Registering a company in Morocco is quick and easy

Setting up a company in Morocco is extremely simple. Commercial law, and employment law if you have employees, is very similar to French law, but much less comprehensive, or “simpler” as others might say. What’s more, everything is done to make life easier for you, the foreign investor. In particular, all the formalities are handled by a single point of contact: the Regional Investment Centre, or CRI.

Forms of company or business activity

In Morocco, it’s fairly easy to operate as an individual. This has the same disadvantages as in Europe: you are fully liable for your personal assets. You also have to be resident in Morocco.

The three most common forms of company are:

• single-member limited liability company, in French “société à responsabilité limitée d’associé unique” (SARL A.U.)
• the classical limited liability company, in French “société à responsabilité limitée” (SARL)
• public limited company, in French “société anonyme” (SA)

As you can see, we are very close to traditional commercial law, and even closer to French law. Other legal forms (simplified public limited company, limited partnership and partnership limited by shares, general partnership) are rare. In the case of setting up subsidiaries, off-shoring or a major project, it is also possible to set up a Economic Interest Grouping (in French “Groupement d’Intérêt Economique” or G.I.E. or a joint venture).

The difference between the SARL A.U. and the SARL is not just the number of partners. Here is a comparison of the two forms:

As for the public limited company, that’s something else:

For our first post, we’ll leave it at that! The type of company you choose will depend on your business and your financing needs. As everywhere, the public limited company is more complex and heavier to manage, and therefore more expensive. The choice between SARL A.U. and SARL will essentially depend on your personal and family situation.

Minimum paid-up capital: you will often see a minimum capital of 10,000 dirhams for the SARL. In fact, in June 2011, the law changed, and there is no longer a minimum capital requirement for this type of company. One dirham is enough to set up an SARL in Morocco.

Post 46 amended by law 24-10 states that

The capital of a limited liability company is freely determined by the partners in the Articles of Association. The share capital is divided into shares of equal par value. The Articles of Association define the distribution of shares.

The negative certificate: the “brand” and the company name

Once the legal form has been chosen, it needs a name. This requires a negative certificate, which can be obtained from the Regional Investment Centre.

Two different forms are available, one for company names and the other for business names. It is advisable to submit five different names, in order of preference, to avoid making several applications if the name chosen first is already taken.

The form must be submitted together with a copy of the applicant’s identity card or passport, if he or she is not a resident.

Once the name has been found, the C.R.I. issues the certificate. This paper certifies that there is no other company with the same or a very similar name in Morocco. It is necessary in order to set up your company.

It is NOT a trademark registration, but if your business name is your company’s only ‘brand’, then it is more than sufficient in Morocco.

The C.R.I. can also register a trademark, and even internationally.

Once you have your precious Negative Certificate, you have one year to set up your company. After that, you are free to use your chosen name.

Price of negative certificate : 210 dirhams, payable in cash on site or 126 dirhams online.

The Articles of Association

The Articles of Association are usually drawn up by the chartered accountant or law firm you have asked to set up the company. There are many different types of Articles of Association, and we have selected a model for our newsletter subscribers.

Two recommendations:

• make the corporate object as broad as possible, and include an import-export activity (this is essential for obtaining a convertible dirham account)
• print in small type, single-spaced, with minimum margins, on both sides of the page: many copies will need to be legalised, with one tax stamp per page. And these are not the only documents required. After a while…

Capital transfer

If you choose to have capital of more than a few dirhams (which is good for your credibility with the bank and your various partners), you will need to deposit it in a bank account.

So you choose your bank. Again, Bernard and I will come back to this in detail, but choosing a bank because it is a correspondent of your bank in Europe is often a very bad idea.

To quote a Moroccan living in France about a bank:

I can’t wait for a French bank to get in on the act, because the bourgeois spirit of the village is a disaster. They’re holding not a hair but a palm tree in their hands.

and I fully agree… basically, and before going into detail in a future post: choose BMCE. Because unfortunately, it’s not just a problem of palm trees, but often of skills.

If you have a company with less than 100,000 dirhams in capital, the capital freeze is no longer necessary (it is maintained above 100,000 dirhams, to avoid companies with fictitious capital).

