYes
Statutory audit required?NoNoNoNo
Regulated by?Ministry of Industry and CommerceMinistry of Industry and CommerceMinistry of Industry and CommerceMinistry of Industry and Commerce
Allowed to issue sales invoices?YesYesYesYes
Allowed to sign contracts?YesYesYesYes
Allowed to import and export goods?YesYesYesYes
Can rent an office space in Paraguay?YesYesYesYes
Can buy Paraguay property?YesYesYesYes
Can own equity in other Paraguay companies?YesYesYesYes
Total Paraguay business setup costs in Yr. 1US$12,850US$14,550US$13,450US$13,450
Subsequent annual costs (incl. accounting and tax fee)US$4,400US$4,400US$4,400US$4,400
Sample engagement invoiceParaguay LLC setup costParaguay PLC invoiceParaguay branch invoiceParaguay Rep office invoice

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Contact us

For additional information on our business setup services in Paraguay, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Ms. Chrissi Zamora, directly: