The main forms of Georgian businesses are divided into companies and partnerships. The companies may be with limited liability or joint stock companies. The partnerships may be general or limited.
A limited liability company is formed by maximum 50 shareholders and the capital is divided into shares. The liability of the members is strictly limited to the value of their shares. The shares are freely transferable and the members are not allowed to withdraw from the company.
The joint stock companies are the companies with the capital divided into shares with equal nominal value. It can be formed by more than 50 members, unlike the limited liability company. The members of the joint stock companies have the responsibilities limited to the nominal value of their shares.
A general partnership is formed by two or more partners, equally liable for the company’s profits and losses. They both have decisional powers.
The limited liability partnerships in Georgia are formed by at least one general partner and one limited partner. The general partner carries the full responsibility for the company’s debts and incomes, unlike the limited partner who has limited responsibilities in extend of his contributions to the company’s capital.
All the Georgian legal entities must be registered in the National Agency of the Public Registry of the Ministry of Justice of Georgia (National Agency).
The registration of the companies is based on a signed and notarized application. The application must state:
- the name of the company,
- the type of company,
- the goals,
- date of starting the business,
- date of termination of the year,
- details regarding the founder of the company (name, address, place of birth and the profession),
- the amount of share capital and details regarding every contribution of each partner,
- documents of naming each member of the supervisory board and management board.
The application must be accompanied by the charter of company, the documents showing the value of the contributions made in kind, a proof from the Information Center of the Ministry of Internal Affairs that the persons appointed to represent the company are not subject to penalty for proprietary offences, the documents of appointment for the directors and members of the councils.
If necessary, all the documents must be accompanied by the notarized and legalized translation into Georgian.
A registration fee must be paid before the company is registered in the Entrepreneurial Register. After submitting all the above documents along with the proof of registration fee payment, the company will receive an identification number, a certificate of state and a tax registration.
The last step before starting the actual economical activity is opening a bank account.
All the procedure of registration doesn’t take longer than 2 days.
Georgia is situated in a very strategic area, connecting Asia to Europe, this conferring it the status of desirable location for the foreign investors. The well developed infrastructure is helping the import and export of goods all over the world.
Georgia is also known for its various reforms made in all the sectors, in its attempt to attract the foreign investments.
The financial system is encouraging - even though in 2004 there were 21 taxes, the number of it has decreased to only six. The VAT is 18%, the income tax rate is 6% and dividends distributed by a company are subject to a 5% dividend tax rate.
Another reason why the investors are willing to open companies in Georgia is the simplified opening business procedure. The whole process of registration of a new company doesn’t take longer than two days.
The Georgian work force is well trained and at low costs. It is being known that Georgia is on the 1st place in the world in the Adult Literacy Rate indicator (with a rate of 99.8%).
For more details about registering a company in Georgia, you may contact our specialists in company formation.