TerraLex Cross-Border Guide to Cross-Border Guide to Business Investment in Africa

Under the OHADA (Organisation for the Harmonisation of Business Law in Africa) A foreign investor can set up several legal entities in Chad, depending on the nature of the targeted activities. The most common business forms are:

• Sole Proprietorship which is an economic unit involving the use of human and material resources for production or distribution, based on a pre-established organization.
• The Public Limited Company (SA) is a company in which the shareholders are liable for the company's debts only up to the amount of their contributions, and whose shareholders' rights are represented by shares. The Public Limited Companies are generally used for large-scale projects. The mode of administration is determined by the articles of association, which choose between: Public Limited Company with Board of Directors and Public Limited Company with Managing Director.
• A Limited Liability Company (SARL) is a company in which the partners are only liable for the company's debts up to the amount of their contributions, and whose rights are represented by shares.
• A Simplified Joint-Stock Company is a company set up by one or more partners, whose bylaws freely provide for the organization and operation of the company, subject to the mandatory rules of the Uniform Act on Commercial Companies and Economic Interest Groups (Uniform Act on Business Companies and General Interest Group (GIE).
• General Partnership is a company in which all partners are merchants and are jointly and severally liable for the company's debts.
• A Limited Partnership is a company in which one or more partners who are jointly and severally liable for the company's debts, known as "associés en commandite", coexist with one or more partners liable for the company's debts up to the limit of their contributions, known as "limited partners”, and whose capital is divided into company shares. It is however, for advisable for foreign investors to set up Public Limited Company or a Limited Liability Company.

These forms of Company are governed by the Uniform Act pertaining to the Commercial Companies Act and Genega Interest Group of January 30, 2014, and the Uniform Act on General Commercial Law of December 15, 2010.

The process of registering a company under Chad law is governed by Chad law. Chad companies are governed by the Code of Commercial Companies and Economic Interest Groups (CSC-GIE).

The process for registering a company under Chad law may vary depending on the type of company you wish to set up. The most common types of company in Togo are as follows: A limited liability company (SARL), The public limited company (SA), General partnership (SNC), A limited partnership (SCS), Joint venture (SP) and Economic Interest Grouping (GIE). To register a company, you need to take the following steps:

• Obtain a negative certificate from the Business formalities center (CFE).
• Draw up the company's articles of association and have them signed by all the founders.
• File the articles of association with the CFE.
• Pay the registration fees and obtain a receipt.
• Publish a notice of incorporation in a legal gazette.

For the public limited company, the minimum share capital is 10,000,000 FCFA. For Limited Liability Companies, the minimum share capital is 1,000,000 FCFA. However, with the recent amendment, this minimum capital requirement for SARLs has been abolished. Henceforth, any interested party may set up his or her own company without the minimum share capital requirement.

For other companies, the law sets neither a minimum nor a maximum.

Exchange control rules in Chad are governed by Regulation N°02/18/CEMAC/UMAC/CM on foreign exchange in the CEMAC community. According to articles 54 and 62 of this regulation, any export or import of goods requires the submission of an export or import declaration to the customs administration or the entity acting in its stead, and a firm change of exchange which obliges the operator to repatriate and transfer the related receipts within the applicable regulatory deadlines.

The Ministry of Finance and Budget has created a department responsible for issuing export and import authorizations to comply with Béac 1 Regulation N°02. This announcement alleviates the situation experienced by Chad and traders since the entry into force on March 1, 2019, of Regulation N°02/18/CEMAC/UMAC/CM on foreign exchange in the Cémac 1 community.

Chad has no specific legal requirement for a certain number of locals (Chad nationals) to be directors of companies incorporated in Chad.

There is no legislation specifically obliging legal entities to comply with specific quotas based on demographic criteria such as gender, ethnic origin, or disability.

Periodic statutory reports must be filed with the clerk of the Commercial Court in which the company is registered. The reports are as follows:

• Annual financial statements
• Annual reports
• Tax returns
• Value-added tax (VAT) declarations
• Employee reports
• Commercial and customs declarations

• Law no. 38/PR/96 of December 11, 1996, on Chad's Labor Code.
• Chad has ratified the ILO conventions on social security and employment policy.

