Bolivia Info
Joined: 23 Nov 2006
Posts: 16
Home Country: bolivia
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 Posted: Mon Nov 27, 2006 11:16 pm Post subject: DOING BUSINESS IN BOLIVIA / BOLIVIA BUSINESS GUIDE |
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DOING BUSINESS IN BOLIVIA
STARTING A BUSINESS
STANDARDIZED COMPANY
Legal Form: Sociedad Anonima
Minimum Capital Requirement: 300
City: La Paz
Registration Requirements:
Procedure 1. Check uniqueness of name at the Registry of Commerce in FUNDEMPRESA
Time to complete: 1 day
Cost to complete: no charge
Comment: The verification of the existence of the name can be done through telephone and does not have any cost.
Procedure 2. An attorney draws the articles of incorporation, bylaws and constitution act, which includes the appointment of the provisory board.
Time to complete: 1 day
Cost to complete: BOB 7,800 = BOB 6,500 legal fee + BOB 1,300 (procurement for processing of documents with Registry)
Comment: Professional fees may vary. The fees schedule of the lawyers association (Colegio de Abogados) establishes that the minimum fee for the incorporation of a company should be Bs 3,000 plus 2% of the company's capital. The fee for processing the formalities at the registry may also vary.
Procedure 3. Notarize the articles of incorporation
Time to complete: 1 day
Cost to complete: BOB 1000
Comment: Obtain several notarized copies of public deeds, which are needed to be filed for the procedures below. Also there is notarization of almost every document that is needed for registration.
Notary cost: Bs480-1,500 for one copy
Procedure 4. Publish company deed (bylaws and statutes) in a national newspaper
Time to complete: 2 days
Cost to complete: BOB 50 (BOB 5 per page)
Comment: According to Administrative Resolution SNRC - DN Nº 254/2003 issued by the National Service of Registry of Commerce (SENAREC) on May 30, 2003, the publication of a public deed of incorporation must be done in a summary that shall contain: characteristics of the natural persons or companies as shareholders (age, name, profession, nationality, marital status in cases of natural people or proof of incorporation, by-laws, power of attorney, NIT, in cases of companies); denomination of the new company; social object or purpose of the society; amount of authorized, subscribed and paid-in capital; number, value and nature of shares; and term. The firm needs to wait until the documents are actually published before filing in the request to obtain legal capacity with the Registry of Commerce.
Procedure 5. An accredited accountant prepares the Opening Balance Sheet
Time to complete: 1 day
Cost to complete: BOB 1000
Procedure 6. The Opening Balance Sheet is administered by the seal of the Colegio de Contadores
Time to complete: 1 day
Cost to complete: BOB 50 for each balance sheet
Procedure 7. Register at the National Tax Service to obtain the tax Identification Number (Número de Identificación Tributaria - NIT)
Time to complete: 1 day
Cost to complete: no charge
Comment: According to Administrative Resolution RND 10-0013-03 of the National Tax Service, starting as of January 1st, 2005, a NIT will be issued to every tax payer so it will completely replace R.U.C. registrations, which are no longer valid. Board Regulation Resolution Nº 10-0032-04, dated November 19th, 2004, provides the requirement and proceeding to obtain the NIT, which is mandatory to all commercial entities.
Procedure 8. Obtain a Municipal business license and a Municipal Registration Card (Padrón Municipal) from the municipality where the business is located
Time to complete: 7 week
Cost to complete: no charge
Comment: File the respective form at the Sole Municipal Window, photocopy of the NIT, the last electrical bill of the venue, a floor map of the venue, photocopy of the Power of Attorney, and the ID cards of the legal representatives, photocopy of the constitution Deed. For the granting of the business license, the Municipal Government shall perform an on site inspection in order to verify the technical and environmental characteristics of the venue.
Procedure 9*. Municipal Government inspects the technical and environmental characteristics of the venue
Time to complete: 1 day, included in the previous procedure
Cost to complete: no charge
Procedure 10. Obtain evidence of a bank deposit equivalent to at least 25% of subscribed and no less than 50% of authorized capital
Cost to complete: no charge
Comment: The 25% of subscribed capital is the minimum capital that must be deposited in a bank, which shall no be less than 50% of the authorized capital. Pursuant to article 220 of the Bolivian Code of Commerce, the capital must be totally subscribed to register a society and it can not be less than 50% of the authorized capital. Also, according to the article 127 of the Bolivian Code of Commerce, the term for payment of the unpaid subscribed capital may not exceed 2 years.
During 2004 a new tax was created, I.T.F. "Impuesto a las Transacciones Financieras".
