DOING BUSINESS IN EQUATORIAL GUINEA IN 2022
Since 2003, Healy Consultants Group PLC has assisted our Clients with forming their company in Equatorial Guinea. Our services include i) Equatorial Guinea business registration ii) government license registration iii) corporate bank account opening services in Equatorial Guinea iv) recruitment services v) visa strategies and vi) office rental solutions.
Summary table of Equatorial Guinea company registration
|Summary||Limited Liability Company||Small and Medium Enterprises||Oil and gas company||Fast business setup company||Tourism company||Branch office|
|Also known as||SARL||Petites et moyennes entreprises||Compagnie pétrolière et gazière||Société de configuration d'entreprise rapide||Société de tourisme||Succursale|
|Best use of company?||All products and services||Hydrocarbons, logistics and other SMBs||Oil exploration and trading||All products and services||Tourism development and related services||Professional services|
|How soon can you invoice Clients\sign sales contracts?||16 weeks||16 weeks||18 weeks||2 weeks||16 weeks||20 weeks|
|How soon can you hire staff?||16 weeks||16 weeks||18 weeks||2 weeks||16 weeks||20 weeks|
|How soon can you sign a lease agreement?||2 weeks||2 weeks||2 weeks||2 weeks||2 weeks||2 weeks|
|How long to supply corporate bank account numbers?||4 weeks||4 weeks||4 weeks||1 week||4 weeks||6 weeks|
|How long to supply company registration \ tax numbers?||16 weeks||16 weeks||18 weeks||2 weeks||16 weeks||20 weeks|
|Corporate tax rate on annual net profits?||35%||0%||35%||35%||35%||35%|
|Limited liability entity?||Yes||Yes||Yes||Yes||Yes||No|
|Government grants/incentives available?||Yes||Yes||Yes||Yes||Yes||Yes|
|Government approval required for foreign owners?||No||No||No||No||No||No|
|Resident director/partner/manager/ legal representative required?||Yes||Yes||Yes||Yes||Yes||No|
|Minimum paid up share capital?||US$2,000||US$2,000||US$2,000||US$2,000||US$2,000||US$1|
|Can bid for Government contracts?||Yes||Yes||Yes||Yes||Yes||Yes|
|Corporate bank account location?||CCEI Bank||Banco Nacional de Guinea Ecuatorial||Commercial Bank Guinee Equatoriale||SGBGE Bank||African Development Bank||BGFI Bank|
|Can secure trade finance?||Yes||Yes||Yes||Yes||Yes||Yes|
|VAT payable on sales to local customers?||15%||15%||15%||15%||15%||15%|
|Average total business set up engagement costs?||US$22,200||Request a proposal||Request a proposal||Request a proposal||Request a proposal||US$23,850|
|Average total engagement period?||5 months||5 months||6 months||3 weeks||5 months||7 months|
Equatorial Guinea company registration summary
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Advantages of Equatorial Guinea company registration
- Registration of a limited liability company (LLC) in Equatorial Guinea requires i) a minimum of one shareholder and one director of any nationality and ii) minimum paid-up capital of US$2,000. Our Client will not have to travel to Equatorial Guinea to complete the process;
- The tax regime in Equatorial Guinea allows new companies to have the opportunity to benefit from tax holidays on corporate income tax during up to 15 years;
- Equatorial Guinea has experienced a tremendous boom in oil and gas production and is ranked as the 6th largest oil producer in Africa producing about 346,000 barrels of oil per day. This explains why the country’s economy is the relatively more developed than its neighbors’, with the second highest GDP per capita within Subtropical Africa;
- Equatorial Guinea is in the process of development and therefore there is need for i) technical support ii) training of local workers iii) consumer goods iv) infrastructure development in order to improve the standard of living of the entire country;
- Equatorial Guinea is a member of the Central African Economic and Monetary Community (CEMAC) which promotes cooperation and business among member countries. Repatriation of funds and profits among member states is not subject to restrictions and does not require any prior government approval;
- The government had launched the National Development Horizon: 2020 initiative beginning from 2008 and ending in 2020 in the Equatorial Guinea. This initiative aims at i) economic diversification through promoting the sectors of fishery, agriculture, financial and tourism services, ii) poverty reduction as well as iii) infrastructural development in the nation by the year 2020.
Disadvantages of Equatorial Guinea company registration
- Corporate tax in Equatorial Guinea is high at the rate of 35% on all corporate profits. VAT is levied at the rate of 18%;
- Foreigners forming a company in Equatorial Guinea will face the typical difficulties encountered by Subtropical Africa businesses, including:
- Businesses formed in Equatorial Guinea suffer from a lack of business opportunities due to a population of less than 1 million inhabitants. 60% of them furthermore live in the countryside;
- In spite of the oil boom in Equatorial Guinea, 60% the population lives below poverty line and hence cannot afford to buy imported products;
- The local administration is very inefficient and corrupt. According to the World Bank, it takes for instance an average of 5 months to start a business in Equatorial Guinea;
- There are only three banks in Equatorial Guinea and they are controlled by the government. Entrepreneurs are unable to access financing due to high interest rates and lack of loan facilities.
- The national language of Equatorial Guinea is French. All business documents are therefore required must be translated into this language prior to incorporation. As most of the population is French-speaking, investors will also encounter communication problems with employees as well as Clients and suppliers when running their business in Equatorial Guinea.
- In accordance with Equatorial Guinea regulations, all foreign-owned Equatorial Guinea LLCs must have i) 35% of their shares held by Equatorial citizens and ii) one third of their directors must also be Equatorial Guinea citizens. Consequently, most of our Clients prefer to register a branch of their foreign business in Equatorial Guinea. Alternatively, Healy Consultants Group PLC can assist our Clients find nominee shareholders and directors to meet the above requirement;
- Equatorial Guinea has been poorly ranked as the 175th freest economy (out of 180 countries) in the 2018 Index of Economic Freedom. Moreover, it has been ranked 45th out of 47 countries in the Sub-Saharan African region in terms of its economic freedom. This is largely due to i) high levels of poverty in the nation due to uneven economic growth, ii) presence of weak institutions in the country which further deters the growth of its private sector and iii) tight regulations and bureaucratic hurdles in different sectors of the economy.
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