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Home , Equatorial Guinea, OHADA

doing business in Equatorial

country profile international and memberships government  Executive: The president is chief of state and the prime minister is the international  African Continental Free Trade Area Agreement structure head of government. The president is elected by simple majority popular and regional  Group vote for a period of seven years and is eligible for a second term. The organisations  prime minister, deputy prime ministers and cabinet are appointed by the and customs  Bank of Central African States (Banque des États de l’Afrique Centrale president. unions (“BEAC“))  Legislative: has a bicameral National Assembly.  Community of Countries  Judicial: The highest courts are the Supreme Court of Justice and the  Development Bank of the Central African States Constitutional Court. The subordinate courts are Court of Guarantees,  Economic and Monetary Community of Central (Communauté military courts, Courts of Appeal, first instant tribunals, and district and Économique et Monétaire de l’Afrique Centrale (“CEMAC“)) country tribunals.   Next presidential elections: April 2023.  International Fund for Agricultural Development economic  Nominal GDP (USD billions): 12.26  International Monetary Fund data  GDP per capita (USD): 8 720.25  International Organization of the French-speaking  Inflation rate (% change): 2.66  Organisation of African, Caribbean and Pacific States Organization for the Harmonization of Business Law in Africa (“OHADA”)  Government revenue (% of GDP): 17.03   Government gross debt (% of GDP): 36.99  United Nations  Group *Source: IMF (May 2020)  Equatorial Guinea receives preferential treatment under the following agreements: http://ptadb.wto.org/Country.aspx?code=226  Equatorial Guinea’s economy is mainly driven by oil and gas with bilateral  Equatorial Guinea has bilateral investment treaties in force with , agriculture also playing a role in the economy. Key agricultural products investment , Russia and . include , cocoa, rice, yams, cassava, bananas, palm oil nuts, treaties  Treaties have been signed with , , , , livestock and timber. and the but these have not yet entered into  Undeveloped mineral resources include gold, zinc, diamonds, columbite- force. tantalite and other base metals.  Equatorial Guinea’s main export partners are China, , , investment-  Cotonou Agreement Portugal, the United States and Spain. The main export commodities related  Multilateral Investment Guarantee Agency include products and timber. agreements /  World Trade Organization (observer)  Equatorial Guinea’s main import partners are Spain, China, the United institutions States, and the Netherlands. The main import commodities include petroleum sector equipment, other equipment, construction dispute  OHADA materials and vehicles. resolution  United Nations Commission on International Trade Law (UNCITRAL)

risk ratings  World Economic Forum Global competitiveness index (2019): N/A intellectual  A comprehensive list of IP-related treaties signed by Equatorial Guinea is  World Bank ease of doing business (2020): 178/190 property (“IP”) available at: http://www.wipo.int/wipolex/en/profile.jsp?code=GQ  Corruption perception index (2019): 173/180 treaties  See the trade marks section below for further detail.

1 doing business in Equatorial Guinea

legal regime fixed-term  Fixed term contracts are allowed in terms of the National Labour Law. applicable legal  Equatorial Guinea’s legal system is based on Spanish and local customary contracts and regime law. temporary  In theory, commercial law has undergone significant change due to the country's adoption of the OHADA body of business legislation, which services aligns Equatorial Guinea with the French-based legal systems of a number payment in local  Remuneration must be paid in local currency. of its francophone neighbours. currency foreign investment regime dispute  The OHADA provides for an arbitration procedure. Disputes relating resolution to the general uniform acts, or indeed any other business dispute, can be investment  A one-stop shop was established in 2019 to act as the official agency submitted to the OHADA arbitration procedure. All national legislation has regime where all the formalities for company registration are to be carried out. been superseded by the uniform act on arbitration. registration /  There is no specific registration at an investment authority, but the general land  All land belongs to the state. This gives the state a wide mandate to be licensing non-industry specific registration / licences as set out below are required. acquisition, able to take possession of land whenever it is in the sovereign interest to requirements planning and do so. non-industry use  Equatorial Guinean law provides for compensation if property is taken by specific the government. registrations / licences competition  There is currently no operational competition law regime in Equatorial Guinea. Department of  Entrepreneurs must register a company at the Department of Business  Equatorial Guinea is a member of the regional competition body CEMAC Business and and Private Investment at the Ministry of Commerce. and, as such, activities in Equatorial Guinea must be conducted with this Private  An annual fee is charged, which varies per company. in mind. Investment at  Equatorial Guinea is governed by OHADA uniform acts, however, OHADA the Ministry of has not yet released a Uniform Act pertaining directly to competition law. Commerce Department of  Entrepreneurs must register a company at the Department of Commerce employment Commerce at at the Ministry of Commerce. immigration  Expatriates, other than United States citizens, working in Equatorial the Ministry of  An annual fee is charged, which varies per company. Guinea must hold a valid work permit and a residence permit. These Commerce permits are valid for one year and are renewable. Tax Authority  Companies must be registered with the Tax Authority and obtain a tax  A work permit for an expatriate employee will not be issued by the Ministry identification number (“NIF”). of Labour unless a formal written labour contract is filed with the Ministry.  Registration with the Tax Authority is also available at the one-stop shop.  Equatorial Guinea has five types of work permits:  Permit A (“PA”) is granted to an employee who will work in a single work location for less than six months. It is not renewable. Ministry of  Employers must register with the Ministry of Labour and obtain a  Initial Permit B (“IPB”) is granted to an individual who will engage in Labour registration number from the Ministry. an established profession, working place or activity. It is valid for one  Upon application, the employer obtains an inspection book and labour year. calendar.  Permit B Renewed (“PBR”) is granted to individuals holding IPB at  Once operational, the employer and employees must contribute to the the end of the validity period of the IPB. It is valid for two years. Workers Protection Fund (Fondo de Protección del Trabajador). See the  Permit C (“PC”) is granted to individuals holding PBRs at the end of tax section below for further detail. the validity period of the PBR. It is valid for three years.  Permanent Permit (“PP”) is granted to individuals holding PCs at the end of the validity period of the PC.

