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Understand the Jurisdictions Setup Requirement Before Proceed Your Register Company in Ecuador
The spotlight is on Ecuador, a nation that is becoming a favorite for investors looking to register a company. The low cost of living is one of the many reasons why entrepreneurs are now turning their eyes towards Ecuador as a potentially profitable business destination, but there are other reasons that has helped the country boost its standing amongst the international business crowd.
Why Choose Ecuador
The mining industry in Ecuador is a huge allure for international investors, especially entrepreneurs who are thinking about venturing into oil and gas, forestry and mining since these sectors are eligible for 100% corporate tax exemption for up to 12 years.
Investors also stand to benefit in some of the country’s private sectors where corporate tax exemption is available for up to 5 years, as long as the projects involved are undertaken outside Quito and Guayaquil.
Investors who are registering a company in Ecuador’s free zones will also gain from the 100% exemption on taxes (VAT, provincial taxes, municipal taxes and import duties included).
Benefits of Registering a Company in Ecuador
Investors who are keen to setup a business in Ecuador will be pleased to note that they will be able to do so effectively as long as they have one director and three shareholders in place. The good news is, getting the director and shareholder should be a fairly straightforward process, made easier especially because they can be people of any nationality.
Does this mean 100% foreign ownership of a business is allowed in Ecuador? Yes, it does.
Another benefit that comes with registering a company in Ecuador is the low minimum share capital rate required, which is a minimum of US$400. A very affordable sum compared to a lot of other jurisdictions, which is why company registration in Ecuador is so favorable.
Yet another benefit to doing business in Ecuador is the ease of currency use, because back in 2000, the country adopted the US dollar as its national currency, a move which has helped Ecuador stabilize its economy and given a boost to the international investments that have been flowing into the country ever since. Businesses will find it easy to manage their operational costs because of the stable exchange rate.
Infrastructure projects in the country have also taken a positive turn, thanks to the record oil revenues which Ecuador is pulling in.
How to Register a Business in Ecuador
To begin registering a company in Ecuador, here is what you need to do:
- Reserve a company name at the Superintendence of Companies.
- Begin preparing the minutes of incorporation (you will need to hire a lawyer for this).
- Get your charter of incorporation and bylaws notarized with a notary public.
- Get your company registered with the Superintendence of Companies.
- Get your company’s charter, resolutions and name of legal representatives registered in the Mercantile Registry Office.
- Apply for a Tax Identification Number with the Tax Authorities in Ecuador.
- Find an authorized print shop to get your invoices and VAT forms printed.
- Register for Social Security (this can be done online and you will need a password).
- Register your employees with the Ministry of Labor.
- Acquire the necessary Operations Permit with the Municipality of Quito.