Company Registration in Morocco in 2023-24
The economy of Morocco has made impressive advancements in the past decade to become a popular destination for investors and entrepreneurs from abroad. Eventually, Morocco’s government has committed to enticing entrepreneurs to start a business, by offering tax incentives.
Establishing an organisation in Morocco is much easier than ever before, as it will only take two days to submit your incorporation application and due to an inflation rate which is less than 2%, it makes the country an interesting business area to set-up your business.
Recently, Renault has set up a manufacturing unit worth $1.5 billion with a production capacity of more than 150,000 cars in a year.
If you are intending to register a company in Morocco, it is crucial to have a deep knowledge of the various business entities along with Morocco’s rules & regulations that may affect you while you think of company registration in Morocco.
Procedure for Morocco Company Registration
The procedure for company registration in Morocco typically involves the following steps:
- Step 1:- Choose a company name and ensure it is available for use in Morocco by checking with the Trade Register.
- Step 2:- Draft the company’s articles of association and have them notarized.
- Step 3:- Obtain a tax identification number from the Moroccan tax authorities.
- Step 4:- Acquire a registration certificate from the Trade Register.
- Step 5:- Open a corporate bank account in Morocco. Deposit the minimum share capital requirement with the bank, which is MAD 30,000 (approximately USD 3,200) for a limited liability company.
- Step 6:- Obtain any necessary business licenses and permits.
- Step 7:- Complete the registration process with the Moroccan Chamber of Commerce and Industry.
After the successful completion of the Morocco company registration process, you can start operating the business smoothly.
Documents Expected for Company Registration in Morocco
Here are a few of the documents that may be expected for company registration in Morocco.
- Proof of identity of directors and shareholders
- Company articles of association
- Notarized certificate of deposit of minimum share capital
- Proof of registered business address
- Tax identification number
- Bank certificate of deposit of share capital
- Work permit for foreign nationals (if applicable)
- Business License
- Chamber of Commerce registration certificate.
It is important to note that the specific document requirements can vary depending on the type of company and the industry it operates in. However, our professional experts will help you out with the process, if wish to reduce the chances of errors.
Types of Business Entities for Company Registration in Morocco
In Morocco, the following types of business entities can be registered, when you think to register a company in Morocco.
The most common entities are:
Limited Liability Company (SA)
A Limited Liability Company (SA) in Morocco must have a minimum of five shareholders and these shareholders could be legal or individual entities. The losses of each shareholder are restricted to the equity in shares they own. The company won’t have a name or corporate identity, just an official name for trade.
Private Limited Company (SARL)
The term “private limited company” refers to a Private Limited Company (SARL) in Morocco as a type of intermediary between associations of individuals and capital. The minimum equity capital required for registering a private limited company is around 10,000 MDh.
The private limited company has to submit a memorandum of agreement during the incorporation and the capital stock must be properly described and paid out at the time the company is created.
The subsidiary or branch affiliate of a foreign company is considered to be a distinct legal entity. The Moroccan branch is required to provide certain information about its parent company as well as its representatives and delegated powers
Foreigners may establish in Morocco as sole proprietorships. If a sole proprietorship is established, the business is run under the control of an individual who is personally responsible for the obligations of the company up to the full extent of the personal and business assets. The company must register with Commerce Registry and with the tax authority.
Eligibility for Morocco Company Registration
To be eligible for company registration in Morocco, the following requirements must be met:
- Minimum 1 shareholder (Individual/ Corporate Entity).
- Minimum 1 director.
- 100% local or foreign shareholding allowed.
- The firm should possess a registered business address in Morocco.
- The least share capital expected to register an LLC in Morocco is MAD 30,000 (approximately USD 3,200).
- The firm should obtain a tax identification number and comply with all relevant tax obligations.
- Foreign nationals may need to acquire a work license to function in Morocco.
Various Taxes on Morocco Company Registration
There are numerous taxes that firms need to pay before company registration in Morocco:
- Corporate Tax: Companies are subject to a corporate tax rate of 28%.
- Value Added Tax (VAT): Companies that engage in taxable transactions must register for VAT and charge a rate of 20% on the sale of goods and services.
- Withholding Tax: Companies are required to withhold tax on certain payments, such as dividends and interest. The withholding tax rate ranges from 10% to 20%.
- Personal Income Tax: Companies are required to lessen personal income tax from the incomes of their workers and reimburse it to the tax authorities. The personal income tax price varies from 0% to 35%.
Cost to Register a Company in Morocco
The cost to register a company in Morocco will vary depending on various factors, such as the type of business entity, the amount of share capital, and the legal and administrative fees involved.
Typically, the cost of company registration in morocco, such as a limited liability company can range from MAD 10,000 to MAD 50,000 (approximately USD 1026 to USD 5,130), which includes notary fees, Trade Register fees, and Chamber of Commerce fees.
Additionally, foreign nationals may need to pay for a work permit, which can cost up to MAD 10,000 (approximately USD 1,000). The cost of obtaining a business license will also differ depending on the kind of company.
It is advisable to consult with our business experts at Odint to get an accurate estimate of the cost of Morocco’s company registration.
Why register a company in Morocco?
There are several reasons why someone may choose to register a company in Morocco:
- Low Operating Costs: Operating costs in Morocco are lower compared to other countries in the region, making it an attractive destination for companies looking to reduce costs.
- Access to European and African markets: Morocco is strategically located at the crossroads of Europe and Africa, providing companies with access to these markets.
- Favorable Business Climate: Morocco has a stable political and economic climate, with a government that is supportive of foreign investment.
- Talented Workforce: Morocco has a large pool of skilled and affordable labor, making it a favorable destination for companies in need of labor-intensive operations.
- Tax Incentives: Morocco offers tax incentives and subsidies to companies that invest in specific sectors, such as renewable energy, tourism, and industrial development.
- Government incentives: The government proposes numerous incentives and tax breaks to companies that establish operations in Morocco.
Benefits of Morocco Company Registration
- Favorable business climate
- Strategic location for access to EU, Africa, and Middle East markets
- Diverse economy with strong agriculture, tourism, and manufacturing sectors
- Competitive labor costs and tax incentives
- Bilingual in French and Arabic with strong ties to Francophone Africa
- Developed infrastructure and modern transportation network
When you think of Morocco Company registration, an interested investor must be aware of legal procedures, international regulations, and adequate investment to succeed. Morocco’s Tanger-Med port is one of the busiest in Africa which opens routes to the European market which implies that there will be good ROI for channel traders and exporters.
It is crucial to know the social, cultural, and political aspects that affect a business’s setting up and expansion. However, international launches that are poorly researched typically end up in disaster since time, money, and energy are lost due to poor plans.
Yet, registering a company in Morocco could be a daunting process, though it’s suggested to get assistance from professional experts from Odint Consultancy to guide you through the process of company registration in Morocco.
LLC incorporation costs in Morocco are US$5,300 and entire registration fees to US$12,725 on average per engagement, containing Morocco company registration, opening bank account fee, legal listed office address, and all administration enrollment fees.
There are many opportunities for businesses to start in Morocco, and the government is always supportive of new businesses.
It can be permitted to individuals with an association with the nation, or to a permanent citizen who has resided in the country for a given duration through naturalization.
Unless precisely eliminated by a treaty, foreign-source revenue obtained by a Moroccan citizen is taxable in Morocco.
Persons who possess their tax residence in Morocco are accountable to a personal income tax on their worldwide earnings. Individuals not having their tax residence in Morocco are subject to tax only on Moroccan-sourced income.