Company Formation in Madagascar

Madagascar is a good destination to set-up your company to cater to the fast growing African market with a large population. YourGlobalPro can assist in Madagascar for Company Formation, Secretarial Compliance, Tax Registration, VAT Reclaim, Document Retrieval and Trademark Registration.

About the Country

Republic of Madagascar (Madagascar) is an island country in the Indian Ocean near the coast of Southeast Africa. It is the fourth largest island in the world. After the breaking of the supercontinent Gondwana, Madagascar split from the Indian peninsula around 88 million years ago, allowing native plants and animals to evolve in relative isolation.  The country’s ecology is composed of a mix of plants and animals, some unique to the island only. The below content will explain you in detail about the requirements for the company formation in Madagascar, know more about the process of trademark registration in Madagascar and understand the Madagascar Legal Compliance requirements.


Doing Business Introduction

Madagascar economy is sustained by its agricultural, growing tourism, textile, and mining industry.

The agriculture industry holds a large part of the country’s economy such that it employs 82% of the total workforce.  Madagascar provides the second largest vanilla harvest in the world. As per Doing business report of The World Bank –Madagascar ranks 167 for 2017 survey in terms of ease of doing business.

YourGlobalPro professionals can assist its client with any type of company formation in Madagascar, trademark registration in Madagascar and other recurring services for your business in Madagascar.

Incorporation - Types of Business Entities

Before starting the business, the first decisions to make is to determine what form of business entity to establish. There are several types of entities that can be incorporated in Madagascar are as mentioned below:

·       Limited Liability Company (Societe a Responsabilite Limitee – SARL)

·       Public Limited Company (Societe Anonyme – SA)

·       Free-zone Company (EPZ Company)

·       Branch Offices (Succursale)

·       Representative Office (Bureau de Representation)

Time Frame for Incorporation of Company in Madagascar varies from depending on the type of entity selected and each business type has its own advantages and disadvantages. YourGlobalPro professionals estimate the time required for the process of Company formation in Madagascar to be completed is 11-14 working days.

Benefits of Registration of a Company

Below are the advantages of company formation in Madagascar:

·       The cost of business operations is low.

·       Lesser import costs compared to other Sub-Saharan countries

·       Benefits provided by the industrial free zone include the following:

·       15 years’ tax exemption

·       VAT exemption on customs duties and import of raw materials

·       Zero rated VAT on exports

·       Free access to foreign currency deposits in the company’s foreign currency bank account

·       Minimal requirements for incorporation making it easier for foreign nationals to invest

Tax Registration and Filing

Below are some crucial points in relation to taxation rates in Madagascar:

Corporate Income Tax Rate 20%
Capital Gains Tax 20%
Branch Profits Tax Rate 20%
Dividends 0%
Interest 20%
Royalties 10%
Other non-salary payments Residents - 5%
Non-Residents - 10%
Value Added Tax 20%
Fiscal Year 1 January to 31 December
Filing Corporate Income Tax Return By 15th May of the year following the Tax Year
Advance Tax To pay six instalments of one-sixth by 15th of Feb, April, June, Aug, Oct and Dec

Double Tax Treaty

Double Tax Agreements (DTA) regulates the tax treatment of income or capital gains in situations where the same taxpayer is taxed twice in two countries for the same subject. Madagascar has double tax treaty agreements with France and Mauritius.

Trademark registration

Trademark registration in Madagascar is performed through the Office Malgache De La Propriete Industrielle (OMAPI)-Madagascar. The trademark deposited at OMAPI is protected in Madagascar only after registration. The Trademark Registration in Madagascar is valid 10 years from the date of filing trademark and is renewable for similar periods of 10 years.  It takes approximately 12 months from first filing to registration.

YourGlobalPro professionals are fully equipped to assist you with the process of trademark registration in Madagascar for your business. For assistance or advice in the matter of the trademark registration or intellectual property – please feel free to write or contact us.

