Doing Business In.. 2020 Comparisons

Last Updated July 15, 2020

Contributed By Houda Law Firm

Law and Practice


Houda Law Firm was founded in 1977 in Dakar (Senegal) and consists of a 42-person staff, half of which are specialised and highly qualified lawyers and legal advisors working to assist clients – such as private companies, public entities, and individuals – with all of their legal needs in Senegal and WAEMU (West African Economic and Monetary Union) member states. The firm opened a branch in Abidjan, Ivory Coast, which made it the very first foreign law firm from the WAEMU region established in the country. Houda's team works on matters related to company incorporation, investment, employment law, taxation, business litigation and arbitration. The firm is in the process of finalising ISO 9000-2015 certification.

Senegal has a civil law system with laws passed by the National Assembly and applicable in various matters.

The legal system essentially consists of three levels of jurisdiction:

  • the courts of first instance (Tribunal de Grande Instance, Tribunal de Première Instance), with specialised courts such as the Labour Court and the Commercial Court for matters relating to these sectors;
  • the courts of appeal are second level courts, responsible for reviewing cases tried by the courts of first instance if one of the parties is not satisfied with the decision of the courts of first instance; and
  • the Supreme Court, which is the highest court of the Senegalese judiciary, before which complaints may be lodged to assess violations of the law by the lower courts.

Article 9 of Law No 2004-06 of 6 February 2004 on the Investment Code, as amended by Law No 2012-32 of 31 December 2012, establishes the principle of equal treatment by which foreign natural or legal persons shall enjoy the same treatment as Senegalese natural or legal persons, subject to reciprocity and without prejudice to measures that may concern all foreigners or to the more extensive advantages and guarantees that would be provided for in treaties or agreements concluded or that may be concluded between the Republic of Senegal and other states.

Exceptionally, certain sectors provide for requirements in terms of approvals and/or authorisations for certain investments and direct operations before the start of activities, such as in the mining sector, the electricity/renewable energy sector and in the hydrocarbons sector. An investment without approval could have negative consequences vis-à-vis its manager, in terms of administrative, pecuniary or penal sanctions.

Banking, finance and similar activities are subject to special regulations (national and WAEMU community) and are subject to prior approval by the Minister of Finance.

In addition, the public procurement code and the law on partnership contracts guarantee the free participation of foreign investors in competitive bidding procedures, in accordance with the principle of equal treatment and non-discrimination.

The State of Senegal has also increased the number of Special Economic Zones (SEZs) in order to encourage private foreign investment in the country, exemption from national import duties and taxes, a reduction of the corporate tax rate to 15% and a number of other exemptions.

The Investment Code provides incentives for private investment that benefit both foreign and domestic investors, particularly in the areas of taxation and customs in various sectors of the economy.

Senegal has signed several Bilateral Investment Treaties (BITs), which offer investors from signatory states broader benefits than those provided for in the Investment Code.

Depending on the sectors of activity carried out, the regulations provide for different steps to be followed by foreign investors to obtain authorisation and/or approval.

However, an investment without approval could have negative consequences vis-à-vis its manager, in terms of administrative, pecuniary or penal sanctions.

Investments are governed by several laws and regulations in different sectors of national life, particularly where there is a requirement for approval or authorisation. Requirements relating to compliance with the law on local content, preservation of the interests of neighbouring populations, priority given to local labour, environmental protection and technology transfer, etc, are required and necessary to operate in sectors such as mining, oil, gas, and telecoms, among others.

In Senegal, acts emanating from the administration are required to respect legality – ie, they must comply with all the rules of law forming the block of legality. The principle of legality is implemented by various mechanisms and its violation may be sanctioned by administrative and judicial judges.

The annulment of an administrative decision based on the violation of a rule of law may be pronounced by the Supreme Court, which is the court of first and last instance, of the excess of power of the administrative authorities in the event of a judicial appeal. This appeal is only admissible against an explicit or implicit decision of an administrative authority. The applicant is exempted from the Ministry of Advocacy. However, before contesting an administrative decision, the persons concerned may, within the time limit for appealing for abuse of power, lodge a hierarchical or ex gratia administrative appeal seeking the annulment of the said decision. Silence by the competent authority on the administrative appeal for more than four months shall be deemed to constitute a decision to reject it.

The time limit for lodging an appeal against an administrative decision shall be two months; this time limit shall begin to run only from the publication, notification or service of the decision rejecting the administrative appeal and, at the latest, from the expiry of the period of four months in the event of silence.

