Reserve a unique company name
Agency: Ministry of Trade or Trade Bureau at sub-city level
The entrepreneur can reserve the unique company name. According to the Commercial Code, the company name shall be as agreed but shall not. offend public policy nor the rights of third parties.
The entrepreneur completes a simple form and submits it to the agent at window No. 1. The service is partially computerized and the search is quick. A Letter of Recommendation (LR) will be given by the agent and must be attached to the Memorandum and Articles of Association for authentication.
Once a name is reserved, a confirmation letter is issued by the Ministry/Bureau addressed to the Ethiopian Revenues and Customs Authority. This letter will enable the company to sign the bylaws at the notary and obtain a tax registration certificate.
Time and cost: 1 day, ETB 27
Authentication of the company documents and the lease agreement at the Documents Authentication and Registration Office (DARO)
Agency: Documents Authentication and Registration Office (DARO)
Article 11 (1) (e) of Commercial Registration and Business Licensing Proclamation No. 686/2010, the Memorandum and Articles of Associations must be authenticated. The entrepreneur deposits the documents at DARO and will be given an appointment for the next day. The Documents Authentication and Registration Office verifies the in-kind contribution stated in the Memorandum. The partners appear in person at the appointed date, with an original copy of their letter of appointment (power of attorney) and a valid identity card. The officer checks the validity of the documents, the authenticity of the signatures, and the genuineness of the identity cards. All partners sign the documents before the notary public and pay a stamp duty flat fee of ETB 350, as well as100 ETB /4 copy and Birr 1 per additional person Payment is done in the same office where the documents are being registered in the books.
Time and cost: 2 days, ETB 451
Obtain a tax identification number (TIN)
Agency: Ethiopian Revenue and Customs Authority
Before incorporation, the company must obtain a tax identification number by completing and submitting an application form together with its memorandum and articles of association. A taxpayer registration certificate will then be issued to the company for submission at the sub-city along with its application for incorporation.
Time and cost: 1 day, no charge
Register the company and obtain the Commercial registration certificate
Agency: Commercial Register
The applicant registers the Memorandum and Articles of Association. After reviewing the documents, including the lease agreement, the Commercial register delivers a registration certificate. Payment is done at the same time.
Time and cost: 1 day, ETB 102
Make a company seal
Agency: Seal maker
While the law does not specifically require a company to have a seal, it is required and commonly used in practice. The seal maker is a private service provider thus, the pace of its service delivery depends on its cost, reputation and quality. The seal maker will require the business license and TIN of the company.
Time and cost: 1 – 3 days, ETB 550
Register the company and employees with the Private Organization Employees’ Pension Fund
Agency: Private Organizations Employees Social Security Agency (POESSA)
According to Article 4 of the Private Organization Employees Pension Proclamation No. 715/2011 enacted June 2011, any private organization shall, for the purpose of registration, submit to the agency copies of its establishment law, personal data of its employees taken at the time of first employment, letter of employment issued to the employee and other particulars determined by the Agency within 60 days from the date of establishment of the company or employment.
Time and cost: 1 day (simultaneous), no charge
Register with Ethiopian Revenue and Customs Authority for VAT
Agency: Ethiopian Revenue and Customs Authority
A newly established firm must register for VAT if its turnover is at least ETB 500,000 on the basis of VAT Proclamation No. 285/2002, Article 16. Article 16 (1) (b) of the VAT Proclamation and Article 4 (3) of Directive No. 25/2009, A Directive for VAT registration states that persons engaged in the following business activities have the obligation to register; importers, manufacturers of plastics and plastic products, shoe factories, contractors above Grade 10, computers and accessories shops, manufacturers and sellers of leather and leather products, electronic shops and jewelry shops. Once registered, the VAT certificate is obtained.
Time and cost: 1 day, no charge
Publish name in nationwide newspaper
Agency: Ethiopian Press Agency
In order to insure the availability of the name, companies publish the name for 15 days in a national newspaper. If after 15 days no objection is lodged, the company applies for the name registration certificate.
Time and cost: 15 days, ETB 300
Reserve a unique trade name
Agency: Ministry of Trade or Trade Bureau at sub-city level
After publication in the newspaper, the company can continue to register for the trade name and pay all relevant fees. Article 24 (1) of the 2010 Commercial Registration and Business Licensing Proclamation states that any person desiring to engage in a commercial activity shall register his trade name at the place where he is registering in the commercial register.
Before the registration of a trade name in the commercial register and in the trade name register, it shall be verified that another business person has not got the trade name registered in the trade name register or in the commercial register.
Time and cost: 1 day, ETB 27
Obtain a business license
Agency: Ministry of Trade or Trade Bureau at the sub-city level
A business license must be obtained. The applicant must present the Principal Registration, a proof of the new Tax Identification Number and pay the relevant fees. For certain categories of businesses, a certificate of competence in the field of commercial activity in which the applicant is seeking a business license may also be required. The Business License is usually issued on the same day these documents are submitted.
Time and cost: 1 day, ETB 102
Install a cash registration machine
Agency: Ethiopian Revenue and Customs Authority, Point of sales software providers, and Cash register machine hardware providers
Pursuant to the Council of Ministers Regulations No. 139/2007 ‘To Provide for the Obligatory Use of Sales Register Machines’, all businesses must purchase and install a sales register machine in order to comply with VAT tax obligations. The machines are available at certified supplier locations around Addis Ababa. Once the machine is brought to the company offices, it must be properly installed and set up so that it is linked to the Tax Administration system.
Time and cost: 7 days on average, ETB 5,000-10,000
