The registration of foreign companies in Libya is still regulated by the Libyan commercial law 23/2010 and Ministry of Economy decree 207/2012. These laws regulate the form of incorporation and the sectors available for foreigners to start a business in Libya. in this article we will address the options available for foreigners who are thinking about establishing a legal presence for their business in Libya or to entering the Libyan market.
This option is the most favorable to foreigners who are looking to establish a legal presence and register their company in Libya where establishing a company branch in Libya will give the foreign company 100% control over the entity in Libya.
The minimum capital investment required for registering a foreign company branch in Libya is 250,000 Libyan Dinar (Approx. 55,000 US Dollars, Jan-22 rate), and the registration could be granted for a period of one, three or five years. There are certain activities that are permissible to incorporate and register the company branch under, these activities and categories are listed in MoE decree 207/2012, to know ore about these activities and the feasibility of registering your company in Libya, please get in touch with us here.
Albeit the branch would be 100% owned by the foreign company, there is a regulatory requirement that the branch manager of its deputy must be a Libyan national. Our firm may assist in fulfilling this requirement. Please check our corporate services and Get in Touch with us to know more about other requirements, documents needed, governmental fees, etc.
Joint Venture Company
According to MoE decree 207/2012, a foreigner may establish a legal presence in Libya and enter the Libyan market by establishing a joint venture company with a Libyan partner. The restrictions for such form of incorporation are mainly about the ownership, where according to the law, Libyan ownership in JV companies must be a minimum of 51% , in addition, the majority of the company’s board of directors as well as its director, must also be Libyan nationals.
The minimum capital investment required of 1 million Libyan Dinars (LD) of which a 1/3 must be paid before incorporation.
Under Investment Law Company
It is permissible to have your company registered in Libya and run your business under the provisions of Investment Law 9/2010. However, there are certain sectors that will make your company eligible for registration under Libyan investment law.
Such registration will grant the investor facilitations represented in tax and customs exemptions. To know more about the eligibility of registering your company in Libya under investment law, please get in touch with us here.
Registering as a representative office of a foreign company is a form that is mainly used by the banking sector. where many international banks are using this form to have a representation in Libya and to coordinate and market their operations and services outside of the country.
However, many other companies whose their goal is not to acquire local contracts or to make money in Libya are using this form of incorporation to legally represent their companies and conduct marketing activities in Libya.
For more information about having a representative office in Libya, please get in touch with us here.
Operating through a Libyan Distributor/Commercial Agent
In Libya, foreign investors can work through a Libyan agent, who should be an authorized commercial agent. The potential agent needs to obtain permission from the competent authority (the Ministry of Economy) to operate in Libya. The agent must be licensed and registered with the Commercial Agency Department in the Ministry of Economy.
There are no restrictions on the areas permitted to foreign companies in this form. The only principle is that the entity must be a licensed entity in its jurisdiction and to be the same entity which enters into an agency agreement with the local agent.
Establishing a Company in the Free Zone
According to Law no 9 of 2000 in relation to organizing transit of goods & free zones and its regulations, several Free zones were incorporated in Libya some of them are currently active like Misurata Free Zone (MFZ) located in Misurata City.
Some activities are permissible by MFZ, these activities could be reviewed at there website here. If you think this would be a suitable option to register your company in Libya, then we may contact MFZ on your behalf and conduct preliminary research to confirm the eligibility of registration the requirements., please get in touch with us here.
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