During the Council of Ministers held on 15 April 2020, several bills were discussed and adopted, such as: (i) the bill on the extension of time limits in civil, commercial, social and administrative matters and the suspension of expulsion measures; and (ii) the bill on the suspension of appeals, the execution of sentences and the extension of certain time limits, in criminal matters. We are not yet aware of the vote of these bills by the National Assembly and were not able to verify their impact on possible projects in Senegal.

Commercial companies are governed by the Uniform Act on the Law of Commercial Companies and Economic Interest Grouping published on 30 January 2014 (AUSCGIE).

The most commonly used commercial forms in Senegal are, in order, the société à responsabilité limitée (SARL), the société anonyme (SA) and the société par actions simplifiée (SAS).

The Société à Responsabilité Limitée (SARL)

This company is the simplest of commercial companies, in which the liability of the shareholders is limited to contributions.

The SARL may be established by one natural or legal person, or between two or more natural or legal persons.

It does not require any minimum share capital for its creation and its capital is divided into shares.

It is often characterised by a fairly strong intuitu personae, which is why transfers of shares are often governed by specific authorisation rules given by the non-transferring shareholder.

The SARL is managed by one or more natural persons, associated or not.

In addition, the SARL is not required to appoint an auditor unless it meets two of the following conditions at the end of the financial year:

  • a balance sheet total exceeding XOF125 million;
  • an annual turnover exceeding XOF250 million; and/or
  • a permanent staff of more than 50 persons.

The partners of the SARL meet in a general assembly, ordinary (each year for the approval of the accounts of the closed financial year) or extraordinary (for any modification of the articles of association).

The SARL is a corporate form adapted to greenfield projects, commercial activities and services. It is also suitable for young entrepreneurs with few resources due to its low formation cost.

The Société Anonyme (SA)

The société anonyme under AUSCGIE may be held by a single shareholder.

The founder(s) must choose unequivocally in the articles of association for the management and administration between: (i) a société anonyme with a board of directors (from one shareholder) or a société anonyme with a managing director (up to three shareholders).

The minimum share capital of an SA is XOF10 million. It must be fully subscribed by the shareholders and may be paid up at least one-quarter upon incorporation.

The founders of an SA must appoint a statutory auditor and an alternative, chosen from among experts who are members of the National Order of Chartered Accountants and Chartered Accountants of Senegal.

The Société Anonyme with a Board of Directors

The board of directors is composed of a minimum of three persons and a maximum of 12 members, shareholders or not.

The articles of association may require each director to own a number of shares of the company that they preside over.

It is possible to appoint corporate directors who appoint a permanent representative to the board.

The board appoints the chairman of the board of directors from among the natural persons who are members of the board as well as the chief executive officer of the company, who may be one-third of the board.

It may also be decided to appoint a chairman and chief executive officer who will combine both functions.

The board of directors determines the orientations of the company's activity and ensures their implementation. It controls and verifies the proper functioning of the company and settles through its deliberations the matters regarding it.

The chairman of the board of directors presides over board meetings and general meetings. He or she must ensure that the board assumes control of the management of the company entrusted to the chief executive officer.

The chief executive officer is responsible for the general management of the company. He or she represents it in its relations with third parties.

On the proposal of the chief executive officer or the chairman and chief executive officer, the board of directors may appoint one or more individuals to assist the chief executive officer or the chairman and chief executive officer as deputy chief executive officer.

The Société Anonyme with a Managing Director (Administrateur Général)

The managing director assumes, under his or her responsibility, the administration and general management of the company. He or she represents it in its relations with third parties.

He or she convenes and chairs the general meetings of shareholders.

He or she is vested with the broadest powers to act in all circumstances on behalf of the company and exercises them within the limits of the corporate purpose and subject to those expressly attributed to shareholders' meetings by the AUSCGIE and, where applicable, the articles of association.

On the proposal of the managing director, the general assembly may mandate one or more deputy managing director(s) to assist the director as well as decide other powers delegated to the deputy managing director.

Shareholder Meetings

Shareholders meet either in an ordinary general assembly for the approval of the annual accounts, after their approval by the board of directors or by the managing director, or an extraordinary general assembly for statutory amendments.

The SA is a suitable form of company for the establishment of joint ventures, for companies with significant investments to make and for companies engaged in regulated banking or financial activities.