According to Law N° 2646 dated April 1st , 2004 and Supreme Decree N° 27566 dated June 11th, 2004, I.T.F. has an applicability term of 24 months starting as of July 1st , 2004. During the first 12 months the payable amount will be 0.03% and thereafter 0.025% of the total amount of the banking transaction.
I.T.F. taxes:
1.- Deposits and Withdrawals to and from Bank Accounts.
2.- Payments and/or Transfers of founds from any type of bank account.
3.- Acquisition of Traveler Checks, Management Checks.
Note: all the above listed transactions will be taxed with I.T.F. when a financial entity is involved.
Procedure 11. Register company deed (bylaws and statutes) with the Fundación para el Desarrollo Empresarial - FUNDEMPRESA and obtain legal capacity
Time to complete: 9 days
Cost to complete: BOB 584.5
Comment: The registry of commerce has been granted in concession to a private operator (Fundación para el Desarrollo Empresarial - FUNDEMPRESA) since 2002.
File an application for new registration; oOpening statement of Account Balance certified by the Colegio de Contadores, Public Deed of the Constitution comprising of the Charter Documents and the Deed whereby the provisional Board of Directors is appointed, Bylaws, and Bank certificate or deposit stub certifying the deposit of the paid capital, the publication made thereof.
Procedure 12. Register at the appropriate Chamber of Commerce or Industry
Time to complete: 1 day
Cost to complete: USD 40 for registration; USD 19 for monthly payments and USD 5.00 for certificate and credentials, varies depending on the type of the chamber
Comment: Pursuant to Art. 54 of Supreme Decree 16833, dated July 19th, 1979 , and Supreme Decree 17242 dated March 3rd, 1980, each and every company must be registered at the its respective Chamber.
Procedure 13. Register for national health insurance & short-term disability coverage
Time to complete: 20 days
Cost to complete: BOB 15 per form, 3 forms
Comment: Employer may register with any health insurance company (Caja Nacional de Salud, Caja Petrolera de Salud, Caja de Salud de la Banca Privada, etc.)
Submit the forms of the CNS, Id of the legal representative of the company, Articles of Incorporation, Statement of Opening Company Balance of Accounts duly approved and sealed by the SIN, NIT , projected payroll + employees civil status + names of dependents + national identity numbers; 3 forms.
Procedure 14. Register at the Ministry of Labor, enroll in the "Kardex Nacional de Establecimientos"
Time to complete: 1 day
Cost to complete: BOB 50
Comment: According to Resolution Nº 002/04 issued by the Ministry of Labor on January 13th 2004, the registration process under such Ministry was simplified and the following requirements must be filed to register an employer:
a) Unified Employer's Registry Form
b) Presentation of first monthly payroll
c) Bank deposit for Bs. 50
The employer must complete this procedure within three months from the moment the company hires employees.
Procedure 15. Register employees with the Pension Fund Managers (AFPs)
Time to complete: 3 days
Cost to complete: no charge
Comment: New employees must register within 10 days of initiated the labour activity, If the employee refuses to register in this term, the employer shall have to accomplish this procedure.
Actual contributions are as follows: employer 1.71%; employees 12,21%
Fill out the employer registration form, photocopy of the NIT, photocopy of the legal representative, photocopy of the documents attesting the initiation of activities of the company (The go-ahead given by the social security, labour contracts of its dependents with a photocopy of the ID of each thereof, a signed document whereby the dependents state their first contribution, one of the above documents will suffice).
The Pension Fund Act, which dates back to May 1st, 1997, established a period of five years of exclusivity to Pension Fund Administrators. Such exclusivity was achieved by dividing between the two existing pension Fund Administrators the birth date of affiliates. On may 1st 2002 the five year term was over, thus leaving the subscription of which of the AFP's to the will of the affiliates.
Note: Procedures sometimes take place simultaneously. Instances of this are marked with an asterisk (*).
TAXATION
The Bolivian revenue system contains an unusually large number of taxes, leading to complexity and confusion that make the system difficult to enforce. Income taxes are extremely low, with a flat individual rate of 13%. In December 1994, a 25% tax on corporate income was established which replaced the 3% national income tax on corporations' taxable net worth. Both local and foreign corporations can receive tax holidays, exemptions, and other benefits if they invest in new companies or in production of nontraditional exports. There is an effective tax rate of 12.5% on income and net dividends to non-resident parent companies. There are taxes on the value of particular assets, such as motor vehicles, boats, and airplanes, which can be deducted from income tax, and taxes of 18-50% on automobiles (18%), alcohol (50%), perfume (20%), cosmetics (30%), and other items classed as luxuries. A value-added tax (VAT) of 13%, which can be deducted from income tax, is in effect. The hydrocarbons industry, as outlined in the Hydrocarbon Law, pays an 18% royalty and tax rate for new projects, and a 60% royalty and tax rate on existing projects. |
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