Opening A Business In Cape Verde
Great Incentives & One-Day Business Creation
Cape Verde legislation has been designed to encourage foreign investment, especially in the fishing, energy and tourism industries. The country has many competitive advantages for overseas investors: it is strategically located close to Europe and en route for flights from the Americas, it boasts a highly motivated 70% literate unskilled workforce as well as a professional workforce of people with degrees from foreign universities. Political stability has been Cape Verde's signature since its independence from Portuguese rule, the climate is moderate, and crime rates are very low.
Cape Verde's waters are rich in under-exploited marine resources, creating a great potential for investments in the fishing industry. While the present catch is only 6,000 tonnes annually, 45,000 tonnes could be caught without exhausting resources, with big opportunities to develop tuna, lobster and shark operations.
Ports, airports, green energy facilities and tourist complexes have been among the preferred areas of investment over the last decade.
If you are interested in opening a business in Cape Verde, you will have to fulfil some bureaucratic requirements and cover certain basic costs. Opening a business in Cape Verde used to take an average of 24 to 40 days, but a few years ago the nation´s rapid growth prompted the authorities to come up with a faster solution.
Business In One Day
This service is offered by the House of the Citizen (Casa do cidadao), which has branches in Cape Verde´s main towns. It is possible to create any kind of company you want, whether it is individually owned, by shares or by quotas, and have it ready to start business in only 24 hours.
The first step is to choose a pre-approved company name and constituent act. The Company-in-a day special service includes all the necessary registrations and publications, as well as an optional company website.
Based on a strategy of pre-approval, the system uses the Internet as an essential tool; the Official Bulletin is published online and payments and taxes are all managed online as well.
A successful application must be presented with the necessary identification, including Passport and Tax identification (called NIF in Cape Verde).When the applicant is applying on behalf of a company, a certificate of business registration and a power of attorney will be required, which will have to be translated and notarized, in case the originals are in a foreign language.
The company´s initial capital must in Cape-Verdean currency and the shareholder distribution should be indicated. Proof of this capital being deposited in a bank should be provided within two business days.
The registrations included are:
DGRNI – Constituent Certificate/Business Registration
INCV – Dissemination of Contracts and By-Laws
DGCI – Income Tax Framework and Declaration of the start of activity
DGT/IGT – Labour Framework
INPS – Social Framework
Proof of registration and company creation will be published online and in the local press, which is a legal requirement for validity.
The cost to create a business is ECV 10.000, plus an additional ECV 10.000 (approx 200 Euros in total) if registering for the Chamber of Commerce.
Opening your business in Cape Verde is not only fast and affordable, the Cape Verde government has many systems in place to ensure that foreign investors will enjoy many advantages. These include very convenient fiscal incentives and specific benefits for investing in certain industries.
Companies with a mind to produce and export out of Cape Verde are particularly encouraged, as you shall see in the incentives listed below. This way, Cape Verde is looking to balance its trade deficit, which is a result of the country's limited production capabilities, especially in the agricultural sector. With a highly productive and readily available workforce, Cape Verde is an ideal place to either invest in hotel buildings or develop a manufacturing enterprise. An economy in constant growth and development, Cape Verde has commonly been singled out as a new land of opportunity for visionary business people from all over the world.
Protection of property and upholding of rights
100% repatriation of earned profits and freedom to open and maintain bank account
Hiring of expatriate workers is allowed
0% tax on shareholder profits for 5 years and/or whenever they are reinvested
0% tax on amortisations and interest on financial transactions that represent a foreign direct investment
Stable Fiscal System (Personal Income Tax of 10% after the 6th year in business, unless there is a more favourable agreement between Cape Verde and the country of the recipient investor).
Duty Free Enterprises (Special Tax System)
0% tax on duties, tariffs or other levies on profits for the first ten years
After the first 10 years, such tax cannot surpass 15% of profits
Customs duties and excise duty exemption for imports of equipment, construction material, fuel and lubricant for manufacturing
Special tax system for import of raw materials and others
Duty free export.
Export-orientated Companies under Regular Tax System
Reduced corporate tax for the first 5 years
Tax exemption on raw materials, finished and unfinished goods used to produce export-orientated goods and services
Imports made for the production of export-orientated commodities is customs duty free
Freedom to export the goods manufactured
Special incentives for specific sectors
All customs duties exemption on import of goods, equipment and materials as listed
Corporate tax exemption on revenue generated by new industrial units for 3 years
Freedom to export the goods manufactured
Corporate tax deduction on reinvested profits.
Customs duties exemption on the import of materials for building and running hotels and tourist facilities.
Corporate tax exemption: 100% exemption for the first 5 years and 50% for the next 10 years
Tax rates deduction on profits reinvested in similar activities;
Deduction of tax rate on taxable expenditures associated with the training of local workers
Freedom to export manufactured goods.
Surely, with all these incentives, benefits and opportunities, opening your Cape Verde business will be well-worth 24-hours of smooth bureaucracy.