The Société par Actions Simplifiée (SAS) or Simplified Joint Stock companies

Recently introduced in the AUSCGIE in 2014, the SAS is defined as a company set up by one or more shareholders whose articles of association freely provide for the organisation and operation of the company subject to certain mandatory rules (competence of the shareholders' general meeting to approve the accounts or amend the articles of association, for example).

The liability of the partners is limited to the contributions and there is no minimum share capital to create a SAS. When created by a single shareholder, it is called a single-person simplified joint stock company (SASU).

The company is represented by a chairman, appointed under the conditions provided for in the articles of association. The president is vested with the broadest powers to act on behalf of the company within the limits of the corporate purpose.

The articles of association freely determine the decisions that must be taken collectively by the shareholders in the forms and conditions they stipulate. Decisions taken in violation of the statutory clauses are null and void.

The appointment of one or more auditors is optional unless the SAS meet two of the following conditions at the end of the financial year:

  • a balance sheet total exceeding XOF125 million;
  • an annual turnover exceeding XOF250 million; and/or
  • a permanent workforce of more than 50 people.

A SAS that controls or is controlled by one or more companies is also required to appoint at least one auditor.

This form of commercial company is appropriate for companies whose shareholders have different profiles: investors and project leaders, equity companies and companies operating in the field of services and new technologies.

In Senegal, it is mandatory to go through a notary for the incorporation of the company. The steps of incorporation of the company will therefore be followed by the notary.

The incorporation is carried out on an electronic platform and the withdrawal of signed documents is done at the Business Creation Assistance Office located within APIX, the Agency for the Promotion of Investments in Senegal.

The duration is approximately eight to ten days from the signing of the articles of association, of the declaration of subscription and payment, and minutes of the deliberations of the first board of directors.

It will be necessary to have gathered all the required documents and to have paid the share capital with a banking institution or the notary.

When the formalities are completed, the following documents are issued at the same time, on behalf of the new company:

  • a declaration of registration in the Trade and Personal Property Credit Register (RCCM);
  • a tax registration declaration (NINEA);
  • a declaration of existence with the tax authorities; and
  • a declaration of establishment issued by the Labour Inspectorate.

Any amendment to the articles of association must be published in the Trade and Personal Property Credit Register in order to be enforceable against third parties. These amending formalities shall also be published in a legal gazette authorised by the authorities.

In the event of a change in one of the points listed above following a change in the articles of association, in addition to the amending declaration to be registered with the Registry, the change shall be published by a notice inserted in a newspaper of legal notices.

Companies are also subject to disclosure formalities at the Registry in charge of the RCCM of the summary financial statements. They are required to submit to the RCCM, within one month of their approval by the competent body, the summary financial statements, namely the balance sheet, the income statement, the financial table of resources and uses, and the attached statement for the past financial year;

There is not yet a register of ultimate beneficiary in Senegal. However, the legal environment is conducive to this and commitments have been made to this effect by the Senegalese government in view of its membership of the Extractive Industries Transparency Initiative (EITI).

See 3.1 Most Common Forms of Legal Entities.

Similar provisions govern the rules pertaining to the liability of corporate officers and directors in the different types of companies that have been mentioned: SARL, SA and SAS.

A distinction must be made between civil and criminal liability.

Civil Liability

Civil liability of the manager of a SARL and the directors of a SA

The liabilities are similar for the manager of a SARL and the directors of a SA. They are liable, individually or jointly and severally, as the case may be, to the company or to third parties, either for breaches of the laws or regulations applicable to companies, or for breaches of the articles of association, or for misconduct in their management. If several managers or directors have co-operated in the same acts, the competent court shall determine the contribution of each to the compensation for the damage.

In addition to the action for compensation for the damage suffered personally, the shareholders representing one-quarter of the shareholders and one-quarter of the shares may, either individually or by grouping together, intern the social action for liability against the manager or director(s). No clause in the articles of association may make the exercise of the corporate action subject to the prior notice or authorisation of the meeting or entail a waiver in advance of the exercise of this action.

No decision of the meeting may have the effect of extinguishing an action for liability against the managers for misconduct committed in the performance of their duties. Any decision to the contrary is null and void.

Civil liability of the chief executive officer of an SA

The same rules of individual and social responsibility apply to the chief executive officer.

Civil liability of the directors (SA)

Directors are individually or jointly and severally liable to the company or to third parties, either for breaches of the laws or regulations applicable to an SA, or for breaches of the provisions of the articles of association, or for misconduct in their management.

