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Company incorporation - Andorra

Basic characteristics Societat Limitada:

Share capital: The Societat Limitada has a share capital of €6.010.
Shareholders: A minimum of two shareholders are required and at least one shareholder must be of Andorran nationality owning a minimum of 67% of the company’s share capital. Non-Andorrans and non-residents can only own 33% of the share capital. Details of shareholders are kept at the local registry. An offshore company can be used to own 33% of the share capital. It is possible to arrange for an Andorran citizen to act in a nominee capacity for the ultimate owner of the company.
Company Officials: A minimum of two officers is required at all times. A President must be appointed who must be an individual of Andorran nationality as well as the second officer who acts as Company Secretary. Details of officers must be available for public inspection at the registered office address.
Share Capital: The share capital must be fully paid up before incorporation. The amount in question must be deposited with an Andorran bank in a designated company incorporation type account. The bank must then release a special certificate, addressed to the designated notary, responsible for concluding incorporation formalities.
Annual Accounting: Accounting information and books must be kept at the company’s registered office, but these need not be audited or filed with local authorities.
Tax: There are no corporate taxes whatsoever.
Timeframe: An Andorran company (Societat Limitada) may be incorporated within 30 to 45 days.
Corporate names: Names must end with S.L. It is advisable that the name selected is at least Catalan sounding. Τhe first step in order to incorporate a limited company in Andorra is to reserve the company’s name at the Andorran Government, where the authorities check that the name is correct with compliance to the relative articles on company’s names and establishment signs of Commercial Law, dated 20th June 1996.

Legal aspects and incorporation procedure:

The incorporation of companies in the Principality of Andorra is regulated by the Regulation of companies dated 19th May 1983. This Regulation foresees a limitation in the share participation that foreign capital can hold in an Andorran company. The share participation which can be held by foreign capital is one third (1/3) of the total capital of the Andorran company. It can be considered as Andorran Capital when it is owned by Andorran, physical persons or legal entities, or by foreign physical persons who can prove that they have been permanently residing in the Principality of Andorra for at least 20 years. The incorporation of a limited company requires two shareholders at a minimum and a maximum of ten. The share capital is divided into participations and the minimum capital required is €3,005. The capital may not exceed €30,050. Respectively the incorporation of an S.A. company requires no less than three shareholders, the share capital is divided into registered shares and the minimum capital required is €30,050.
The capital both upon incorporation as well as the capital contributed in successive capital increase must be subscribed in total and paid-up to the amount of €30.050,61 except when the capital upon incorporation or at a successive capital increase exceeds the mentioned amount. In this event, it should be subscribed in total but the capital, which could be paid-up, exceeds €30,000 or 25% of the total share capital. Likewise, no shareholder may transfer his participations or shares to a foreign person without the previous authorization issued by the Andorran Government, who must verify that, the foreign participation will not be more than the third part of the total share capital. The representative positions in the company, such as President, Managing Director, Sole Administrator or any other position, which could suppose a general attribution of the company’s representation, should relapse on Andorran citizens or foreign persons who can prove that they have been permanently residing in the Principality of Andorra for at least 20 years. The Companies Regulation allows that the functions or positions, which suppose only administration or technical acts without general delegation of decision powers, can relapse on foreign people. It will also be possible to attribute to foreign people (without a continuous residence of 20 years) powers of attorney in order to delegate power, provided that these powers are expressly granted with special purposes and for a particular operation, according to what has been previously agreed by the General Meeting of the company.
Τhe first step in order to incorporate a limited company in Andorra is to reserve the company’s name at the Andorran Government. Once the company’s name is reserved, we can prepare the application of incorporation authorization, and two copies of the Memorandum and Articles of Association of the company, which must be signed by the shareholders. These documents must be submitted to the Trading Department of the Andorran Government, who after having checked and reviewed all the documentation will then issue a resolution authorizing to incorporate the company (it can take up to four weeks).
In the incorporation application of any company must include the shareholders’ personal details: name, surnames, date and place of birth, nationality, passport or identity card number. The registered office of the company, the business scope of the company under incorporation, the capital distribution, the representative positions and the termination of the company must also be clearly stated. Afterwards, all shareholders must sign the incorporation deed before a Public Notary. Before the signature of the incorporation deed, it is necessary to subscribe the capital and submit to the Notary a bank Certificate producing evidence that the Capital has been paid-up. The approximate term to formalize the incorporation deed is one or two weeks' time.
The Notary will then submit the Incorporation deed to the Department of Economy of the Andorran Government in order to proceed to the registration of the company in the Companies Register and once the company is registered, the Government will issue the Certificate of Registration of the company.

Bank Accounts

Features of the Andorran bank system

  • - A minimum deposit is needed, but this is low, compared to Switzerland
  • - Secrecy is very important - Andorra banks often offer a mailbox, so that mail can be collected confidentially
  • - There are no restrictions on transferring money into and out of the country
  • - Privacy is enshrined in the 1993 constitution
  • - Any bank official breaching privacy, is liable to 7 years' imprisonment, due to article 226 of the Andorran criminal code
  • - There is a withholding tax of 15% on interest paid to citizens of EU countries
  • - The banking sector is highly regulated, so as to maintain the high reputation of the state

In general, no translations are needed for any documents produced in Catalan, English, French or Spanish. Andorrans working in banks are likely to have a good knowledge of all these languages. 50% of Andorrans go to French schools, and 50% go to schools using Catalan and Spanish as the first languages.

Information required when opening a bank account in Andorra

  • - Personal details
  • - Full name (as appears on identity documents)
  • - Date and place of birth
  • - Nationality
  • - Fiscal residence
  • - Passport or National Identity card number
  • - Phone and email
  • - Client's professional details
  • - Profession
  • - Details of company, with national identity or fiscal number
  • - Activity of the company:
  • - Registered office
  • - Phone, fax, email and website
  • - Reference details
  • - Bank and professional references
  • - Proof of fiscal residency: copy of a credit card statement, copy of utility bills
  • - Declaration of solvency
  • - Declaration of source of funds
  • - Copy of passport: certified and apostilled