Registration of companies in Turkmenistan
MAIN LAWS ON COMPANY REGISTRATION IN TURKMENISTAN:
The Civil Code of Republic of Turkmenistan (July 17, 1999), the Law of Republic of Turkmenistan “On Companies” (200), Decree of the President of Turkmenistan “On the Inter-Departmental Committee for the State Registration of Legal Entities” (November 11, 2011).
MAIN BUSINESS LEGAL STRUCTURES IN TURKMENISTAN:
- BE (Business Entity).
- Branch/Representative Office.
Citizens of any country, not only of Turkmenistan, may establish a company. There are no obstacles connected with registration, limitations related to participation as a founder for the foreign citizens, except for the cases of violation of Turkmen or international law.
The state duty is 8000 manats (around 2800-3000 US dollars) and is paid after the State Committee makes a decision on registration.
A decision on registration of a Business Entity or a Branch/Representative Office is made by the State Committee on a practically “individual” basis.
That is why, in case of denial, advance payment for legal services will not be returned and our team can give you no guarantee of the positive decisions.
To choose which legal structure of business in Turkmenistan is best for you, you can order us to draw up a legal report, in which we compare pros and cons, as well as tax burden of a certain legal structure.
NAME OF A BE IN TURKMENISTAN:
After choosing the desired form of business, you have to select several variants of a name. Using of words “Turkmenistan” and “Ashgabat” is not allowed, although, on a case-by-case basis, analogous names, for instance, with “turkmen-” prefix, can be discussed.
MINIMUM AUTHORIZED CAPITAL OF A BE IN TURKMENISTAN:
The authorized capital must be at least 100 000 USD (in some cases – at least 200 000 (two hundred thousand) USD, depending on the kinds of activities of the founder).
Such amount of the authorized capital is not established in any law: the regulations establish a necessity to contribute only 5000 Turkmenistani manats.
However, based on the practice, the abovementioned amount of the authorized capital can be considered as an unspoken rule of business.
The authorized capital can be paid in cash or in property with at least the abovementioned value. A decision is made by the State Committee. Upon making of a decision on registration by the State Committee, one can pay the state duty.
MAIN SERVICES OF REGISTRATION OF A COMPANY IN TURKMENISTAN:
- Preparation of constituent documents of a BE;
- Registration of a BE in tax authorities;
- Ordering and receiving of a seal of a BE;
- Registration of data of a BE in extra-budgetary funds;
- Opening of current accounts for a BE in Turkmenistan.
BACKGROUND DATA REQUIRED FOR REGISTRATION OF A BE IN TURKMENISTAN*:
- Company name;
- Registered address (can be provided by us);
- Participant’s data (name, citizenship, passport/company’s constituent documents);
- Amount of the authorized capital;
- Kinds of activities;
- Chosen bank in Turkmenistan and kinds of accounts to be opened therewith;
- Selection of the taxation system (common, simplified);
- Other documents and data at the request of the experts of ALPS & CHASE.*
* All of the documents must be provided in advance, so we have time to translate them into Turkmenian language.
All provided documents must be notarized and legalized in the Embassy of Turkmenistan in a participant’s (shareholder’s) country or apostilled according to Hague Convention of 1961 by the relevant authorities after notarization.
For the participants from CIS countries (Russia, Belarus, Uzbekistan, Tajikistan, Armenia, Ukraine, Kyrgyzstan, Moldova, Turkmenistan, Azerbaijan, and Georgia), no apostilization or legalization of the documents is required according to the Minsk Convention on Legal Assistance and Legal Relations in Civil, Family and Criminal Cases (dated January 23, 1993) (note – depending on the kind of legal actions, there can be some exceptions in the document apostilization rules).
PRESENCE OF THE PARTICIPANTS DURING REGISTRATION OF A COMPANY:
In Turkmenistan (Ashgabat) we will be able to register your company without the founders’ presence (under a Power of Attorney). The presence of the Director General is necessary only at the opening of bank accounts in Turkmenistan.
TERM OF REGISTRATION OF A BE IN TURKMENISTAN:
Registration of a Business Entity (BE) is performed within 2.5-3 months from the date of submission of the documents to the State Committee.
One should also keep in mind the fact that time is needed for preparation and translation of the documents and getting of approval of the state authority, based on the reports of which the State Committee will make a decision on registration of a company.
APPOINTMENT OF THE GENERAL DIRECTOR IN TURKMENISTAN:
You can appoint either a citizen of Turkmenistan or a foreign citizen to a position of the General Director.
However, to appoint a foreigner, you will need a request for a license to engage foreign labour force from a Turkmen company that is willing to hire a foreigner.
A decision about issuing or denial of permits to invite foreign citizens for temporary work in Turkmenistan is made by the Committee for Control of Compliance with the Procedure of Invitation of Foreign Citizens to Temporary Work.
In case of a positive decision, an employer obtains a permit to invite and hire foreign citizens for temporary work and the foreign employees obtain an approval of the right to conduct work in Turkmenistan.
The State Service of Turkmenistan relies upon the priority of the rights of the citizens of Turkmenistan and controls a number of the citizens of Turkmenistan and foreign citizens employed by the enterprises of Turkmenistan, and the number of the latter must be no more than 30 percent of total number of employees.
Also, the presence of the Director General in Turkmenistan is often necessary for signature of the documents, interaction with the taxation and customs bodies: in this case our company can provide a service of temporary directors.
Such directors are capable of performing various administrative tasks.
The main requirement to use this service is a complete legality of the client’s business.
OTHER SERVICES IN THE AREA OF REGISTRATION OF A BUSINESS PRESENCE IN TURKMENISTAN:
Registration of Representative Offices and Branches in Turkmenistan