Civil liability of the president/chairman of a SAS

The same rules of individual and social responsibility as those mentioned for the manager and the chief executive officer apply to the president.

Criminal Liability

The AUSCGIE contains criminal provisions in the event of offences committed by corporate officers: these offences relate to:

  • the incorporation of companies;
  • the management, administration and direction of the company;
  • general meetings;
  • changes in the capital of an SA, capital reductions;
  • company control;
  • dissolution of companies;
  • liquidation of companies; and
  • in the event of a public offering for savings.

Law No 2018-13 of 27 April 2018 mentions the penalties incurred for the offences referred to in the Uniform Act.

The sources of Senegalese labour law are both national and international:

  • international sources include International Labour Organization (ILO) Conventions;
  • at the sub-regional level, multilateral agreements have been signed in the framework of the CEDEAO (Economic Community of the West African States) and of the UEMOA (Economic and Monetary Union of West Africa); and
  • national sources are the Constitution of the Republic of Senegal, legislation and regulations, in particular Law No 97-17 of 1 December 1997 about the Labour Code of the Republic of Senegal and its implementing decrees governing the employment contract and any other social relation in Senegal.

Moreover, there are other conventions and collective agreements that are used with the Labour Code. The jurisprudence is extremely important as a national source for labour law. It completes the legislation, as does the doctrine.

An employment contract can be an open-ended contract or a fixed-term contract.

For an open-ended contract, the principle of consensualism is used, which makes a written contract not compulsory. In practice, a written contract is very often used in practice because of its probative force.

Contrariwise, a written contract is obligatory for a fixed-term contract according to Article L44 of the Labour Code. A fixed-term contract cannot exceed two years.

The Senegalese Labour Code fixed the maximum working time to 40 hours a week for all non-agricultural settlement.

The repartition of the 40 hours during the week is at the discretion of the employee.

There are three ways to adapt these 40 hours:

  • an equal repartition – eight hours a day for five days with one day of rest in addition to Sunday;
  • an equal repartition – six hours 40 minutes per day for six working days, with Sunday as the day of rest; or
  • an unequal repartition over five-and-a-half days, with a maximum of eight hours per day to allow the employee to rest half a day more than the regular Sunday.

The employer has a certain freedom in organising the schedules for a working day within the limit of the right of the employees to have a break. Thus, a working day from start to end must not exceed 12 hours (including breaks).

The Labour Code also requires the respect of the principle of weekly rest, which is at least 24 consecutive hours a week. This day is usually Sunday.

Some exemptions exist for companies providing a service to the community that cannot be stopped on a Sunday.


Legal provisions allow 500 hours’ overtime per year and per employee after it has been accepted by the labour inspector.

Hours exceeding the 40 legal hours per week generate a pay raise defined as:

  • 15% from the 41st to the 48th hour;
  • 40% from the 49th hour; and
  • 60% for a night shift.

Moreover, Article 2 of the National Interprofessional Collective Convention states that in compensation for the compulsory legal weekly rest period, a worker who has exceptionally worked at least seven consecutive working days during the week shall receive additional remuneration equal to 60% of his salary.

The termination of the employment contract is initiated by the employer (dismissal) or by the worker (resignation). Another form is amicable termination of the employment contract.


According to the Labour Code, “the termination of the open-ended contract implies a notice in writing by the party who takes the initiative of the termination” and “the reason for termination of the contract must be noted in this notification”.

Dismissal may be retained for misconduct or gross negligence.

In the event of dismissal for simple misconduct, the worker receives a notice and severance pay in addition to his monthly attendance pay and leave.

In the case of dismissal for gross negligence, the worker will not profit from any compensation, only his monthly attendance pay and leave.

If the dismissed worker brings the matter before the court, the judge relies on the facts and documents (alleged faults, dates, documents produced, possibly investigations) to judge at his entire discretion the legitimacy of the dismissal.

If the judge rules against the employer, the latter has to pay damages to the worker. Damages are, as a rule, fixed by the judge taking into account the worker’s salary, his seniority and the judge’s discretion over damage suffered by the worker.

In addition, an employee’s dismissal may be based on economic reasons.

This form of dismissal is subject to a specific procedure. For this dismissal, a social judge shall have sovereign discretion to assess the economic difficulties alleged by the employer.

For fixed-term contracts, early termination is only permitted in the event of gross negligence or agreement of the parties in writing, or in the event of force majeure.

The lack of notification from the employer entitles the worker to compensation.

At the end of an employment contract, the employer must issue a certificate of employment to the employee, under penalty of damages.

