Morocco’s economy has made remarkable progress in the last decade to become a desirable destination for international investors and entrepreneurs. Its Government has devoted, for a few years, to the liberalization of its economy. Investment processes in the country have been facilitated to encourage more entrepreneurship in the region, and new laws have been passed to boost the growth of local and foreign private companies. Its government has also signed free trade agreements with various partners, including the European Union, and the U.S.
Setting up a company in Morocco is quite simple as it takes only a few days to submit the incorporation file and register the company.
That said, outlined next are the forms of company in Morocco and the steps involved in establishing one.
Formalities required to set up a company in Morocco
Choosing a legal structure
Foreign companies have options between various legal forms to carry out their activities in Morocco. The different types of companies in Morocco fall under the following three main categories:
Companies:
- Public limited company (PLC) or Société anonyme (SA)
- Limited liability company (LLC) or Société à responsabilité limitée (SARL)
- Partnership limited by shares or Société en commandite par actions
Partnerships:
- General partnership Société en nom collectif
- Limited partnership or Société en commandite simple
- Joint venture partnership or Société en participation
Companies With Special Regulations:
- Investment company or Société d’investissement
- Purchasing Cooperative company or Société coopérative d’achat
- Consumer cooperative company or Société coopérative de consommation
- Mutual insurance company or Société mutualiste.
Generally, the most used legal forms of companies in Morocco are the Limited Liability Company and the Public Limited Company.
For these reasons, only the LLC, PLC, and branch will be explained:
The Limited liability company in Morocco
The LLC is a legal entity with a legal personality. It is the most popular type of company in Morocco. It is a commercial company and attains legal personality after registration in the commercial register. The number of partners can differ from a minimum of one to a maximum of fifty. If there are over 50 partners, the company must be modified into a public limited company.
The shareholders of the LLC are free to determine in the articles of association the amount of share capital initially contributed and there are no minimum requirements. But if the share capital exceeds MAD 100,000, it must be deposited in a blocked bank account from which it cannot be withdrawn until the company is registered in the commercial register.
Public limited company in Morocco
This is the second most popular legal form in Morocco in which shareholders hold negotiable shares and have liability for losses restricted to the amount of their contribution.
It requires a minimum of five shareholders who may be individuals or legal entities. 25% of the equity capital must be paid in advance and if the equity capital is paid in contributions in kind, it must be fully paid upon incorporation. This type of company will have no corporate name just a trade name.
Simplified Public Limited Company
This is a type of company formed between two or more companies in order to establish or manage a joint subsidiary, or to create a company that will become their common parent.
The capital requirements of each member must be a minimum of 2 million MAD or its equal in foreign currency. The company is formed by articles of association signed by all the members.
It’s a type of company that is not bound by restrictive rules such as those of a public limited company. The provisions pertaining to its management are in the Articles of Association. The only responsibility is to assign a president.
Branch office
A branch is a company created by a foreign parent company and it is considered a separate legal entity. The Moroccan branch has to disclose specific details considering its parent company, its representatives, and its delegated powers.
Steps To Establishing your company in Morocco
- Getting negative certificate: the negative certificate is a document that validates that the requested company name is not already in use and can be entered for registration in the Trade Register. It is the first document essential for starting a business. The negative certificate is granted by the Moroccan Office of Industrial and Commercial Property and gives ninety days to complete the registration formalities in the trade register.
- Drawing up of Articles of Association: the articles of association are a set of contractual provisions which establish the rules applicable to a particular legal situation. They can take two structures: the notarial act or private signature.
- Preparation of subscription forms: the subscription form is a document to be finalized in the event of participation in the constitution of the company’s capital. It comprises a commitment of a contribution in cash.
- Block the amount of paid-up capital: opening a temporary bank account in a local bank where the company’s share capital will be transferred is necessary, and once the transfer is completed, the bank issues a certificate of capital freezing.
- Preparation of the subscription and payment declaration
- Filing business creation documents and registration formalities: the application files required to start the business are processed at the level of the local Regional Investment Center by representatives of the several authorities concerned with the business creation.
- Registration of professional tax and fiscal identifier: this step allows the company to select its tax regime and obtain its professional tax identifier.
- Registration in the trade register: registration in the commercial register is the birth certificate of the company.
- Registration to the CNSS (National Social Security Fund): registration to the CNSS is a legal responsibility.
Any company subject to the social security system must register nearby the CNSS which then issues a registration number that includes administrative recognition of its identification, registration, and attachment to the authority.
- Publication: once the company is registered in the trade register and within a period not surpassing one month, two advertisements are necessary – in the legal notices journal and in the Official Journal.
The handling of the above processes, which are essential in the case of the establishment of a company in Morocco, is not of huge intricacy, but they need attention to details, signatures, legalizations, and the applicable formalities.
In other words, contact your Damalion expert now for your company registration in Morocco.
