Starting a new business - company registration in East Timor

The Timorese government is actively promoting Timor-Leste as a place for people to do business. Timor-Leste’s low tax rate and other incentives for foreign investors qualify it as a perfect place for business. Individual and corporate tax residents are taxed at a flat 10% on taxable income. Another reason for doing business in Timor-Leste is its potential to become the 11th member of ASEAN. This means Timor-Leste will be a new member in the ASEAN Free Trade Area. With this kind of tax policy and its location closes to Australia and other major Asian countries, Timor-Leste becomes a gateway for companies hoping to expand into the emerging Asian economies, and it is a potential global hub for international investment and commerce. If you are thinking of starting a new business in Timor-Leste, below are the requirements as well as the procedures that you need to follow.

Business registration procedure

The process of registering a company is straightforward and normally could be done within two to three business days. Registered companies can open bank accounts with, and gain access to credits from banks in Timor-Leste. According to the Ministry of Justice, the steps of registering a company are listed below:

1. Complete the Certificate of Uniqueness of Company Name form. This should be processed in a maximum of 2 days.

2. Complete the Application for Business Registration form, and submit all required documents.

3. Once the documents have been verified, applicants will be issued with a “Receipt” indicating the type of registration requested and the date that the applicant should return to the Public Registry Department to collect their Business Registration Certificate.

4. After registering with the Public Registry Department, the applicant must apply for a Taxpayer Identification Number (TIN) at the National Directorate of Domestic Revenue at the Ministry of Finance, located in Colmera. There is no cost to apply for a TIN.

5. After the issuance of the Business Registration Certificate and the TIN, a Business License must be requested at the National Directorate for Domestic Commerce at the Ministry of Tourism, Commerce and Industry, located at the Fomento building in Mandarin.

Company structure

Below is the capital requirements for each type of company structure in Timor-Leste.

1. . Single Shareholder Limited Liability Company (Unip. Lda.), with 1 shareholder, and share capital of a minimum of US$5,000 and maximum of US$500,000*

2. Limited Liability Company (Lda.), with a minimum of 2 and a maximum of 30 shareholders, and share capital of a minimum of US$5,000 and maximum of US$500,000*.

3. Joint Stock Company (S.A.), with a minimum of 3 shareholders and minimum share capital of US$50,000.

The type of company structure should be varied depending on your business goal. Each type of structure has its own advantages and disadvantages. The right type of structure will ensure better tax efficiency and asset protection. If you are considering starting a new company in Timor-Leste, please feel free to contact us, and we will discuss with you the best structure for your business.