In the context of COVID 19, by order No 001-2020 of 8 April 2020, the President of the Republic of Senegal has prohibited any dismissal that is not motivated by a gross misconduct of the worker. Thus, in this context, no employer can dismiss a worker for a simple fault or a serious fault, even less for economic reasons.


The worker’s resignation is never assumed. It must be in writing, and express clearly and unequivocally the will to terminate the employment contract.

Amicable Termination of Employment Contract or Negotiated Departure

At the initiative of the employer or the worker, the termination of the employment contract may result in an agreement between the parties.

In the event of a negotiated departure, the parties agree to pay an amount as a severance bonus in addition to severance pay, notice and leave.

Employees are represented by elected employee representatives following elections held within the company.

Employee representatives must be elected in establishments subject to the Senegalese Labour Code with more than ten workers. This concerns all establishments, whatever their nature (industrial, commercial or agricultural) and regardless of whether the employer is a natural or legal person, public or private.

It is the employer’s responsibility to organise the election of employee representatives. Article 11 of the above-mentioned decree stipulates that the general manager or his representative must announce by letter to the trade union organisations concerned his intention to organise elections. The copy of this letter must be sent to the labour inspector of the jurisdiction.

The date, place and hours of opening and closing of the ballot shall be fixed by the general manager or his representative, after agreement with the trade union organisations.

Representation Assignments

Employee representatives may submit both collective and individual complaints. These complaints mainly concern all the regulations applicable to the company, working conditions, remuneration, social protection of workers, the application of collective agreements, and health and safety measures.

Staff representatives may also refer any complaint or claim relating to the application of legal or regulatory provisions to the labour inspector.

Participation in the Management of the Company

Employee representatives contribute to the good functioning of the company by communicating to the employer all useful suggestions for the improvement, organisation and performance of the company.

Some taxes, namely income tax and the tax representing the minimum tax rate, are borne by the employee but must be withheld and paid to the public treasury by the employer, whereas the flat-rate contribution is borne solely by the employer.

  • Personal income tax is collected each year on: public and private salaries; wages, allowances and bonuses of all kinds; emoluments; salaries; and benefits in cash or in kind. Life pensions and annuities are also subject to the tax. Its rate is between 0% and 40%. This is a tax that must be deducted at source by the employer.
  • The tax representative of the minimum tax is collected by means of a withholding tax for the benefit of local authorities. It is due by any person residing in Senegal and receiving public or private salaries, allowances, emoluments, pensions and life annuities. Its annual amount can vary between XOF900 and XOF72,000.
  • A flat-rate employer contribution is paid by the employer and according to the same terms as the personal income tax. Its rate is 3%.
  • Social Security Contributions are paid by the employee and the employer.

The employer and employee must also pay charges to social security institutions. Thus, a distinction must be made between contributions to the Senegalese Pension Fund (IPRES) and those paid to the Social Security Fund (CSS).

Contributions are based on the gross compensation of the employees, up to a ceiling set each year by the board of directors.

Criteria for Employees to be Subject to Taxation within the Senegalese Jurisdiction

The criteria for personal income tax subjection depend upon the existence of a fiscal treaty between the country of the source of the income and the employee's country of residence.

In the absence of such a tax treaty, foreign workers operating in Senegal are subject to the provisions of articles 48 et seq of the General Tax Code. Under these articles, income tax is due from any individual residing in Senegal, holding income from Senegalese sources or whose income is allocated to Senegal by an international agreement, particularly a tax treaty.

Companies with share capital, such as public limited companies, simplified joint stock company and limited liability companies, are subject to corporate income tax. In principle, other companies may be subject to corporate tax on option.

The taxes applicable to companies doing business in Senegal may vary depending on whether the company is established in the country or is a foreign company with no permanent establishment in the country.

Companies Established in Senegal

Companies established in Senegal shall pay, unless exempted, the following taxes.

Corporate income tax

Under Article 3 of the General Tax Code (GTC), corporate income tax is due on the profits made in Senegal. Profits from companies operating in Senegal are deemed to have been made in Senegal. The corporate tax rate is set at 30% of taxable income. Legal entities domiciled abroad that receive property income in Senegal or capital gains from the sale of real estate located in Senegal or related rights, or realise capital gains from the sale of securities or social rights held in Senegalese companies, are subject to the same corporate income tax.

