The main forms of Georgian businesses are divided into companies and partnerships. The investors may choose between companies with limited liability or joint stock companies. The partnerships that can be set up in Georgia may be general or limited. Also, foreign companies may enter the local market by opening a subsidiary or a branch office and our team of specialists in company registration in Georgia can provide in-depth assistance on these business structures.

The types of companies in Georgia

A limited liability company (LLC) 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. Other characteristics of the LLC are the following:

• it is the most common type of business registered in Georgia, preferred by both foreign and local businessmen;
• the LLC can be set up by natural persons, but legal entities are also allowed to register this business form;
• the share capital of the LLC is divided into shares and the investors can’t issue additional shares;
• the registration of this business form can last approximately two weeks.

The joint stock companies are business forms 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 and it is important to know that the investors of this type of company may issue additional 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/her contribution to the company’s capital.

Furthermore, foreign investors can operate on the local market through a branch office, which is a type of company that is managed and controlled by the foreign company abroad. In this case, the parent company is held responsible for any debts and financial difficulties related to the branch office registered in Georgia.

How can an investor register a Georgian company?

All the Georgian legal entities must be registered with the National Agency of the Public Registry subordonated to the Ministry of Justice in Georgia. The registration of the companies is based on a signed and notarized application. The application must include a set of information, such as the name of the company, the type of company, its address, the purposes for which it was set up as well as the following:

• date of starting the business and a notarized copy of the company’s statutory documents;
• details regarding the founder of the company (name, address, place of birth and the profession),
• the amount of share capital and details regarding the contribution of each partner;
• documents regarding 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 of 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 mentioned documents along with the proof of registration fee payment, the company will receive an identification number and a certificate of state and a tax registration; our team of specialists in company formation in Georgia can provide more details related to this matter.

The fee ranges from GEL 100 in the situation of the standard registration, but the investors may opt for a faster registration, in which case they will have to pay a fee of GEL 200. The last step before starting the actual economical activity is opening a bank account. The registration with the National Agency of the Public Registry lasts 1-2 days.

Information regarding the Georgian economy

Georgia is situated in a strategic area, connecting Asia to Europe, and this offers the country a competitive advantage - it is seen as a desirable location for foreign investors. The well developed infrastructure helps 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 them has decreased to only six. The VAT is imposed at a rate of 18%, the corporate tax rate is 15% and dividends distributed by a company are subject to a 5% dividend tax rate.

Another reason why the investors are interested in opening companies in Georgia is the simplified registration procedure of a business. The process of registration of a new company doesn’t take longer than two days, as mentioned above, but the entire registration process can take longer, if we consider the registration with the local institutions, obtaining specific business permits and other necessary steps.

The Georgian workforce is well trained and the country is situated on the 1st place in the world in the Adult Literacy Rate indicator (with a rate of 100%). The country also benefits from a young workforce and this can provide numerous advantages to foreign businessmen who are seeking to expand on this market.

For more details regarding the registration of a company in Georgia, we invite you to contact our specialists in company formation, who can offer further information on any aspect concerning the registration procedure. Investors may also request assistance on the tax regulations applicable to a specific business structure.

Comments

Mohammad 2017-07-02
I want to appreciate you for providing the summarized information about registering company.
Sahar 2018-05-28
Hello and respect, I want to know what kinds of companies are registered in Georgia?
Benjamin 2018-08-23
A very detailed article, that provided a clear image on the registration procedure!

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