Foreign investors should definitely appoint legal representatives for the company formation process in Nicaragua; these will handle all the registration formalities on their behalf. Our consultants, who offer professional services for company incorporation in Nicaragua, can represent you in the set-up of any type of legal entity that can be registered here.
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Company types in Nicaragua
As a foreign investor, it is allowed to open a company in Nicaragua by selecting any of the legal entities regulated under the local commercial law. In general, foreign businessmen opt to register limited companies or branch offices as they provide a set of advantages in terms of ownership, management, liability, taxation, etc.
The decision should be based on the investment plans businessmen have and our team of specialists may provide an in-depth presentation on the main advantages, obligations or pitfalls of each of these structures, in order to make a reliable risk assessment when investing here under a specific business form.
Below, you can observe some of the matters that should be taken into account when opening a local business:
- the process of company formation in Nicaragua can take up to 4 weeks (the longest incorporation formalities apply in the case of those who open a branch office);
- businessmen can choose from 2 types of limited companies, namely the limited liability company and the public company (also known as corporation);
- for the registration of a corporation, at least 2 shareholders must associate in the business (they can have any nationality);
- limited companies must also have at least 1 director (those who will opt for a branch office must appoint 1 legal representative, who has to be a resident of Nicaragua).
Observations on private companies in Nicaragua
Private companies in Nicaragua have similar traits as the ones of private companies that can be incorporated in other countries. Similarities refer to the ownership rights, liability, capital, incorporation process, trade name, statutory documents, etc.
For instance, foreign businessmen who set up a company in Nicaragua can benefit from full ownership rights. In limited companies, investors have limited liability for the debts incurred by their businesses, which is limited to their capital contributions, given that the legal entities that they have set up have separate legal personality.
Local companies gain their legal recognition after drawing up and signing the statutory documents (represented by the articles of incorporation) through the execution of a public deed. The document is signed by a public notary, after which it is filed with the official institutions of the state (the Mercantile Registry).
Are investors required to comply with special rules ?
Yes, when they open a company in Nicaragua they need to obtain special certifications granted for foreign investments. Thus, they have to apply for a Unique Foreign Investment Registration Certificate issued by the Ministry of Development, Industry and Trade, in accordance with the rules of Law No. 1240 (Foreign Investment Law).
We invite foreign businessmen to contact our team of specialists in company formation in Nicaragua for advice on the issuance of this document, as well as for legal assistance during the registration of a legal entity.