Company registration in Lebanon in one day, with a bank account.

A Limited Liability Company, also known as an LLC, is governed by Decree-Law No. 35 of August 5, 1967 and is commonly referred to in Lebanon as an S.A.R.L (the French equivalent of L.L.C).

An S.A.R.L can be founded by a single partner and can have up to twenty partners. It can be fully owned by foreigners. The minimum capital is set at five million Lebanese Pounds; contributions may be in kind or in cash.

Since the company is of limited liability, the partners are only liable to the amount of their contribution or parts in the company. Partners in an LLC are not considered to be merchants, and hence are not subject to the provisions applicable to merchants, including the provisions of the Lebanese Code of Commerce.

Management of an LLC is given to one or more managers. The manager can be a partner. The company’s denomination is always followed by the abbreviation “LLC”.

Limited Liability Companies are subject to a 17% tax on corporate profit. There are no restrictions on foreign participation in limited liability companies, except for certain sectors and activities. The company must appoint a lawyer with yearly retainer fees.

A Lebanese Joint Stock Company, known as a JSC, must be constituted by a minimum of three shareholders and can be fully owned by foreigners. The liability of the shareholders is limited to their shares in the company.

The minimum capital for a JSC is LBP 30,000,000, which can be contributed in cash and/or in kind. The company may call for public subscription and may issue negotiable financial instruments or bonds.

Management is entrusted to the board of directors, which elects a president from among its members. Board directors are elected by the general assembly of shareholders. The board has a minimum of 3 and a maximum of 12 members, and the majority of board members should be of Lebanese nationality.

There are no restrictions on foreign participation in joint stock companies, except for specific sectors and activities — mainly the public sector, commercial representation, and real estate under certain conditions.

The company must appoint an auditor, and its name should always be followed by the abbreviation S.A.L. A lawyer has to be appointed with yearly fees, as per Lebanese law. JSCs are subject to a 17% tax on corporate profit.

Offshore companies are a variant of the Joint Stock Company. All shareholders and the board of directors can be foreigners. Law 85/2018 allowed the incorporation of an offshore company by a single shareholder.

The capital requirement is the same as for joint stock companies, but it can be denominated in foreign currency. The offshore company enjoys tax advantages and is subject to a flat yearly tax of around USD 600, regardless of its turnover or profits.

According to Article 7 of Law 19/2008, salaries and benefits paid to employees of offshore companies working abroad are exempted from payroll tax. The companies concerned are required to declare the salaries of all their employees, including those working abroad.

The chairman may be a non-Lebanese resident abroad and may operate without a permit. The company is formed and registered both in the Commercial Register and in a special register for offshore companies.

Offshore companies are formed and registered in Lebanon, but operate only in the Lebanese free zone and/or outside Lebanese territory. They can, however, have their headquarters in Lebanon and hold accounts with Lebanese banks.

Their object is the following

• Negotiation and conclusion of agreements concerning goods and products located outside Lebanese territory or in the Lebanese Free Zone.
• Offering studies and consultations for the benefit of foreign institutions.
• Using free zone facilities to store imported goods for re-exportation.
• Buying or renting real estate in Lebanon to the extent necessary for the operation of the offshore company.

Activities added by the latest amendment

• The administration of companies and institutions outside Lebanon, including the export of services and software of any kind to these institutions.
• Three-sided or multi-sided trade operations — negotiating and drafting contracts, shipping goods and reissuing bills for transactions outside Lebanon or in the Lebanese free zone — including storing goods in the free zone for export.
• Activities related to maritime shipping.
• Acquiring shares in foreign corporations, companies or institutions, and lending to institutions in which the offshore company holds more than 20% of the capital.
• Acquiring or benefiting from rights related to agencies or commercial representation of foreign or non-resident companies or institutions.
• Opening branches and representative offices abroad.
• Construction, investment and administration in economic projects, except those prohibited by law.
• Opening accounts and using financial services to finance its activities, whether from local or non-resident institutions.
• Leasing or acquiring offices or real estate in Lebanon in relation to the activities of the offshore company.

The Holding Company is another variant of the Lebanese Joint Stock Company and benefits from a very special tax treatment. The minimum number of partners and the capital requirement are the same as for joint stock companies, and the capital can be held in foreign currency.

The holding company can be fully owned and directed by foreigners, and the non-Lebanese chairman of a holding company is exempted from work permit requirements.

Its object is strictly limited to

• Buying and subscribing to shares in Lebanese or foreign joint stock or limited liability companies.
• Managing those companies.
• Lending money to companies in which it holds a minimum of 20% of the shares, and/or guaranteeing such companies towards third parties. For this purpose the holding company may borrow from banks and issue bonds, provided the total value of issued bonds does not exceed five times its capital and reserves.
• Holding and leasing patents, concessions and trademarks.
• Acquiring movable or real estate assets necessary for the holding’s operations.

The Lebanese holding company enjoys various important tax advantages: it is exempted from income tax on its profits and on the distribution of dividends. An auditor needs to be appointed and, as for all Lebanese companies, a lawyer has to be retained with yearly fees.

A foreign company wanting to do business in Lebanon can establish a branch, which should have the same object as the mother company. The branch must first be registered with the Ministry of Economy and Trade, followed by a second registration at the Trade Registry. A director for the local branch needs to be appointed, as well as a lawyer with yearly fees.

The foreign company may instead opt to establish a Representative Office in Lebanon. However, the representative office’s activity is restricted to the promotion of the head office’s services and products; a representative office may not engage in trade activities of any kind in Lebanon.

To set up a branch or representative office, the foreign company’s Board of Directors must issue a proxy / power of attorney in favour of a Lebanese lawyer, granting the authority to register the company in Lebanon, to represent it, to sign documents and to take all necessary measures on its behalf.

Documents needed

1. The foreign company’s by-laws and articles of incorporation (if applicable).
2. The foreign company’s Certificate of Incorporation.
3. The corporate resolution of the foreign company, resolving to: (i) set up the branch in Lebanon, (ii) appoint a specific person as manager of the branch and determine his powers, and (iii) appoint a Lebanese legal counsel / attorney to the branch.
4. A copy of the manager’s identification papers or passport, and a copy of the lawyer’s bar association card (where applicable).
5. Once the above original and legalised documents are sent to Beirut, they must be certified at the Ministry of Foreign Affairs and submitted for translation into Arabic by a competent translator.