How to set up a business in Senegal

Types of companies in Senegal

There are many different types of legal structure for your business, each with their own fiscal, social and administrative rules. The most common are:

• Sole proprietorship
• Limited Liability Company (LLC - known as SARL in Senegal),
• Public Limited Company (PlC - known as SA (société anonyme) in Senegal)
• Economic Interest Grouping (known as GIE in Senegal)

Also, you can set up the following structures, but these are less common:

• Company in Collective Name (SNC)
• Limited Partnership (SCS)
• Cooperative Company

Requirements and procedures for starting a business in Senegal

Sole Proprietorship 

• A minimum of one partner
• Requires no minimum capital
• The hiring or nomination of an auditor is not necessary
• Each partner's liability is unlimited and extends to the entrepreneur's personal property
• The company is managed by the entrepreneur
• The company will be taxed on profits of up to 50 million CFA for goods and services.

To set up an individually-owned company, you will need:

• Two copies of your passport (or national identity card if from an ECOWAS country)
• A declaration of honour - available from a lawyer - completed and signed by the applicant
• A criminal record check from your own country (less than three months old)
• A certificate of residence
• A copy of the marriage certificate (if applicable)
• Two tax stamps of 2,000 CFA each
• To pay incorporation fees of:

           - 10,000 CFA for court fees for individual companies without a commercial name

           - 20,000 CFA for individual companies with a commercial name (10,000 CFA for the registration of the trade name and 10,000 CFA francs for court fees).

The Limited Liability Company (SARL)

• A minimum of one partner
• Requires a minimum capital of 100,000 CFA to be fully incorporated
• An auditor is not necessary unless the capital exceeds 10 million CFA, it has more than 50 permanent employees, or its annual turnover exceeds CFA 250 million
• Each partner's liability is limited to his contributions
• The company is run by a manager (who can be a partner) chosen by the partners
• SARLs pay the corporate tax rate of 30%.

The Public Limited Company (SA)

• A minimum of one partner
• Requires a minimum capital of 10 million CFA in order to be fully set up (only a quarter of which is required at the outset and the rest paid over three years)
• An auditor has to be hired
• Each partner's liability is limited to the amount of their contributions
• The company is managed by a Managing Director and pays 30% corporation tax.

To set up a SARL or SA, you will need:

• A declaration of honour - available from a lawyer - completed and signed by the Manager
• A criminal record check from the country of origin (less than three months old)
• Photocopies of partners' identity cards
• The minutes of incorporation and the declaration of conformity drawn up by the lawyer
• To pay incorporation fees consisting mainly of registration fees and lawyer fees:

           - Registration fees: 25 000 CFA if the capital is between 100,000 CFA and 10 million CFA; 1% of the capital if it is greater than 10 million CFA

           - SARL lawyer fees: 20,000 FCFA for SARLs with capital between 100,000 and 500,000 CFA: 400,000 CFA if the capital is greater than 500,000 FCFA

            - SA lawyer fees: approx 700,000 CFA for a capital of 10 million.

Economic Interest Grouping (GIE)

• A minimum of two partners
• Requires no minimum capital at the start-up
• An auditor is not mandatory
• The liability of each partner is limited and consolidated
• The company is managed by a President.

Setting up a GIE requires:

• A member of the proposed GIE to file the application.
• The designated president of the GIE to sign the trade register and the declaration of establishment.

You are also required to provide the following documents:

• Three printed statutes
• Copies of the members' identity documents
• A declaration on honour completed and signed by the president
• A criminal record check from the president from their country of origin (less than three months old)
• Two tax stamps of 2,000 FCFA
• 65,000 CFA of application fees (35,000 CFA for the registration of the statutes and 30,000 CFS of registration fees).

Summary of procedures

All companies set up in Senegal have to be registered with the Companies and Associations Register to obtain a Numéro d'Identification Nationale des Entreprises et Associations (NINEA), that is a company identification number.

You will then have to pay for and fill out five declarations of establishment forms named 'Déclaration d'Établissement', which you will have to produce to the regional labour inspectorate and the nearest social security office to your company's premises. These forms will be stamped, and an identification number will be issued. Note that this form is available at Chambers of Commerce.

You will then have to fill out the registration application form provided by the Social Security Fund office and return it. You also have to request for registration with the Institution de Prévoyance Retraite du Sénégal (IPRES), that is the pension fund.

If your company has less than 100 workers, you can register it with the Institution de Prévoyance Maladie, that is a health insurance fund, which will fully or partially pre-finance health care fees for all employees and their families.

Tax in Senegal

Finally, you will have to declare your company's income with the Tax Administration Office. You are required to file and return the tax declaration form within the legal deadline, stating the following:

• Your full identity
• Your family status as of the 1st January of the current year
• Any dependent children as of the 1st January of the current year
• Categories of income received
• Deductible expenses from taxable income
• Any withholding taxes incurred.

 Important:

Before setting up a business in Senegal, you should determine which type of entrepreneur you are. Also, you should think about any contacts you have that could help you with the application, understand the costs involved and make you aware of the local market and competition.

 Useful links:

Ministry of Commerce 
Senegal Government, Creating a SARL or SA company 
Senegal Government, Creating a Sole Proprietorship company 
Taxes and Domains
Public service - Trade and Property Credit Register
APIX, Invest in Senegal - Information on procedures