SETTING UP OF A BUSINESS IN ANGOLA

INTRODUCTION

Angola stands out as a promising destination for entrepreneurs. Starting a business overseas offers immense opportunities for expansion and with Angola’s position as Africa’s sixth-largest economy, a population of 33 million, and a Gross Domestic Product (“GDP”) of USD 74 billion, it provides a fertile ground for business growth. The country showed a 2.9% economic growth in 2022 which further underscores its potential for new ventures. In addition to its large market and favourable demographics, the Angolan government actively supports new businesses through grants and policies. Businesses receive several tax benefits as well. The Angola Domestic Legislation takes care of taxation in Angola.

TYPES OF BUSINESS ENTITIES IN ANGOLA

There are 4 types of business entities in Angola –

1. The Angolan Limited Liability Company (LDA)– The Angolan Limited Liability Company (“LLC”) is the most used business entity that foreign entrepreneurs use when incorporating a company in Angola. Capital is divided into quotas and shareholders are jointly liable for the investments they make. An Angolan LLC must appoint 1 director and 2 shareholders and does not require a minimum paid-up share capital.
   
   
2. The Angolan Public Limited Company (SA)– This company setup will require at least 5 shareholders and 3 directors for the company to be incorporated. The minimum paid-up share capital required is US$ 20,000, 30% of which must be fully paid before the incorporation of the company. All public limited companies are required to go through an annual audit and appoint a board of directors for this purpose. The board of directors should have a minimum of 3 members.
   
   
3. The Angola Branch Office (Sucursal)– The Angola Branch Office setup requires a local resident to be appointed as the entity’s representative in the country. The scope of operations of a branch office is defined by the parent company. However, it has an independent management team and corporate bank account based in Angola.
   
   
4. The Angolan Representative Office (Escritório de representação)- An Angolan representative office is set up for the purpose of market research, promoting the business of the foreign firm it represents, etc. A representative firm is not allowed to pursue production-related or commercial activities and can only have a maximum of 6 employees, with a 50% quota for foreign employees. The company must deposit an amount of US$60,000 as a performance bond guarantee in an Angola corporate bank account.

PROCEDURE

Step 1: Gathering the required documents- After deciding on the type of business entity to be established, the next step is to collect all necessary documents for incorporating the business in Angola. The document requirement varies for every type of business entity.

Step 2: Paying the Company Registration Fee- A registration fee needs to be paid to the Register of Trade. The fee also varies according to the chosen business structure. This step also provides with the company’s Articles of Association and Memorandum.

Step 3: Acquiring the Company’s Tax ID- The Register of Trade then issues a tax identification number, which is crucial for completing the company’s registration process.

Step 4: Notarizing Company Documents- All documents are then submitted to public to a public notary for review and further forwarded to the Ministry of Commerce for formal approval.

Step 5: Company Registration Approval- Once the Ministry of Commerce reviews and approves the documents of the company, they issue a registration certificate.

Step 6: Opening a Corporate Bank Account- Using the tax identification number obtained earlier, entrepreneurs must establish a corporate bank account to handle all business transactions in Angola.

RULES FOR FOREIGNERS SETTING UP COMPANIES IN ANGOLA

Foreigners can start a business in Angola only when they have a proper visa and work permit. People setting up a company in Angola concerning fishing, industrial, and commercial industries need a type D visa. Foreign nationals belonging to the construction or petroleum industry should possess a type C visa. To get the work visa, one needs to submit specific documents to the Social Security, Ministry of Public Administration and Employment.

GOVERNMENT ASSISTANCE FOR FOREIGN-OWNED BUSINESSES

The government provides beneficial grants for starting a business in Angola. Angola has a Micro-grant program that aims to help entrepreneurs and provide them with monetary aid in doing business.

CONCLUSION

Establishing a business in Angola offers foreign entrepreneurs a significant opportunity for growth in a rapidly developing country. With benefits of a robust population, increasing GDP, and governmental support through grants and tax benefits, Angola presents an extremely conducive environment for new businesses. Entrepreneurs can choose from multiple business structures, each catering to different operational needs. With these benefits, Angola becomes a strategic location for setting up a new business.