Foreigners may hold 100% of Tunisian companies, however, some activities will require that a foreign investor obtain a special authorisation from the Tunisian Investment Council to own more than 49% of the company's capital. A separate authorisation will also be required to transfer more than 10% of voting shares of the company.

The Tunisian law provides for incorporation of entities of various organizational and legal forms, including those which may be attractive for a potential foreign investor, such as:

* Joint-Stock Company
* Private limited liability company
* International Trading company

Joint-Stock Company

A joint-stock company†is established in Tunisia to carry out investment activities and is characterised as follows:

* minimum number of shareholders (physical and legal persons, residents and non-residents of Tunisia) is 7; their maximum number is not limited;
* each shareís nominal value may not be less than TD 5 (US$1 is approximately TD 1.3);
* both registered and bearer shares may be issued;
* company is managed by the Board of Directors (to be composed of no less than three and no more than twelve members);
* the Board of Directors appoints the chairman and general manager;
* foreign citizens may be directors without restrictions but in accordance with the labour law, Tunisian citizens are preferred in appointing officials.

Private limited liability company

Private limited liability company is established in Tunisia to carry out small projects and run a family business, and is characterised as follows:

* minimum number of shareholders (physical and legal persons, residents and non-residents of Tunisia) is 2;
* registered shares issue is authorised, and bearer shares may be issued only if authorised by the Ministry of Finance of Tunisia;
* one director may manage the company and foreign citizens may be directors without restrictions.

International Trading Company

International trading company†is established as a private limited liability company for carrying out export operations, and is characterised in Tunisia as follows:

* at least 66% of the capital must be paid in convertible foreign currency;
* export activity is required to generate at least 80% in the company's turnover.

Foreign exchange control is regulated by the Foreign Trade and Currency Code of Tunisia and enables foreign investors to repatriate capital and receive dividends in foreign currency. The Tunisian dinar is freely convertible in all legitimate trade and investment transactions, however, foreign currency transfers to and from Tunisia require the Tunisian Central Bankís approval.

All Tunisian businesses are required to keep accounts and file periodic financial and other statements.

Only profits received from sources in Tunisia are subject to taxation at a rate of 35% in Tunisia. Export profits are subject to deduction from the tax base.

Physical persons who generate income from sources in Tunisia pay income tax at the rates ranging from 15 to 35%. At the same time, income up to TD 1'500 is not subject to taxation.

Foreign citizens's dividends, profit from shares sale and capital gains are exempted from taxation in Tunisia.

Land registration tax in Tunisia is imposed at a rate of 5% of the real estate value.

Tunisia Double Taxation Agreements

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