Flat-rate minimum tax (IMF)

A flat-rate minimum tax (Impôt Minimum Forfaitaire, IMF) is owed by all companies or legal entities that are in deficit or whose taxable income does not allow them to generate a corporation tax higher than the amount determined by a tariff set by the Code. The IMF is due on the turnover, excluding tax, achieved in the year preceding the year of taxation, at a rate of 0.5%, without exceeding XOF5 million. New companies are exempt for three years from their creation.

The local economic contribution (CEL/VL and CEL/VA)

This is a tax imposed for the benefit of the local municipalities.

It is due from any individual who carries on a trade, industry or profession in Senegal and is subject, in addition, to a system of taxation of real profits. Employees are excluded from the scope of the CEL. Exemptions are provided for in the General Tax Code.

The local economic contribution includes a contribution based on the rental value of the premises used for the exercise of taxable professions (CEL/VL) and a contribution on the value added generated during the year preceding the year of taxation (CEL/VA).

The CEL/VL rate is 15% for premises rented or occupied free of charge and 20% for premises, land and installations recorded as assets in the taxpayer's financial statements. The CEL/VA rate is 1% of the added value generated during the previous financial year with a minimum amount of 0.5% from the year preceding that of taxation.

Tax on income from securities (TIS)

The TIS withholding tax applies to income distributed by legal entities paying corporate income tax according to the General Tax Code (GTC).

Legal entities subject to corporate income tax and distributing this income must withhold withholding tax at a rate of 10% and pay it to the Treasury.

When the tax regime of the parent company/subsidiary is applicable, dividends distributed by the parent company are not subject to withholding tax up to the net amount of the shares or interest received from the subsidiary.

Income from shares, company shares and interest shares are subject to the 10% rate, while other income from movable capital is taxed at 16%.

Tax on income from receivables, deposits, guarantees and current accounts

Senegalese tax law provides a withholding tax that must be paid by the party paying interest. However, the GTC provides a number of exemptions.

The IRC withholding tax rate is 16%. A reduced rate of 8% is applied to interest and other current account income of banks, and holding companies fulfilling the conditions of Article 23 of the GTC and other similar bodies.

Royalty tax (BNC withholding tax)

The withholding tax on royalties, also known as the BNC withholding tax (non-commercial profits), must be levied by debtors established in Senegal on sums paid to natural or legal persons subject to income tax or corporation tax who have no permanent professional establishment in Senegal.

The withholding tax rate above is 25% of the net amount of taxable sums paid to natural and legal persons, knowing that this net amount is determined by applying a 20% deduction to the gross collection. With double tax treaties, this rate can be reduced.

Value-added tax (VAT)

VAT is due in Senegal on supplies of goods and services made for consideration by a taxable person per se, as well as imports, provided they are located in Senegal. VAT is due in Senegal only if the beneficiary of the service is established in Senegal or if the service is used there. The Code provides mechanisms for deducting and refunding the VAT borne under certain conditions.

Where applicable, VAT is due from the company at a rate of 18%.

Deduction from wages

This is the withholding tax on income from employment and the Representative Tax on Minimum Tax detailed above. The company must make this withholding and pay it to the public treasury monthly or quarterly.

Withholding tax on amounts paid to third parties

This is a WHT that the company must make from the amounts it pays to natural persons living in Senegal, in compensation for services of any kind provided or used in Senegal. Its rate is 5%.

Tax on the removal of household refuse

The tax on the removal of household refuse (TOM) applies to all properties subject to the land contribution of properties built or temporarily exempted from this contribution, with the exception of factories and built properties located in municipalities or parts of municipalities where the household waste collection service does not operate.

The TOM rate currently applied in Dakar by the Tax Administration is 3.6%.

Property land contributions

Land contributions are of two kinds: the land contribution of built properties and the land contribution of undeveloped properties. Their rate is 5%, unless for the first one the tax is already paid under the CEL/VL.

Current year's municipal tax on advertising

The municipal tax on advertising applies to companies' advertising devices.

The rate can vary from flat rates of XOF20,000 per square metre to fixed amounts of XOF500,000 per year. It is recovered by the municipalities and must be paid before 31 March of each year.

Registration duty and stamps

A certain number of deeds concerning the company must be submitted to the registration formality.

The applicable fees vary according to the nature of the act (proportional or fixed fees).

Overall economic contribution

This is a simplified overall tax regime, introduced for individuals whose annual turnover does not exceed XOF50 million. The rate is 5% for service providers and 2% for traders and producers.

