Paraguay: A guide to starting a business
Innovation. A word we associate with a globalising world in which staying ahead of the trend curve is the key to success, whether it is finding a gap in the market, or developing new technology, the need to innovate creates a thriving environment for competition between new businesses. However, there are many ways to position your business in an advantageous position, and one of these factors is strategically choosing your headquarters. This is where Paraguay comes into the picture, a landlocked nation situated in the heart of Latin America, a region representing the embodiment of innovation on a global stage, where economic development is paving the way for opportunity for foreign businesses.
The notion of competition and market gaps is dynamic as the global community undergoes rapid and unforeseen changes. One example of this we have all experienced in the last year is the global Coronavirus health crisis, where industry and services have seen declines in previously essential sectors, while others have seen sudden rises in demand. When considering the idea of establishing a new business, the past year places you in an interesting position, the likes of which was unimaginable before the pandemic, you are able to factor in contingency plans and desires for remote working, limiting the potential damage to your business in the future should this happen again. With this in mind, let us explore the role Paraguay has to play in your plans to start a new business, specifically, how to establish a company within its borders.
First of all, these are the different options you have with regards to business establishment:
1. Paraguay LLC (SRL)
· Two shareholders minimum and one director (they are either temporary or permanent residents of Paraguay)
· No minimum capital
· 10-12 weeks processing time of application
· Corporate contract from Public Registry required
2. Paraguay Public Limited Company (SA)
· Two shareholders minimum and one director (One needs to be a resident of Paraguay)
· No minimum capital requirements unless export related in which case the minimum is US$10,000
· Court authorisation required from Public Records
· Popular with foreign investors setting up big businesses
The two options present a variety that, should you be wishing to start a new company, affords you an opportunity to create a business with a suitable framework for your desired methods of operation. If we put the above information to the side for just a moment and look at the actual formation process, you will see that establishing a new business in Paraguay is a process that is, when compared with other nations, relatively simple.
1. Search for the company name you have thought up to make sure that it is available. This step is crucial in order to avoid any disputes or other related issues in the future
2. Get a lawyer to sign the company documents you have drafted. Formalisation is key, ensuring your documents are legalised and signed keeps everything above board and avoids delays later down the timeline of application
3. Get the company deeds notarised
4. Single Access Window Agency (SAWE): submit your application using the papers from the previous steps and await approval
5. Treasury Attorney Office: bylaws and company registration papers must be submitted here
6. Ministry of Finance: Apply for tax registration and receive registry number
7. As with other countries, the last step is the publication in a public newspaper/magazine of the intentions of your company in order to allow time for objections to be made (should there be any)
Paraguay is evidently a good option for those of you looking to start a new business overseas, yet the benefits extend beyond the process itself. Below we will share some more advantages to choosing Paraguay as a nation for business.
1. Emerging market
2. Positive location
3. Strong workforce