Company Registration in Rwanda

Rwanda is often praised for its limitless business potential, apart from being the strongest contender among African nations- all thanks to a formidable law and political framework. The nation has an ample youth population, catering to different businesses across major sectors.

As with other nations, Rwanda has several legal implications that should be mandatorily followed by those seeking a new venture. Let’s see what they are and how you can address them effectively.

Analyzing Rwanda’s Potential from the Business Standpoint

Economic Growth

The last decade's growth of 7 percent marked the unprecedented potential of Rwanda’s economy. The country has policies that promote international business and foreign investment, paving a roadmap for a brighter future.

Political Stability

The nation fosters much-needed political stability and governance that allows for easy entry and exit for businesses no matter the domain.

Strategic Location

Rwanda provides access to the East African market, which comprises over 10 million customer base.

Government Initiatives

The growth-seeking sectors like agriculture, science, and technology education have required leverage of the Rwandan government, propelling them in the right direction. According to the Rwanda Vision 2020, these sectors shall be developed dynamically, creating scope for ample investment opportunities.

Market Potential

With ever-improving per capita income and a healthy population, Rwanda has a robust market presence, ideal for diverse businesses.

Ease of Doing Business

Rwanda's commitment to simplifying the registration process and business onboarding strengthens the nation’s ambition of being a global powerhouse. The recently employed system has gotten rid of excessive paperwork and unnecessary processes, allowing for prompt and hassle-free registration.

Skilled Workforce

The nation fosters a contemporary education system that helps shape the workforce to be industry-ready and productive, meeting the demands of diverse businesses.

Affordability

The workforce in Rwanda is ubiquitous and cost-effective, ensuring low operational costs for budget-conscious companies.

Incentives for Investors

The government's implementation of policies, incentives, and promotional campaigns aims to ease the process of company registration and encourage both local and foreign investors.

Expanded Access to Credit

Amendments to the law allowing an expanded definition of collateral in loans facilitates easier access to credit, supporting businesses in their growth and development initiatives.

Process

The Rwanda Development Board (RDB) regulates the registration affairs comprehensively. Owing to the new system, registration has become dramatically quicker, allowing most companies to get registered within a day. Here’s how the process pans out:

Step 1: Registering on the RDB Business Registration System

The road to business registration begins with accessing the RDB portal, a sole platform for registering and formalizing entities seeking to operate in Rwanda. 

Step 2: Selecting the Desired Business Category for Registration:

While accessing the portal, the application shall confront the requirement for choosing the applicable business category. You can choose from a variety of options available such as Limited Liability Companies (LLC), Public Limited Companies (PLC), Branch Offices, and Representative Offices, each adhering to specific norms.

Step 3: Filling out the Business Registration Form Based on the Chosen Entity:

Upon selecting the desired business category, proceed with filling out the registration form. This document entails key details about the business, including its structure, directors, and shareholders. The information to be added to the form shall vary based on the selected business type.

Step 4: Obtaining Printed Copies of Essential Certificates:

After submitting the business registration form, entrepreneurs must obtain hard copies of crucial certificates, including AoA and MoA. Do not forget to secure the Value-Added Tax (VAT) certificate, signifying the business’s compliance with tax norms.

Step 5: Completing the Registration, Declaration, and Payment of Taxes:

The final stages involve completing the formalities with the RDB. This includes the facilitation of mandatory dossiers, declaration of business chores, and the payment of any applicable taxes.

Documents

The list below entails documentation that is key to the registration process:

Power of Attorney: Need by an agent to act on behalf of the applicant.

Authenticated Memorandum and Articles of Association: A foundational document outlining the company's structure, shareholding, and internal rules.

Local certificate or business-specific documents: needed by specific businesses.

Notarized Resolution: Authorizing the branch's opening, issued by the relevant agency.

Passport Copies: required by shareholders and directors.

National ID or Passport: Valid identification proof for shareholders, directors, and applicants.

Business structure

When considering company registration in Rwanda, four distinct business entities are available:

Limited Liability Companies: Popular among SMEs, requiring a minimum of one shareholder, one director, and a minimum share capital of US$850.

Public Limited Company (PLC): Allows 100 percent overseas ownership, with the entity's operation scope figured out by the parent company.

Branch Offices: Separate legal entities with separate administration and access to corporate banking services.

Representative Offices: Engaged in market research and promotional chores for the parent company, with no connection with profit-making activities.

Eligibility

Following eligibility requirements must be fulfilled for Company Registration in Rwanda:

Age and Mental Soundness: Applicants should have acquired a legal age i.e. 18 years with no mental illnesses.

Legal Documentation: Submission of foundational paperwork such as the Memorandum of Association and Articles of Association is mandatory.

Sufficient Capital: Maintaining the required capital is vital for reinforcing the legal existence of the company.

Director and Shareholder Details: Furnishing details of directors, shareholders, and the company's address is also crucial.

Business Mission: The presence of a pragmatic business's mission and its inclusion in MoA is important.

Identification Proof: The availability of proof such as a National ID or passport for all shareholders and directors is vitally important.

Residency Status: A local resident or foreigner is eligible to apply for company registration. The latter must have valid authorization to stay in the country.

Companies operating in Rwanda typically attract the following taxes:

Corporate Income Tax (CIT):  a minimum tax rate of 30% is imposed on local and foreign corporations.

Value Added Tax (VAT): 18 percent on the transaction of commodities and services and their import.

Withholding Tax (WHT): Levied at 15% on interest, dividends, royalties, technical and management fees.

Capital Gains Tax (CGT): Imposed at a 5% rate on the gains arising from the sale of the company’s assets.

Excise Tax: Charged at varying rates, disclosed, and paid to the Rwanda Revenue Authority.

Give your Dream Venture wings of success with Adviso Support

Adviso’s services in the Global incorportion realm are remarkable and second to none. With in-depth know-how on cross-border compliances and regulatory affairs, we take pride in stimulating your global endeavors and letting you start the way you want. Our pool of experts will help you comprehend the entire process of business launch in a layman's way.

Let’s get started and take a stride that matters for a seamless business launch in Rwanda!.