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Doing Business in Eritrea

Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Eritrea. It examines the procedures, time and cost involved in launching a commercial or industrial firm with between 10 and 50 employees and start-up capital of 10 times the economy's per-capita gross national income.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 189 economies. The most recent round of data collection was completed in June 2015.

 

No.		Procedure	Time to Complete	Associated Costs
	1	Deposit initial capital in bank account Agency: Commercial Bank The minimum capital requirement is ERN 15,000 for a private limited liability company and ERN 50,000 for a share company.	1 day	no charge
	2	Search for a company name Agency: Business License Office The search is conducted at the Commercial Registry.	2 days	no charge
	3	Notarize company statutes Agency: Notary At this point, the memorandum and articles of association will have been signed by the shareholders, and a stamp duty will have been paid.	3 days	ERN 715.2
	4	Register with the Commercial Registry Agency: Business License Office To Register with the Commercial Registry, five or six copies of the memorandum and articles of association must be submitted at the License Department of the Ministry of Trade and Industry.	7 days	no charge
	5	Publish the incorporation notice in the official journal Agency: Ministry of Information An incorporation notice is published (in both Arabic and English) in the official journal, Hadas Eritrea, announcing the company incorporation. Protestors have 30 days to contest the company’s incorporation and name.	33 days	ERN 600 –1000
	6	Apply for a tax identification number (TIN) at the Inland Revenue Department Agency: Inland Revenue Department Once the company registers at the Inland Revenue Department for the taxpayer identification number, it is recognized as a VAT taxpayer.	7 days	no charge
	7	Obtain tax clearance from the Inland Revenue Department Agency: Inland Revenue Department All new businesses must obtain tax clearance from the Inland Revenue Department.	1 day	no charge
	8	Apply for a business license at the Ministry of Trade and Industry Agency: Ministry of Trade and Industry A business license application requires tax clearance and property title documents. The cost of the business license ranges from ERN 500 to ERN 1,000.	14 days	ERN 500
*	9	Receive inspection from the Ministry of Trade and Industry Agency: Ministry of Trade and Industry The business license inspection, required for zoning purposes, may take only a day, but it also will take a day to set up an appointment.	7 days (simultaneous with previous procedure)	ERN 500
	10	Obtain approval from the local municipality Agency: Local municipality All new businesses must obtain approval from the local municipality.	2 days	ERN 100-500
	11	Notify the Ministry of Labor and Human Welfare Agency: Ministry of Labor and Human Welfare All companies must notify the Ministry of Labor and Human Welfare by completing the registration form and submitting it to the Ministry for approval.	1 day	no charge
	12	Make a company seal Agency: Seal maker The practice is not regulated, but the seal will include the tax code for the company.	3 days	ERN 400
	13	Apply for tax receipts from the Inland Revenue Department Agency: Inland Revenue Department The company may either print the receipts directly at the Inland Revenue Department or obtain permission to print them itself.	10 days	ERN 200 for 10 packs of receipts