2 doing business in Equatorial Guinea

National Institute  All new businesses must obtain social security numbers for the company's private limited liability company of Social employees. minimum  SARL | SA | SAS: A minimum of one shareholder is required. Security  The company must register its employees for social security in the first number of  In principle, local shareholders are not required, but may be required in (Instituto de month that the employees receive a salary. shareholders certain specified sectors such as mining, oil and gas. Seguridad Social minimum share  In terms of the OHADA Uniform Act on Commercial Companies and (“INSESO”)) capital Economic Interest Groupings, the following minimum share capital requirements apply: industry-  Industry-specific licences may also be required. specific  SARL: at least F.CFA1-million, which shall be divided into equal licences shares whose face value may not be less than F.CFA5 000.  SA: F.CFA10-million, divided into shares with a face value of not incentives  Incentives include: less than F.CFA10 000.  benefits under the Investment Code for companies whose centre of  SAS: no minimum required share capital, but in practice F.CFA10- main activities is in non-littoral areas; and million.  specific benefits granted to companies making strategic investments. directors  SARL: must have at least one managing director (gérant). It is exchange  Equatorial Guinea is a member of CEMAC and subject to the CEMAC recommended that someone who is either based in or regularly travels to control Currency Exchange Regulation No. 02/18/CEMAC/UMAC/CM. be appointed as managing director, as it is required for such a regulation  In terms of the CEMAC Regulations: person to hold a long term visa. There is no requirement to appoint  the foreign exchange regulations do not apply to transactions directors / managers in addition to the managing director. between member states of the CEMAC; nor do they apply to the  SA: must appoint a chairman of the board who can also act as general zone, except for measures relating to gold, some loans, direct manager of the company (directeur général). A board of directors with investments and transactions in foreign securities; three to 12 members, including a chairman, is to be appointed.  all other payments can be made freely, subject to a statement for  SAS: free to determine its management structure, which should, as a statistical purposes and presentation of the intermediary’s approved minimum, consist of one chairman. There is no requirement to appoint a supporting documents for amounts that exceed F.CFA1-million per board of directors. month; and  the transfer of funds abroad exceeding F.CFA100-million requires company  There is no requirement to appoint a company secretary in Equatorial declaration to the BEAC and to the relevant finance ministry at least secretary Guinea. 30 days before completion. auditor  SARL and SAS: must appoint a statutory auditor when two of the following types of  The forms of doing business available in Equatorial Guinea are mainly the three conditions are met at the end of the financial year: entities following provided for by the OHADA Uniform Act on Commercial  its total balance sheet exceeds F.CFA125-million; available for Companies and Economic Interest Groupings:  the annual turnover exceeds F.CFA250-million; or foreign  public limited company (société anonyme, SA);  the permanent staff exceeds 50 employees. investment  simplified limited lability company (société par actions simplifiée,  SA: appointment of an auditor is mandatory. SAS);  private limited liability company (société à responsabilité limitée, registered  Every company shall have a registered office which shall be indicated in SARL); address the Articles of Association.  general partnership (société à nom collectif, SNC);  The address of the company’s accountants or lawyers may be used as  limited partnership (société en commandite simple, SCS); registered address for an interim period.  joint venture (société en participation); shelf  Shelf companies are not available in Equatorial Guinea.  de facto partnership (société de fait); companies  economic interest grouping (groupement d’intérêt économique, GIE);  registered branch of a foreign company; and  representation or liaison offices.