Registering the company with the tax authorities

The documents required to register the company are:

• the original lease agreement or company registration certificate
• the original articles of association
• four legalised copies of these two documents (with a stamp of 20 dirhams per page)
• your original identity document and a copy (no need to legalise it)

In return, you will receive your payment receipts and four copies officially registered by the tax authorities.

Company registration fee: 200 dirhams, plus stamps for legalisation

Creation of the company itself

The documents required are:

• Articles of Association (original + three single copies)
• Minutes of the Extraordinary General Meeting and of the Board of Directors meeting appointing the manager (original + three single copies)
• If the activity is regulated (medical profession, travel agency, etc.), document proving authorisation to practise (original + five single copies)
• Negative certificate (original + two single copies)
• Registered lease (original + two single copies)
• Blocking certificate, if applicable, for capital in excess of 1000,000 dirhams (original + two single copies)

which will enable you to obtain “Registered Statutes” and move on to the second stage. This time, armed with

• your identity document (five single copies)
• the manager’s declaration of honour (five originals)
• the single form, in Arabic or French (original)
• the original negative certificate with two legalized copies
• the original lease contract, with two authenticated copies
• two originals and three legalized copies of the articles of association signed by the partners and registered previously
• and, if applicable, 5 authenticated copies of the document authorising the company to carry on a regulated activity and the certificate of blocking, together with two authenticated copies.

… your hand starts to hurt from signing, and you receive … a receipt for submitting your application.

Which, above all, will enable you to obtain your sesame:

• your commercial court registration numbers, your patent number and your tax identification number
• your certificate of registration for business tax
• an application to join the CNSS, which must be made within one month of taking on your first employee
• and a receipt.

Your company now exists!

How much does it cost : 400 dirhams + 1% of share capital, to be paid in cash (plus a large number of stamps at 20 dirhams)

The publication

The head of the C.R.I. will help you to fill in the form for publication in the Bulletin Officiel, as this is only available in Arabic. You can also publish an advert in a legal gazette. You will need to fill in the form with the text of the advertisement, and submit a copy of the trade register and the negative certificate.

How much does it cost: 4 dirhams per line published (usually around 40) in the Bulletin Officiel, and 9.60 dirhams per line published in the newspaper.

A few tips for setting up a company

Choosing your registered office

We’ll come back to this later, but there are several free trade zones in Morocco, where you can enjoy certain advantages. However, setting up in one of these zones also involves some constraints.

There are some business incubator programmes, which can be very interesting for an SME.

So the choice of head office location is important.

Putting the competition to work

There are lots of law firms and accountants. As a foreigner, you will tend to be overcharged. Use the competition, check with the consulate to find out who they recommend, but also look elsewhere.

This also applies to domiciliation companies.

There isn’t much feedback on expat forums, but ask around and, above all, don’t limit yourself to “service providers for foreigners”. While some are efficient, others have simply managed to make a good cheese of themselves and take advantage of the newcomer’s ignorance to hang around and charge a lot.

All the formalities take place in two places: the tax centre and the investment centre. In most cases, the tax office has a branch at the investment centre. If you take the precaution of making all the necessary legalized copies in advance (which is done at the police station), the formalities can be completed very quickly.

Don’t close any doors, we’re in Morocco

Although it is much more efficient than it was a few years ago, because Morocco looks after its investors, especially foreign investors, this first contact with the Moroccan legal and administrative world may surprise you.

It’s a good time to start understanding how things work and, thanks to your friendliness, to make your first contacts, who will be able to help you later, even if it’s only to find the right person to talk to.

Start your company small but not limited

As you have seen, there is a lot of paperwork to be done, and some of the costs depend on the amount of capital.

There’s no need to go overboard: invest as little money as possible directly. On the other hand, be as broad as possible in the definition of your corporate object, and as light and as informal as possible in the definition of your procedures in the Articles of Association. For example, provide for shareholders to be convened by e-mail, or for meetings to be held by telematic means…

What happens next?

There are still many points to be addressed, including:

• all aspects of employment law and personnel management
• everything to do with working with the accountant, and how much it costs
• managing expatriates through a company
• a brief look at regulated professions
• a broader look at investment aid and free trade zones

And what about you? Did you learn anything from this post?

What questions would you like to ask us in the comments?

Bernard and I will answer you as best we can.

A typo or syntax error? You can select the text and hit Ctrl+Enter to send us a message. Thank you! If this post interested you, maybe you can also leave a comment. We'd love to exchange with you !