When you’re expanding your business into Timor-Leste, having the right resources and experts on your side can be critical to your success. If you’re looking for Timor-Leste subsidiary outsourcing options, Globalization Partners can take responsibility as your business entity in the country and provide an easier route to expansion.
Requirements for Setting Up a Timor-Leste Subsidiary
If you want to establish a business in Timor-Leste as an international company, you must establish either a subsidiary or a permanent representative in the country to do business if you are a nonnational. The representative may have Timorese citizenship or be a non-national resident of the country.
To set up a subsidiary in Timor-Leste, you’ll need to meet several basic requirements set forth by Law No.4/2004 on Commercial Companies.
You will need to register your subsidiary with the Ministry of Commerce, Industry, and Environment and obtain a license to do business. To begin, you must establish your business as a Private Limited Liability Company. Typically, the registration will take around two weeks. You’ll need about USD 115 to acquire the license.
How to Set Up a Subsidiary in Timor-Leste
You’ll need to follow the process laid out by the governing regulations to begin doing business in the country. To start, you should deposit minimum capital at a bank. Then, you must register your business and apply for several certification and licenses, including a:
- Registration certificate
- Business license
- Tax identification number
In Timor-Leste, the registration process is streamlined with the SERVE (Service for Registration and Verification of Entrepreneurs, or Serviço de Registo e Verificação Empresarial) platform. By law, your application should be reviewed within five business days, but in practice, it may take longer if there is a need for questions or clarification on any aspects of your applications.
You should submit these documents on the single-service SERVE platform:
- Identification of the corporate bodies
- Memorandum of Association
- Letters of acceptance for each of the corporate body members
- Shareholders’ taxpayer identification numbers (TINs)
- Shareholders’ IDs and proof of marital property if applicable
- Map of your company’s registered office locations
- Documents certifying capital deposit by the company
- Certified copies of past authorizations for doing business if applicable
If your shareholders do not have TINs, SERVE will assign them numbers.
After you’ve received a TIN, you are responsible for confirming your registration with the Ministry of Finance. You may want to obtain a company stamp from a private seal maker, as you will need one to engage with government agencies in the future. Your final step in the setup process is to register your company and employees for Social Security as required by law.
Timor-Leste Subsidiary Laws
According to labor regulations, your business requires a Memorandum of Association to incorporate. The Memorandum may stipulate one or many shareholders who have liability for the company or establish subsidiary liability. A private company can have a maximum of 30 shareholders.
Only Timorese nationals are provided the right to own private land. However, international entities may have long-term leases of up to 50 years.
Benefits of a Timor-Leste Subsidiary
Once you’ve navigated setting up your company’s subsidiary, you can gain several advantages for your business. Some of the primary benefits include:
- Minimal liability: When you establish a subsidiary, some types of entities can limit your company’s liability and help protect your brand.
- Business expansion: A subsidiary allows you to access new markets on a localized level. Your company can easily engage with the local economy and top talent in the region.
Even so, establishing a subsidiary takes a considerable amount of time and money. The process isn’t possible for every company, especially those with limited resources.
At Globalization Partners, we can take on your liability as your Employer of Record. We’ll hire your employees through our entity so you don’t have to set up your own. You’ll get the advantages of a subsidiary as well as streamlined payroll processing and a wide range of additional benefits.
Expand to Timor-Leste With Globalization Partners
Contact us today to learn how we can meet your outsourcing needs with trusted services in Timor-Leste.