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 Mali, 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. 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.

To register a company in Mali, you need to follow the administrative formalities put in place by the law of May 13, 2008. The opening of the one-stop shop for business start-ups is in line with this law. The one-stop shop for business start-ups is a single point of contact for business start-ups. It enables businesses to be set up within 72 hours.

The procedure for setting up a business in Mali is limited to simple formalities to be completed at the API-Mali One-Stop Shop, in accordance with government decree. Once the file has been set up and submitted, the procedure follows the following stages: collection of the RCCM certificate, the NIMA certificate and the tax identification card, collection of the newspaper containing the advertisement, obtaining the RCCM certificate, the NIMA certificate and the tax identification card.

For the Public Limited Company, the minimum share capital is FCFA 10,000,000. For Limited Liability Companies, the minimum share capital is FCFA 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 are set out in regulation n°09/2002/ CM/WAEMU of September 26, 2022, relating to the freedom of capital transfers within WAEMU member states. This regulation sets out the conditions and procedures applicable to capital transfers between WAEMU member states and between these states and third countries.

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

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 n°97-17 of December 1, 1997, on the Labor Code
• Decree no. 2006-1256 of November 15, 2006, setting out employers' obligations in terms of workplace safety
• Law N°2019-025 of July 05, 2019, amending law n°92-020 of September 23, 1992
• Law 99-041 of August 12, 1999, on the social welfare code

The types of work permit for foreign investors and employees in Mali depend on the nature of the job and the length of stay. Work permits are issued by the Ministry of Labor, Civil Service, and Institutional Relations. Types of work permits include: - Temporary work permit: This permit is intended for foreigners wishing to work in Mali for a limited period. It is valid for a maximum of one year and can be renewed.

• Permanent work permit: This permit is intended for foreigners who wish to work in Mali for an indefinite period. It is valid for a maximum of 10 years and may be renewed.
• Work permit for investors: This permit is intended for foreign investors wishing to set up a business in Mali or invest in the country.

The PHE (Procédure Harmonisée d'Embauche) is a simplified process for obtaining a temporary work permit for foreigners working in private companies in Mali. PHE enables employers to obtain a temporary work permit in less than a week.

Foreigners wishing to acquire land in Mali may encounter legal problems. The most common problems relate to land ownership, leasing, and acquisition. Foreigners may find it difficult to obtain land titles, as Malian law prohibits foreigners from owning land in certain areas of the country. Foreigners may also encounter problems when leasing land, as lease contracts are not always respected. Finally, foreigners can encounter problems when buying land, as land transactions are not always properly registered and title deeds are not always clear.

• Economic Partnership Agreement (EPA) between the European Union and West Africa (Mali)
• African Continental Free Trade Agreement
• United Nations Convention on the International Sale of Goods
• Economic Community of West African States (ECOWAS) Trade Liberalization Scheme (ETLS) - the ETLS is a regional trade agreement designed to promote intra-regional trade and investment between ECOWAS member countries.
• World Trade Organization (WTO) agreements - Mali is a member of the WTO and is party to various agreements that promote international trade.
• Mali is part of various agreements that promote international trade and investment.

In Mali, the government has put in place a number of policies and incentives. According to a UN investment guide, Mali has put in place measures to improve the business climate, such as creating a one-stop shop for investors, reducing the time it takes to set up a business and simplifying administrative procedures. The government has also created an investment promotion agency to help investors navigate the investment process and obtain information on investment opportunities.

The tax implications of opening and managing legal entities in Mali are governed by the General Tax Code (CGI) and the Investment Code. Legal entities are subject to corporate income tax (IS) and value-added tax (VAT).

Companies are required to file an annual tax return and pay corporate income tax on their profits. Tax rates vary according to company type, sales, and location.

As far as VAT is concerned, companies must register with the Direction Nationale des Impôts (DNI) and collect VAT on sales. VAT rates vary according to the type of product or service sold.

In Mali the National Assembly adopted a new law n°28 of April 08, 2016, on the organization of competition, which broadens and specifies the definitions of anti-competitive or competition-restricting practices, increases penalties and institutes a national competition commission.

Mali 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 Malian courts.

Mali has enacted Law N° 2012-016 / Of February 27, 2012, Portant Code Des Investissements. This law stipulates that foreign investors receive the same treatment as investors of Malian nationality subject to provisions contrary to the laws or treaties and agreements concluded by the Republic of Mali with the States of which they are nationals.

The current state of Mali's investment climate is relatively weak, with significant obstacles to investment, including political instability, allegations of corruption, poor infrastructure, and persistent insecurity throughout the country. However, the Malian government has taken steps to improve the investment climate. Reports from business contacts indicate that both Malian and foreign companies face corruption in procurement procedures, customs procedures, tax payments and land administration. The U.S. State Department has published a statement on the investment climate in Mali, which provides information on the business climates of over 170 economies and is prepared by economic officials stationed in embassies and posts around the world.

Mali has undertaken measures to improve the business climate and boost investment in the Malian private sector. Reforms have also been launched to ensure a more competitive economy. Here are a few promising sectors that offer the greatest chances of profitability for foreign investors in Mali:

• Renewable energy
• Agricultural
• Mining
• Tourism
• Agribusiness
• Handicrafts

Infrastructure in Mali includes roads, bridges, dams, airports, ports, and railroads. The Malian government has launched several infrastructure projects to improve living conditions for the population and stimulate economic growth. However, the lack of infrastructure investment in the country is a major obstacle to foreign investment.

The risks associated with investing in Mali include economic vulnerability, low business diversity, underdeveloped infrastructure, political and security concerns, regulatory challenges, and corruption. To mitigate these risks, investors should exercise due diligence, seek out local partners with a good track record, understand the business culture, and obtain legal advice.