Foreign Company without a Permanent Establishment in Senegal

Foreign companies that do not have a permanent establishment in Senegal may also have to pay a certain number of taxes in the country like a normal company.

Taxes on private vehicles of legal entities

The GTC also provides for a "special tax on legal persons' private cars", which applies to vehicles classified in the category of private cars by the Highway Code and those not subject to a patent.

Various tax credits exist in Senegal. The main tax credits are the following.

Dividend Tax Credit

A tax credit corresponding to the withholding tax on income from investments received by legal entities and effectively included in taxable profits is deducted from the amount of corporation tax.

It is worth noting that this credit can be carried forward over three years. If at the end of the third year it has not been absorbed, the remainder is returned by way of a claim.

VAT Credit

In principle, the VAT paid to suppliers is recovered by charging it against the VAT collected on the sale of goods or services. However, any taxable person, with the exception of resellers in the condition of goods, may request the refund of VAT credit that could not be absorbed by charging.

Investment Tax Credits

Companies making investments of at least XOF100 million may benefit, under certain conditions, from a reduction in the amount of tax due. This amount is reduced to 15 million for small and medium-sized enterprises.

For a new company, the amount of deductions allowed is set at 40% of the amount of investments. However, it is capped at 50% of taxable profit.

The deduction limit is raised to 70% of taxable profit, if the new or expanding company is located in a region other than Dakar.

Special economic zones

Laws 2017-06 and 2017-07 relating to special economic zones provide incentive provisions for eligible companies established in a specific part of the territory. These incentives consist of exemption from national import duties and taxes, a reduction of the corporate tax rate to 15% and a number of other exemptions.

Reduction Granted for Export

Industrial, agricultural and teleservice companies that export at least 80% of their production are allowed to deduct 50% of their taxable profit for income tax purposes.

To benefit from the reduction, eligible companies must provide proof of actual export and repatriation of foreign currency. Indirect exports are excluded in the determination of turnover. In addition, mining and petroleum companies are excluded from the benefit of the provisions of this article.

Tax Reduction for the Promotion of Renewable Energies

Companies manufacturing locally and exclusively goods intended for the production of renewable energies as well as companies producing such energies are authorised to deduct 30% of their taxable profits for the calculation of the corporate income tax for which they are liable.

"Tax consolidation" means a tax regime that allows the income of a subsidiary, held at least 95% or in similar proportions, to be taxed at the level of the parent company. This tax regime allows losses of a subsidiary to be offset against the parent company's income.

However, tax consolidation does not exist under Senegalese tax law.

The Senegalese tax system includes a number of rules designed to avoid undercapitalisation.

As such, the deduction of interest is subject to a double limitation of rate and amount.

In addition, the deduction of interest paid to persons is limited to the remuneration of sums made available to them by such persons that do not exceed the amount of the share capital.

This limitation does not apply to interest paid by companies not subject to corporation tax to their shareholders who are subject to income tax in Senegal because of this interest.

Senegal has transfer pricing rules in its General Tax Code that are regularly updated.

The legal person established in Senegal must keep at the disposal of the Tax Administration documentation to justify the pricing policy applied in the context of transactions of any kind with associated companies established abroad. This obligation applies to the legal person if:

  • it has an annual turnover, excluding tax, of XOF5 billion or more;
  • at the end of the financial year, directly or indirectly, it holds more than half of the capital or voting rights of a company established or incorporated in or outside Senegal, fulfilling the condition mentioned in the first point; and
  • more than half of its capital or voting rights are held, at the end of the financial year, directly or indirectly, by a company fulfilling the condition mentioned in the first point.

A declaration including the country-by-country distribution of the group's profits and economic, accounting and tax aggregates is provided for a certain category of multinational companies.

In addition to the rules to combat transfer pricing, the GTC provides the Administration with a broad power of re-qualification of legal acts and contracts made or concluded by taxpayers.

This also applies to acts giving rise to lower registration fees or making it possible to avoid all or part of the payment of turnover taxes.

The administration can also have recourse to the theory of the abnormal act of management.


