Laws
Formation
Trade Name
Share Capital Requirements
Privacy and Confidentiality
Maintenance and Administration
Taxation
Armenia enacted investor friendly incorporation laws which have been
regularly amended. The main act regulating most of the aspects of
corporate formation and activities is the Law on Corporations dating
from 2001. Armenian law provides for fast incorporation, low maintenance
fees and use of corporate form to engage in any legitimate business,
such as investing, trading, and property holding. Unlike foreign natural
persons, corporations are allowed to own interest in land.
Limited Liability
Limited Liability
Armenian corporations enjoy limited liability and are not responsible
for debts of their shareholders. Shareholders, in their turn, are not
responsible for debts of the corporation, and the doctrine of corporate
veil piercing is not applicable in Armenia.
Formation
A corporation is formed by filing a statute (articles of incorporation)
with the State Registry. Armenian law provides for same day company
incorporation and the whole process can take as little as 30 minutes.
Moreover, it is possible to submit all necessary documents online. It is
therefore not necessary for incorporators to come to Armenia as long as
they have a local agent in Armenia or a proper e-signature certificate.
Articles of incorporation must be filed in Armenian but the use of
parallel languages is not restricted. A single shareholder is sufficient
to create a corporation. It is not necessary for a corporation to have
directors but it must have an executive officer who can be the
shareholder himself. Shareholders and the executive officer can be
corporate entities. The corporation must maintain a registered office
(legal address) in Armenia but no local secretaries are required. The
corporation's life can be specified in the articles of incorporation.
Armenia is party to the Apostille convention and incorporation documents
are eligible for an apostille. Registration fees do not depend on the
value of share capital and amount to approximately $45. Armenian law
does not recognize migration of domicile.
Trade Name
Trade names are registered in Armenian but it is lawful to use their
translations into other languages. Corporations are required by law to
use endings stating the limited liability. Trade names shall not contain
words like "bank" or "insurance," unless the corporation has a proper
license. Words "Armenia" or "Armenian" can be used only after a formal
authorization by the Government is granted. It is possible to check the
availability of names online.
Share Capital Requirements
Corporations may issue shares in variety of forms and classifications:
preferential or common, voting or non-voting. Bearer shares and no par
value shares are not authorized. There are no minimum or maximum limits
on the amount of share capital. Share capital can be paid in Armenian
currency or by transferring other non-cash assets. Share register must
be kept and maintained by a licensed registry other than the
corporation.
Privacy and Confidentiality
Nominal shareholders are allowed, and particulars of beneficial or
nominal shareholders and directors are not part of public record.
However, articles of incorporation, information on executive officer,
local address and share capital are available to public.
Maintenance and Administration
A corporation must at least have an executive officer. Company staff,
local directors and secretaries are not required. The executive officer
and directors can be corporate entities. Officers, directors and
employees can be foreign citizens and residents of any country.
Registration fees are paid only once, and no annual fees are payable to
the Registry. Books and records must be maintained but there are no
requirements for filing them with the Registry, except for amendments to
articles of incorporation and changes of executive officers. There are
no requirements for annual audits. Annual meetings can be anywhere in
the world, and shareholder can be represented by proxies.
Taxation
Entities incorporated in Armenia are taxed on their worldwide income,
and the standard corporate tax rate is 20%. Foreign tax credits are
available. Incomes and expenses are recognized on accrual basis. As a
general rule, dividends are exempted from taxation.
Nerses Isajanyan
Attorney'
