The legal system is sound, institutions are operating, and doors are actually open to foreign investors. In case you are considering establishing a subsidiary here, it is not as difficult as you may have imagined. I will show you what it really involves.
Why Namibia makes sense
The figures narrate a portion of the tale. The economy of Namibia is approximately fourteen billion dollars, with mining, logistics, agriculture, and an increasingly expanding tourism industry being responsible. In the recent past, foreign direct investment surpassed half a billion dollars, and this trend does not indicate that it is decelerating. However, the crucial thing is access. With SACU and SADC, a Namibian subsidiary has sixteen markets in Southern Africa. Chuck the African Continental Free Trade Area in the equation, and you begin to view the bigger picture.
Choosing your structure
A majority of businesses choose a private limited company, which is locally referred to as Proprietary Limited or simply the Pty Ltd. This is the type of structure that provides limited liability, separate legal status and the possibility of having up to fifty shareholders. This is the normative option of a subsidiary.
The smaller operations can also choose the Close Corporation, or CC. It is less complicated and less expensive, and targets a business with a small number of ten members or fewer. The management of finances is not as strict, and the registration fee is also significantly lower. However, when you are a foreign firm and are serious about making an appearance, then the Pty Ltd route will be the right call.
The step-by-step process
The entire roads point to BIPA, the Business and Intellectual Property Authority. This is the government agency that is dealing with company registrations, and they have made it relatively efficient. It begins with a name. You have to file a name reservation application, and it is a good idea to give three to six options in case your first choice has been occupied. The charge is a small seventy-five Namibian dollars, and it usually takes three workdays to be approved.
And now your name is guaranteed: to the papers. The most important documents are the Memorandum and Articles of Association that will determine the way your company will operate. A notary public must certify these. Also required will be forms CM1 and CM46, director consent letters, a certified copy of passport of all foreign directors and shareholders, and a statement of beneficial ownership. Evidence of a registered physical address in Namibia is also required, but can be a leased address or, at the very least, a virtual address of a service provider.
When you are finished with your dossier, you hand it over to BIPA. Depending on the nature and the necessity of any amendments, processing requires five to twenty- five working days. On approval, you are issued your Certificate of Incorporation and your Certificate to Commence Business.
What it costs
The figures are different when you ask different people and include different things. The fee schedule issued by BIPA itself indicates a name reservation fee of seventy-five dollars, Form CM1 of one hundred and fifty dollars and other fees depending on the share capital and the Certificate to Commence Business of one hundred dollars. Other forms have smaller fees, which usually range between twenty and fifty dollars each.
Follow-ups after registration: The imperative
Now, you will really start to work with your certificate. To get a Tax Identification Number, you have to be registered to pay your taxes at the Namibia Revenue Agency, NamRA. In case you have an annual turnover that will be above one million Namibian dollars, then you must register for VAT. In case you intend to employ workers, you are obliged to register with the Social Security Commission.
The next thing is to open a bank account. Major banks such as First National Bank Namibia and Standard Bank accept foreign-owned subsidiaries, but be ready to be subjected to intensive due diligence. Anti-money laundering regulations will imply that they will desire to know your incorporation papers, Memorandum and Articles, identification of directors, and evidence of your registered address. With everything in order, this step will become much less painful. You might require industry licenses depending on your industry. The Ministry of Mines and Energy deals with mining and energy. The Ministry of Environment, Forestry and Tourism should give the tourism business the green light. NAMFISA regulates financial services. These requirements have to be checked prematurely, as they may complicate your schedule.
Attention to a few practicalities
No minimum capital requirement is stipulated by statute for a Pty Ltd company other than the regulated industries. It can be what makes sense to your business to begin with.
Nothing to do is required to get to Namibia to get the registration done. The entire BIPA process is possible remotely using scanned and notarised documents. Others provide this as a normal package to many service providers.
One thing to remember: although foreign directors can stay, some sources indicate that in the case of entirely foreign directors, a Namibian citizen or resident might be required to hold the position of company secretary. This is something that you would want to confirm with your legal advisor with regard to your particular structure.
Conclusion
It is not a secret to register a subsidiary in Namibia. The process is well spelt out, the regulator is available, and although it takes time, the process is predictable. The registration is not the only thing that is appealing to the foreign investor. It is of establishing a flag in a nation that does not frivolize business, and that genuinely provides access to the region, and that does not require that you transfer power.
The costs are reasonable. The legal framework is solid. And when you are incorporated, you have an active, legal entity within one of the most stable jurisdictions in Africa. In case Namibia is on your radar, do not be overwhelmed by the paperwork. And it is a process with a beginning, middle and end. And when you get to the end, you have a business to trade.
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