DOING BUSINESS IN BURKINA FASO IN 2020
Since 2003, Healy Consultants Group PLC has assisted our Clients with business registration in Burkina Faso. Our services include i) Burkina Faso company incorporation ii) government license registration iii) business bank account opening iv) employee recruitment v) visa strategies and vi) office rental solutions.
Summary table of Burkina Faso company registration
|Summary||Tax resident LLC||Fast business setup solution||Joint venture LLC||Representative office||Branch office|
|Also known as||Société à Responsabilité Limitée||Société à Responsabilité Limitée||Société à Responsabilité Limitée||Bureau de représentation||Succursale|
|Best use of company?||All products and services||Close a customer deal now||Restricted industries||Marketing & research||Specific projects|
|How soon can you invoice Clients/sign sales contracts?||4 weeks||3 weeks||4 weeks||5 weeks||5 weeks|
|How soon can you hire staff?||4 weeks||3 weeks||4 weeks||5 weeks||5 weeks|
|How soon can you sign a lease agreement?||2 weeks||2 weeks||2 weeks||2 weeks||2 weeks|
|How long to supply corporate bank account numbers?||2 months||4 weeks||2 months||2 months||2 months|
|How long to supply company registration / tax numbers?||4 weeks||3 weeks||4 weeks||5 weeks||5 weeks|
|Corporate tax rate on annual net profits?||27.5%||27.5%||27.5%||Cannot trade||27.5%|
|Limited liability entity?||Yes||Yes||Yes||No||No|
|Government grants available?||Yes||Yes||Yes||No||Yes|
|Government approval required for foreign owners?||No||No||No||No||No|
|Resident director/partner/manager/ legal representative required?||No||No||Yes||Yes||Yes|
|Minimum paid up share capital?||US$45||US$45||US$45||US$1||US$45|
|Can bid for Government contracts?||Yes||Yes||Yes||No||Yes|
|Corporate bank account location?||Bank of Africa||Atlantic Bank||Ecobank||BSIC||Société Générale Burkina Faso|
|Can secure trade finance?||Yes||Yes||Yes||No||Yes|
|VAT payable on sales to local customers?||18%||18%||18%||Cannot trade||18%|
|Average total business set up engagement costs?||US$15,300||Request a proposal||Request a proposal||Request a proposal||US$17,450|
|Average total engagement period?||2.5 months||2 months||2.5 months||3 months||3 months|
Burkina Faso business setup summary
Advantages of Burkina Faso company registration
- A limited liability company in Burkina Faso can be incorporated with a minimum of one shareholder and one director of any nationality. The minimum paid-up capital required for incorporation is US$2,000 and our Client will not have to travel to Burkina Faso to complete the process;
- The government of Burkina Faso has established a one-stop-shop (CEFORE) for company registration which has greatly reduced the amount of time taken to complete the registration process of a new company in Burkina Faso;
- Burkina Faso is a member of the CFA Franc Zone and as a former French colony, the French Treasury guarantees the convertibility of the currency used in the country which is the CFA Franc. The exchange rate has been pegged to the Euro at €1 for CFA Franc 655.957 since 2009. This in turn stabilizes prices and reduces costs on foreign borrowing and lowers transaction costs for investors;
- Business setup costs as well as labour costs and other secondary costs such as office space are amongst the lowest in Sub-Saharan Africa, for example the annual average wage in Burkina Faso is US$860;
- Burkina Faso has been consistently improving its business environment and is currently the 111th largest export-oriented economy in the world. The economy has structurally transformed and diversified its cotton industry, resulting in an export worth US$506 million of raw cotton in 2016. Moreover, the nation witnesses substantial exports of gold. In 2016, it exported gold worth US$3.02 billion to other nations.
Disadvantages of Burkina Faso company registration
- Being a landlocked country, Burkina Faso relies mostly on imports travelling through the ports of its neighboring countries. Investors must therefore remember that any issues in neighboring countries that cause delays at ports can have a negative impact on business in Burkina Faso, especially for companies that depend on imports.
- French is the national language of Burkina Faso therefore all business documents must be translated into French prior to incorporation of a company and thus language is a barrier for foreign investors when doing business;
- Transparency International’s Corruption Perceptions Index 2014 negatively ranks Burkina Faso as 85th least corrupt country meaning corruption is still a widespread problem in Burkina Faso and therefore obtaining necessary licenses to do business is costly and time-consuming. Healy Consultants will be happy to help you handle your administrative requirements;
- Corporate tax in Burkina Faso is quite high at the rate of 27.5% on all corporate profits. Branches of foreign companies have to pay an additional 12.5% withholding tax on remittances and VAT is levied at the rate of 18%;
- Burkina Faso has been ranked as the 95th freest economy (out of 180 economies) in the 2018 Index of Economic Freedom. This is majorly due to the lack of investment freedom as well as labour freedom of this Sub-Saharan South African nation. Additionally, the government of the nation has a poor fiscal health along with a weak rule of law which further hinders the economy to function freely.
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