Investments in this African country come with a lot of benefits such as little competition, a big African market, a growing economy, et cetera. This is why it is a haven for foreign investors who want to set up businesses here. There are three types of business structures for persons looking to set up or buy a company within this territory. The Société À Responsabilité Limitée (SARL/SURL) known as Limited Liability Company, Société Anonyme (SA) the Public Limited Company and the Free Zone Company. Every structure differs when it comes to liability, tax, and individual ability to regulate their income made.
Buying a Company
Buying an establishment is quite easy provided one has to finances to cater to the transaction. A business owner with an already existing business can choose to buy out a closing business selling the same goods as his. This is an easy way of eliminating competition in the market. You can buy an establishment and merge it with an existing one or continue to run it as it is. Whatever the reason for buying is, caution must be taken to avoid scams and fraud.
The first step is to research to ascertain if the entity is truly for sale, has no debts owed, and can provide authentic financial records submitted by its auditors. Once this is sorted out, the next step is to hire the services of a business support services provider who can stand in for your company during the transaction. Such companies offer various services of which entity purchase is one of them. After hiring one, they will inform you of how the transaction is going so you don’t need to travel to the country.
Note that you cannot just buy any type of company as certain companies have requirements that need to be fulfilled such as the free zone company.
Doing Business in Burundi
Conducting business here offers lots of opportunities and business incentives like friendly taxes, affordable labor, a rich source of raw materials, lower cost of production and distribution than in developed countries, channels into the African market, etc. The Burundi investment promotion agency is responsible for the regulations of business entities allowed to operate in the country and other business-related activities. Amongst all types of structures, the limited liability company is a common choice for small business owners, persons, and or corporate bodies with little investments.
Types of Companies
According to the Burundi Investment Promotion Agency, when an establishment wishes to carry out business legally within the country without restrictions, it has to be registered by the office and make sure it abides by all regulations of business stipulated by the agency government. Only three types of business structures are recognized by the agency, all of which have distinct features and carry out business activities. The entities include Société À Responsabilité Limitée (SARL/SURL) also known as Limited Liability Company, Société Anonyme (SA) (Public Limited Company), and Free Zone Entities. A limited liability company is a type of business where the shares are limited to only the shareholders. A public limited company allows the public to buy its shares when available. The free zone entity is only available to foreigners who satisfy the requirements asked by the government, as this is a special company with lots of benefits.
Features of a Company
When setting up or buying an entity, it is important to know the forms of entities available and the features to note when choosing one. The following are features of a company irrespective of the type.
- Liability of Shareholders
- Foreign Ownership
- Registered Address
- Minimum Capital
- Number of partners, etc.