Dominican Republic Company Formation
|Company Type||Time to Incorporate||Cost|
|SRL / EIRL||3 weeks||£2260|
Company Law (“Ley de Sociedades”), governs company formation in the Dominican Republic. The law imposes few capitalization requirements, but unlike some countries, Dominican companies are subjected to the same tax treatment regardless of structure.
An individual member’s liability is limited to no more than the amount of that member’s contribution to the company. In other words, if a company fails, a member stands to lose only that member’s investment. None of the members, individually or collectively, are liable for the debt obligations of the company.
Sociedad de Responsabilidad Limitada S.R.L. – The Limited Liability Company
for small to medium-sized businesses and large, family-owned businesses.
Structure: Minimum of two shareholders, maximum of 50; minimum capital investment of 100,000 Dominican pesos approx. US$2,700. Management is by one or more individuals or a board of individuals as established in the by-laws.
Shares: No stock is issued. Transfer of shares is essentially restricted, and requires 50 to 75% of the votes of the shareholders for approval.
Empresa Individual de Responsabilidad Limitada – E.I.R.L. – The Individually Owned Company with Limited Liability
Good for individually owned businesses.
Maximum of one shareholder who must be the owner and an individual, not a company; no minimum capital investment is required; management is by the owner, or an owner-appointed manager.
Company Formation Process
A shareholder or Director/Manager need not be a Dominican citizen or resident in Dominica, as a member, you will be required to provide your full name, nationality, occupation, marital status, and address and a copy of your passport.
Register the company name
If time is important and the company name is not immediately critical, you have some options. Ready Made companies are available for purchase at a premium price. However, if cost is a factor, you can still expedite the registration process by selecting a numbered company (ie: 12345 S.R.L.), and changing the name later. This two-step process will incur extra costs, but will expedite the registration process with the advantage that you will establish a company more quickly.
Pay the organization tax
This tax amounts to 1% of the authorised capital for S.A. and S.A.S. structures, and paid-in capital for S.R.L. and E.I.R.L. structures.
Record the company documents with the Business Registry “Registro Mercantil” and the moment the company documents are recorded at the Business Registry, the company is deemed to legally exist.
Register the company with the Bureau of Internal Taxes “Dirección General de Impuestos Internos” – DGII”
The newly formed company and each individual member must obtain a tax number by registering with the DGII. Company tax number “número de registro nacional de contribuyentes”
Every Dominican company must comply with the following reporting formalities:
1. Annually, hold a general members’ meeting to review the company’s operation for the previous year. Minutes of the meeting must be recorded with the Business Registry. This entails a cost of US$500.
2. Every two years, renew the company registration with the Business Register. This entails a cost of US$250.