• For foreign companies that want to begin doing business in Bolivia, they can do it now through the creation of a branch office.
• In general terms, a branch office is an extension of the headquarters of the company. In other words, the branch office is part of a parent company and cannot be considered as an individual or separate legal person. In this way, the legal problems that can take place at the branch office will directly affect the headquarters. A branch office would have to send all its profits to the headquarters. As a consequence, this kind of business will have to pay not only the tax over utilities, but also the tax over exterior beneficiary, equal to the 12.5%
• The basic principle for the creation of a branch office is simple.
-A company constituted in a foreign country that develops its principal business in Bolivia through a branch office, is considered a local office for the effects of its performance, control, supervision and liquidation of its business; and in the case of the cancellation of its legal personhood.
• It is important to clarify that the branch office representative must be a Bolivian citizen. However, if this person is a foreigner, he or she must acquire a Bolivian Identification for Foreign Aliens. This document is acquired by having a temporary residence in Bolivia.
• As for the procedure and costs of the branch office, we have to mention:
Bolivia is not part of The Hague Apostille, for this reason, the documents that prove the legal existence of the headquarters must be legalized in the country of origin as well as in Bolivia.
– For this reason the procedures needed to constitute a branch office may take time, and are more expensive than those to constitute a domestic Bolivian corporation or limited liability company as a separate entity from the parent company. This is due to the legalities in both countries that must be satisfied for the establishment of the branch office.
• The time to open a branch office is typically between 2 and 4 weeks once all required documentation is submitted.
• For more information, contacts us at: email@example.com or call us on Skype.