Growing your company into West Africa can be an exciting opportunity. You’ll get to form new business relationships and reach new customers. Despite all the benefits, however, learning how to set up Burkina Faso subsidiary is a complex process that can take several months to complete. Plus, that’s on top of running your parent company, hiring new employees, and learning a whole new set of labor laws.
As a global Employer of Record (EOR), G-P understands the challenges of global expansion. We mitigate the associated risks and help companies expand faster without the stress and worry of compliance. When you work with us, you can bypass entity setup and start working in a fraction of the time.
How to set up a Burkina Faso subsidiary
If you decide to take the traditional expansion route, setting up a Burkina Faso subsidiary involves several steps, including choosing the location for your office space. Various cities and regions can operate like states, using their own laws that impact incorporation. Always research a potential location before incorporating to see if it’s easy or difficult to set up a subsidiary, or work with a consultant who can recommend the best locations.
Companies have a variety of options when it comes to setting up a Burkina Faso subsidiary. The country allows entities such as a limited liability company (LLC), branch office, or public limited company. Each structure has its own laws, regulations, and restrictions on operations, which will impact how you run your business.
Companies planning to operate in the country long-term often choose to set up an LLC. With an LLC, you can offer a wide range of products and services, enjoy tax-friendly laws, and protect your parent company from liability. The steps of the Burkina Faso subsidiary setup process include:
- Opening a Burkina Faso bank account.
- Depositing your minimum share capital in the bank account.
- Providing proof of your capital deposit.
- Registering with the Centres de Formalités des Enterprises (CEFOREs).
- Applying for any necessary licensing.
- Obtaining a business license through the Ministry of Commerce.
- Registering for all accounting and tax requirements.
Burkina Faso subsidiary laws
Burkina Faso’s subsidiary laws depend on the type of entity you choose for incorporation. For example, LLCs have separate rules compared to branch offices and public limited companies. You need at least 1 director and 1 shareholder, who can be of any nationality, to set up a Burkina Faso subsidiary as an LLC.
LLC tax obligations include appointing an auditor to submit annual audited financial statements. You also need to keep your financial records in French at your office according to OHADA laws. If you’re not fluent in French, you’ll need to hire a team to keep these statements or work with a third party.
Benefits of setting up a Burkina Faso subsidiary
Although it can take a while to set up your Burkina Faso subsidiary, the biggest benefit will be that you can operate like a local company. With an LLC, the parent company has limited liability from the subsidiary, and the subsidiary has the opportunity to work as a separate entity.
Other important considerations
Companies looking to expand to Burkina Faso through establishing a subsidiary need the time and money to complete the process. You may face fees throughout the incorporation process, and it can help to work with your accounting department to set a budget. You should also prepare to spend time traveling back and forth to Burkina Faso or appoint another company executive to handle travel.
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