Foreigners need work permits to work in Chad. There are several types of work permits for foreign investors and employees. Work permits are issued by the Ministry of Public Security and Immigration in Chad. The types of work and investment permits in Chad depend on the specific situation. Temporary foreign workers must obtain a work permit to work legally in Chad. Employers participating in the Temporary Foreign Worker Program (TFWP) must carry out a labor market impact assessment (LMIA) before hiring a temporary foreign worker2. The Chadian Labor Code governs relations between employers and workers arising from employment contracts concluded for performance on the territory of the Republic of Chad. For investments, the Investment Charter of the Republic of Chad constitutes the general framework for the promotion of national and foreign private sector investments. It should be noted that the conditions for obtaining work permits may vary according to the type of permit and individual circumstances.

Foreigners wishing to acquire land in Chad may encounter land law problems. Chad's land laws are complex and can be difficult for foreigners to understand. With regard to land acquisition by foreigners, it is important to note that Chad's land laws recognize customary land rights. However, the application of these laws can be problematic due to the lack of clarity and efficiency of procedures.

• African Continental Free Trade Agreement
• The African Growth and Opportunity Act (AGOA) - Chad is a party to AGOA, which is an American trade law granting subsidies to products from 40 sub-Saharan African countries (including Chad). A U.S. trade law that grants products from 40 sub-Saharan African countries (including Nigeria) duty-free access to the U.S. market.
• The United Nations Convention on Contracts for the International Sale of Goods.
• World Trade Organization (WTO) agreements - Chad is a member of the WTO and a party to various agreements promoting international trade.
• Chad is party to various agreements that promote international trade and investment.

The Chadian government has introduced a number of reforms and tax incentives to encourage investors to invest in the country. The Republic of Chad's national investment charter provides the general framework for promoting both domestic and foreign private-sector investment. It provides for specific advantages to be granted to investments under certain conditions. This incentive-based legislative framework has gradually evolved, not only through the amendment or revision of existing texts, but also through the introduction of specific codes such as the petroleum code, the mining code and, more recently, the ordinance on public-private partnerships. The main measures introduced provide tax and customs benefits for activities in specific sectors.

The tax implications of opening and running various legal entities in Chad are governed by the General Tax Code (CGI) and the Investment Charter. In summary, Chadian companies are subject to an income tax rate of 30%, a value-added tax of 18%, a tax on profits of 5%, a tax on wages and salaries of 5% and a tax on property and real estate of

LAW N°043/PR/2014 organizing competition IN CHAD. The purpose of this law is to: - to establish the principle of price freedom in order to ensure the transparency and fairness of commercial transactions,

• to organize and promote free competition and define the rules for its protection in order to stimulate economic efficiency and improve consumer welfare, and
• create the National Competition Council.

Chad recognizes alternative dispute resolution mechanisms. The country is a signatory to the New York Convention of June 10, 1958, on the Recognition and Enforcement of Foreign Arbitral Awards. This means that foreign arbitral awards can be recognized and enforced by Chadian courts.

CHAD Law n°006/PR/2008 of January 3, 2008, instituting the Investment Charter of the Republic of Chad. This law stipulates that foreign companies benefit from the same protection as Chadian companies with regard to the protection of patents, trademarks, and all other forms of intellectual property.

CHAD Law n°006/PR/2008 of January 3, 2008, instituting the Investment Charter of the Republic of Chad. This law stipulates that foreign companies enjoy the same protection as Chadian companies with regard to the protection of patents, trademarks, and all other forms of intellectual property.

Chad has taken steps to improve the business climate and boost investment in the country's private sector. Reforms have also been launched to make the economy more competitive. Here are a few promising sectors that offer the greatest chances of profitability for foreign investors in Chad:

• Renewable energy
• Agriculture
• Infrastructure
• Mining
• Livestock
• Tourism

Chad is a country facing infrastructure challenges, particularly in the transport and energy sectors. According to the Ministry of Infrastructure and Opening-up, the Chadian government has implemented a policy aimed at improving the country's transport and opening-up infrastructure.

Improved infrastructure could have a positive impact on foreign investment in Chad. Foreign investors are often looking for a favorable business environment, which includes modern, efficient infrastructure.

The risks associated with investing in Chad include economic vulnerability, low business diversity, underdeveloped infrastructure, political and security concerns, and regulatory challenges.

To mitigate these risks, investors need to exercise due diligence, seek out local partners with a good track record, understand the business culture, and obtain legal advice.