• One year income tax holiday with an initial investment of at least $5,000 or a 6% (or 10% if at least 80% of produced goods/services are exported) reduction in income tax if the investment amounts to at least $100,000 (Article 4 and 5).
• If at least $20,000 of investment is made in regions approved by government, net income (for the purposes of income taxes) can be reduced by 20% or 10% if at least $1,000 of investment is made in an environmentally protected area (Article 6).
• After the first and up to the ninth year that a company/manufacturer has started, the company is free from the levying of income tax (Article 9) if:
  a) profit is from a new business.
  b) it is working in agriculture, herding, aquaculture, forestry, mining, or tourism.
  c) company doesn't use facilities of Articles 4,5,6,8, or 13.
  d) if the company complies with rules on investering and number of jobs created.
• No import duty on goods brought in for business resources if import value is at least $10,000 or on goods used to make a product if value is at least $5,000 if goods are used within one year (Article 10-11)
• If a investor invests in an area chosen by the government, person who is responsible for taxes may take a tax reduction of 10% of the total wages paid to their workers (cannot be greater that income tax taxed on wages) for a total of 5 years (Article 13)
  
  Limitations
• To benefit from the various incentives, entrepreneurs must submit requests within certain time frames.
• Information submitted to InvestSur is confidential (Article 21).
• Investments of more than USD 50.000.000 for mining of bauxite, hydrocarbon material, gold, and radioactive minerals are eligible for special investment incentives (Article 25).

Choice of business structure
There are a number of factors to consider when choosing an investment opportunity in Suriname.

Licensing
To gain a license, applicants must pay about US$10 and supply a declaration of the tax office that a person has no tax arrears or a settlement agreement, a health certificate, a birth certificate, a certificate of credibility, a letter from the owner of the building, and (for a factory, travel agent, tour operator, commission agent or grocer) a bank guarantee. Import and export applications must be submitted at the Ministry of Trade and Industry. Other licenses must be submitted at the local district commissioner’s office.

All foreign companies need a license to do business in Suriname, as well as do most other business people, from accountants to goldsmiths to hotels to bakers to shoe makers to travel agents and so on.

Registration
All businesses except public enterprises and agriculture companies that do not have the form of a limited liability company and societies and foundations that belong to minors must be registered at the Chamber of Commerce and Industry (KKF). To register, applicants must submit: a passport photo of the founders/board members/manager and director, their birth certificates, Articles of Association, and list of members (if applicable). To set up a branch office, a letter of appointment is also necessary. An annual registration fee is assessed based on capital investment. Any changes in the corporation’s address, functions, or management must be reported to the Chamber of Commerce and Industry (KKF).

Partnerships
The Chamber of Commerce and Industry (KKF) can assist manufacturers in finding joint venture partners or financiers, performing feasibility studies and market research and analysis.

Four kinds of partnerships are recognized under Surinamese law:

• professional partnerships (maatschap) – mainly used in accounting, law, and medicine. Each partner contributes to the partnership, but remains solely responsible for debts due to misfeasance, unless one partner is given power of attorney or all partners stood to gain from those actions.
• general partnerships (vennootschap onder firma) – joint liability. Each individual contributes and each is liable for debts. If there is one general partner, his bankruptcy entails bankruptcy of the partnership.
• limited partnerships (commanditaire vennootschap) – one or more general partners and one or more limited partners. The limited partners are only liable to the extent they contributed to the assets and participated in management, while the general partners are fully liable, although individual bankruptcies (if there is more than one general partner) do not entail the bankruptcy of the partnership.
• partnerships limited by shares (commanditaire vennootschap op aandelen) – partnership represented by (usually fully transferable) shares. Partners may be general or limited according to the deed.

Professional, general, and limited partnerships are governed by the Civil Code and not considered separate legal entities. Partnerships limited by shares are governed by the Commercial Code of Suriname and are considered separate entities for tax purposes.

Choice of Business Entity/Structure
Suriname recognizes one-man businesses, open partnerships, limited partnerships, foundations, limited liability companies, cooperative associations, and branch offices.

A joint venture with a Surinamer is usually the easiest way for foreigners to do business in Suriname. A local business partner can help maneuver through some of the complicated trade and investment rules (especially if the investor does not speak Dutch).

In general, foreign investors and exporters are expected to maintain a higher standard of good business practices than Surinamese firms do. While Surinamese companies might get away with bending the rules, foreign companies are generally held to the letter of the law and discovered infractions are widely publicized. Certain segments of Surinamese society retain a nationalistic suspicion of foreign investors.

The N.V.
The public limited liability company (Naamloze Vennootschap or N.V.) is the only form of stock corporation recognized by Surinamese law and the most common form of business. A NV works like a US small corporation with the shares usually in the hands of a few shareholders. Each incorporator must participate in the capital accumulation, at least 20% of which must be subscribed on incorporation.

All NVs start as I.O.s (in oprichting--translated as being set up). It takes at least 3-4 years to change over to be an N.V. and requires the approval of the President of Suriname One disadvantage of companies starting as an I.O. is that the individuals setting up the business are, during the time they are an I.O., legally responsible until the N.V. is set up and can be taken to court.

The deed of incorporation, which must be written in Dutch, must state the number and value of shares. Before the corporation begins its activities, at least 10% of each share must be paid and the President must approve the deed of incorporation, a process which usually involves an investigation by the Ministry of Justice, the Ministry of the Interior, the Chamber of Commerce, and the Inspector of Direct Taxes.

Reductions in capital are subject to public inspection and must be filed with the Commercial Register and announced in the Official Gazette. Shareholders have a right to object to reductions in the company’s capital up to 2 months after it is publicized.

Regulations on voting, stock transfers and meetings should be described in the deed of incorporation. At least one general meeting of shareholders must be held annually. Only shareholders can have voting rights and at least 20% of the capital must be represented by voting members.

A general meeting of shareholders may dismiss, suspend, or appoint managing directors and supervisory directors.

Directors can be held liable for improper actions.

Balance sheets and a profit and loss account must be submitted annually to the shareholders for approval along with criteria by which assets had been valued.

A group of shareholders holding at least 20% of the stock may request an auditor from the district court to investigate the company’s financial affairs.

A corporation may be dissolved by a general meeting of shareholders, on the expiration of its term (if specified in its articles of incorporation, although usually, a corporation’s term is infinite), or after a declaration of bankruptcy.

A declaration of bankruptcy made by a general meeting of shareholders must be announced in the Official Gazette and filed with the Chamber of Commerce and Industry (KKF). After dissolution, a corporation can only wind up its business.

The managing director is responsible for paying the corporation’s creditors unless another liquidator is appointed by the declaration of bankruptcy. No redress for wages of former employees is possible after dissolution. Any assets remaining after debts are paid can be distributed to shareholders 2 months after a plan is published in the Official Gazette. Any interested party may oppose the plan and suspend distribution during this time period.

Within one month of the final distribution, an account of the liquidation must be published at the Chamber of Commerce and Industry (KKF) and at another location. Notice of the final account’s publication must be published in the Official Gazette.

If within three months of the announcement in the Official Gazette, no suits are brought against the liquidator, the dissolution is considered complete.

E-mail
amchamsuriname@sr.net