The basic legal forms of companies established by foreign investors in accordance with Moroccan law are as follows:

* Private limited liability company (SARL)
* Public company limited by shares (SA)

Private limited liability company (SARL)

Private limited liability company (SARL) may be established by one participant (physical or legal person, resident or non-resident) and is characterised as follows:

* minimum charter capital is MAD 100’000 (US$1 is approximately MAD10);
* entire capital needs to be paid up upon incorporation;
* only registered shares that cannot be transferred to third parties without the other participants’ approval may be issued;
* company may be managed by one director;
* director may not be a shareholder;
* directors and shareholders may be non-residents of Morocco;

Public company limited by shares (SA)

Public company limited by shares (SA) may be established by five or more participants (physical or legal persons) who are liable only to the extent of their participation interests in the share capital, and is characterised as follows:

* minimum share capital is MAD 300’000;
* if the capital is paid in cash, a quarter of the capital must be paid prior to registration. If the capital is paid by non-monetary assets, the capital must be paid up in full;
* both registered and bearer shares may be issued;
* shares may be sold and transferred to third parties;
* company is managed by the Board of Directors composed of three to twelve members;
* directors must be shareholders of the company;
* directors and shareholders may be non-residents of Morocco.

Physical and legal persons engaged in business operations in Morocco are charged with business tax. The tax includes a tax imposed on the company’s real estate (leased or owned) and a fixed amount depending on the type of entrepreneurial activity. The tax rate varies from 5% to 30%.

Income received by companies from agricultural operations is subject to preferential taxation.

Income received by companies from export operations is not charged in Morocco within the first five years.

Moroccan companies established in Western Sahara are not subject to corporate income tax.

Interests, considerations, profits and service fees are subject to corporate income tax.

Dividends and royalties received by foreign shareholders of companies registered in Morocco are subject to withholding tax.

Profits from capital gains and company shares are also subject to taxation.

Standard VAT rate is 20%.

Morocco is not a tax heaven or offshore jurisdiction, and a concept of Morocco tax exempt company (and/or Morocco offshore company, trust, foundation etc. registration) does not exist in Morocco as such. A company formation in Morocco could be arranged with a professional registered agent providing incorporation, virtual office and other corporate services in Morocco. To set up a company in Morocco is possible by correspondence, but to open a bank account in Morocco will, most probably, require a personal visit.

Morocco Double Taxation Agreements

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