Secretarial Compliance

Below are some of the important points in relation to Company Secretarial Compliance in Madagascar:

·       SARLs and SAs must assign a resident representative and must maintain its book of accounts in French.

·       Branches of foreign entities must have a register office in Madagascar.

·       Representative offices and branches of foreign companies must have an appointed representative tasked to receive summon, notices and invitations in behalf of the company.

·       Expenses of representative offices must be met through inward foreign currency remittances.

·       A legal notice of constitution must be published in a French newspaper. Tax ID, statistics ID and Registration number must be published.

·       Employees must be registered with Social Security Fund.

Accounting Services

The existing Madagascar accounting standards are known as The National Accounting Plan (PCG 2005). The plan allows companies to apply the International Financial Reporting Standards (IFRS).  Financial statements are required to be filed with the tax declaration of the companies. In practice, entities in Madagascar prepare 2 sets of financial statements. One that follows the PCG 2005 for tax and local filing purposes and another that follows the IFRS for consolidation process of their respective parent company.

YourGlobalPro professionals assist you with the entire bookkeeping and accounting services for your Madagascar Business Setup as per your business needs including implementation of financial accounting software, accounting records preparation and time to time preparation of budgets, forecasts.

Auditing service

In Madagascar, all types of business entities except representative offices are required to have annual statutory audit. SARLs and SAs are required to provide audited financial statements yearly.

YourGlobalPro professionals provide you auditing services as required by your business in Madagascar.


Opening an account in a bank is quite easy in Madagascar. The documentation requirement differs from Bank to Bank and needs to be compiled for the Bank account opening.

The major banks in Madagascar are Bank of Africa- Madagascar, Banque Malgache De L’Ocean Indien, and BNI Madagascar. All the banks are stable, reliable and offer the same level of services.

YourGlobalPro professionals facilitate all the paper work in relation to banking need and can assist you in an opening bank account for your business plan in Madagascar.

Legal and Compliance

In Madagascar, the responsibility of legal compliance is not a one-time affair, but a continuous process. Below is the various Madagascar legal and compliance requirement to be followed by incorporated entities:

·       Limited liability companies must have at least 1 director and 1 shareholder of any nationality. The minimum required capital is $1 only.

·       Public limited companies should have at least 1 director and 1 shareholder of any nationality. The minimum required capital is $800.

·       Free zone entities in Madagascar must be approved first by the Economic Development Board of Madagascar before they are incorporated.

·       Free zone entities must export 95% of its production to enjoy free-zone incentives.

·       Representative offices and branches can 100% foreign owned.

·       Representative offices are not allowed to perform income generating activities in Madagascar.

YourGlobalPro professionals can assist you in legal and compliance requirements.

HR and Employment Law and Immigration / VISA

Below are some of the important points in relation to HR & employment law in Madagascar:

·       Fixed term contracts are prohibited for permanent tasks.

·       The maximum length of single fixed term contract including renewals is 2 years.

·       Employers must pay a premium of 30% of hourly pay for overtime work

·       Paid annual leaves regardless of tenure is 24 days.

·       Registration for health insurance of employees is required.

·       Foreigners who want to enter Madagascar must obtain a tourist visa or business visa for a stay of fewer than three months.

·       Foreigners who want to work in Madagascar must obtain a transformable visa, which is valid for one month. The transformable visa must be changed to a long-stay visa for a foreign worker within one month after he or she enters Madagascar.

Country Statistics

Capital Antananarivo
Largest City Antananarivo
Total Area 587,041 Sq. Km.
Population 24,430,325
Density 35.2 / Sq. Km.
Currency Malagsy Ariary
Government Unitary semi-presidential constitutional republic
Official Language Malgsy French
Religion Traditional Beliefs/ Folk: 55%
Others: 5.0%
Government Office Hours Mon-Fri (0830-1800 Hrs)
Business Office Hours Mon-Fri (0830-1700 Hrs)
Banks and Exchange Houses Office Hours Mon-Sat (0800 to 1700 Hrs)

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