3 doing business in Equatorial Guinea

registration  Companies are registered with the Commercial Registry (Registro de la transfer pricing  Equatorial Guinea does not have specific transfer pricing rules, but does process Propiedad y Mercantil) and it takes approximately 30 working days to have general rules prohibiting the direct or indirect transfer of income to an complete registration once all the required documents have been affiliated company by increasing or reducing purchase prices. submitted. limitations on  There are no thin capitalisation rules applicable in Equatorial Guinea. tax interest  However, interest paid on shareholder loans are only deductible under the tax system  Equatorial Guinea has a residence-based tax system in terms of which deductibility following conditions: residents are subject to tax on their world-wide income, whereas non-  the interest is deductible up to the lending rate of Equatorial residents are subject to tax only on their Equatorial Guinea-sourced Guinean commercial banks at the time the interest payments were income. due; and  for controlling shareholders, the loan may not exceed the share corporate  A company is resident in Equatorial Guinea if: capital. residence  it is constituted according to Equatorial Guinean laws;  its head office is located in Equatorial Guinea; or employee taxes The income tax rates applicable to resident individuals are:  its place of effective management is located in Equatorial Guinea. annual chargeable income (F.CFA) tax rate corporate tax  Resident companies and permanent establishments of foreign companies Up to 1 000 000 0% rate are subject to corporate income tax at the rate of 35%. 1 000 001 – 3 000 000 10%  A minimum tax (Cuota Minima Fiscal) is levied at a rate of 3% of turnover of the previous year or F.CFA800 000 in a loss-making year. 3 000 001 – 5 000 000 15% 5 000 001 – 10 000 000 20% capital gains  Capital gains are included in ordinary taxable income and subject to tax (“CGT”) corporate income tax at the standard rate of 35%. 10 000 001 – 15 000 000 25% 15 000 001 – 20 000 000 30% withholding tax WHT rate above 20 000 000 35% (“WHT”) rates payment to Residents non-residents social security branch profits N/A N/A  Both employees and employers must make monthly social security contributions contributions to the INSESO. dividends N/A 25%  The employer contribution rate is 21.5% of gross salaries, whereas the interest N/A 10% employee contribution rate is 4.5% per month.  Employers must also contribute to the Worker Protection Fund (Fondo de royalties N/A 10% Proteccion del Trabajador) at a rate of 1% of payroll and employees at the management, N/A 10% rate of 0.50%. consulting and technical service fees payroll taxes  There is no payroll tax in Equatorial Guinea. *The withholding tax rate may be reduced in terms of a relevant double tax stamp duty  Stamp duty is levied on a broad class of legal instruments at rates varying agreement. from F.CFA500 to F.CFA2 000 per page. double tax  DTAs are in force with CEMAC (member countries include , the  Property transfer tax (impuesto sobre transmisiones patrimoniales inter agreements Central African , , and the Republic of Congo). vivos) at rates varying between 1% and 5% is payable on the transfer of (“DTAs”) shares.  The transfer of immovable property is subject to property transfer tax losses  Losses may generally be carried forward for a period of three years. (impuesto sobre transmisiones patrimoniales inter vivos) at rates varying Companies operating in the hydrocarbon sector may carry forward losses between 5% and 25%. for five years.

4 doing business in Equatorial Guinea

value added tax procedure  An application is filed at the OAPI office in Equatorial Guinea. An (“VAT”) application is examined to determine if it complies with formal taxable supplies  VAT is levied on the supply of goods and services in Equatorial Guinea requirements and in respect of prior conflicting trade marks. If accepted, and on the importation of goods and services. the registration certificate will be issued and the trade mark registration published for opposition purposes. VAT rate  15% oppositions  Opposition may be lodged within six months following the date of registration  All individuals and companies that carry out, occasionally or habitually and advertisement of the registration. No extensions are allowed. threshold in an independent manner, economic activities of production, sale, import duration and of goods or supply of service, including agricultural and professional  A trade mark registration is effective for an initial period of 10 years and, renewal activities, are subject to VAT. thereafter, renewable for further periods of 10 years.

reverse VAT on  If non-residents have not appointed a tax representative domiciled in imported Equatorial Guinea, resident companies are required to account for output services VAT in respect of imported services rendered by non-resident companies. trade marks For more information or assistance please contact:

international  Madrid Protocol Celia Becker conventions,  Nice Agreement Executive | Africa regulatory and business intelligence treaties and  Paris Convention [email protected] arrangements  Trade Mark Law Treaty cell: +27 82 886 8744  World Intellectual Property Organization  World Trade Organization (observer) This document contains general information and no information provided herein may in any way be construed as legal advice from ENSafrica, any of its personnel and/or its correspondent firms. Professional advice must be sought from ENSafrica before any action is taken based on the information *Note provided herein. This document is the property of ENSafrica and consent must be obtained from ENSafrica before the information provided herein is reproduced and/or distributed in any way. Equatorial Guinea is a member of Organisation Africaine de la Propriété Intellectuelle (“OAPI”). An OAPI application automatically covers all member LAST UPDATED 2020 countries, as the member states had to renounce their national IP laws in order to become members. It is therefore not possible to file individual national applications in any of the OAPI member states.

classification  The international classification of goods and services applies. A single application may cover any number of class, however, goods and services may not be included in the same application.

categories of  Provision is made for: trade marks  collective marks;  geographical indications; and  service marks.

filing  Certified copy of the priority document (if applicable); requirements  electronic copy of the trade mark;  full particulars of the applicant; and  Power of attorney, in French or English, simply signed.

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