Special tax measures were taken following the COVID-19 pandemic. In particular, it was decided to implement the following measures:

  • expediency in the procedure for the reimbursement of VAT credits by the State, through the reimbursement of VAT credits owed by the State within a shortened timeframe in order to provide cash to companies;
  • tax remissions and suspensions, for companies that will commit to keep their workers in business for the duration of the pandemic, or to pay more than 70% of the wages of employees laid off during this period;
  • extension of the deadlines for payment of taxes and duties until 15 July 2020, for SMEs with a turnover of less than or equal to XOF100 million, as well as companies operating in the sectors most affected by the pandemic.
  • partial remission of up to XOF200 billion of the tax debt recorded as of 31 December 2019.
  • extension of the suspended VAT payment deadline from 12 to 24 months, with a view to supporting investment – the suspended VAT mainly concerns companies approved under the Investment Code.
  • Suspension of the collection of the tax and customs debt of the companies most affected by COVID-19.
  • Tax deductibility of aid granted through the FORCE COVID-19 account – donations granted in this context will be considered as deductible expenses for the calculation of the fiscal profit.

Operations such as mergers and acquisitions are not subject to any obligation of notification. They may, however, be subject to control if they result in the creation of a concentration that would lead to an abuse of a dominant position (see 6.4Abuse of Dominant Position). Pursuant to Article 4.1 of Regulation No 02/2002/CM/UEMOA of 23 May 2002, the following constitutes a concentration:

  • a merger between two or more previously independent companies;
  • an operation by which one or more entities already holding control of at least one company, or one or more companies, acquire directly or indirectly, whether by acquisition of equity interests or purchase of assets, contract or any other means, control of the whole or parts of one or more other companies;
  • the creation of a joint venture performing on a lasting basis all the functions of an autonomous economic entity.

Even where there is no obligation to notify concentrations, any interested company may in the context of a future concentration notify the competent authorities for the issue of a negative certificate allowing the competent authorities not to oppose the operation in accordance with the procedural rules set out in 6.2 Merger Control Procedure.

The Commission of the West African Economic and Monetary Union (WAEMU Commission) may exercise a priori and a posteriori control of concentrations. A priori, the WAEMU Commission may issue a negative certificate upon notification of the concentration by the requesting party, in which it shall note, that it is not necessary for it to interfere in the concentration operation in question. This is a preventive measure.

With regard to post-merger control, the WAEMU Commission may, upon request or on its own initiative, establish an anti-competitive practice in general and an abuse of a dominant position in particular. The request may be made by the member states or by any natural or legal person with knowledge of a concentration operation constituting a practice amounting to an abuse of a dominant position. Where an abuse of a dominant position is established, the Commission may require companies either not to proceed with the proposed concentration or to re-establish the previous legal situation, or to amend or supplement the operation or to take any measure to ensure or re-establish sufficient competition.

The Commission shall refer the matter to the Advisory Committee on Competition if it decides to adopt an express measure on the basis of articles 3, 4 or 7 of the Regulation.

If the Committee has not adopted any decision within 12 months of the opening of the contradictory procedure, it is an implicit decision of negative clearance or individual exemption on the basis of articles 3 or 7 of these Rules of Procedure.

Article 3 of Regulation No 02/2002/CM/UEMOA of 23 May 2002 on anti-competitive practices within WAEMU prohibits agreements between enterprises, decisions of associations of companies, and concerted practices that have the object or effect of restricting or distorting competition within the union. The Commission applies a broad interpretation of the concepts of agreements, decisions and practices that can be grouped under the term "cartels". In particular, the existence of a cartel does not necessarily imply a written contract. It is only necessary that the act results from an agreement of will between the parties or from decisions of associations of companies, particularly in the form of deliberations by trade associations. Finally, mere parallel conduct may constitute an agreement or concerted practice.

There is also no practical legislation at community or national level that is capable of uncovering all subsequent violations in order to sanction them when they happen outside the WAEMU zone.

According to Note 3 of Annex No 1 of WAEMU Regulation No 03/2002/CM/UEMOA of 23 May 2002, abuse of dominant position is defined as the situation where a company has the capacity, in the relevant market, to evade effective competition, to free itself from market constraints, by playing a leading role in the market.

Article 4.1 of the WAEMU Regulation No 02/2002/CM/UEMOA of 23 May 2002 provides that the abuse of a dominant position is incompatible with the Common Market and prohibits the abuse by one or more companies of a dominant position in the Common Market or in a significant part of it. It adds that practices amounting to the abuse of a dominant position by one or more companies are subject to the same prohibition.

According to Article 1 of Annex I of the Revised Bangui Agreement of 1999, a "patent" is the title granted to protect an invention. An "invention" is an idea that allows in practice the solution of a particular problem in the technical field. The Bangui Agreement was revised in 2015 but has yet to be implemented, to our knowledge.

The patent shall expire at the end of the 20th calendar year from the filing date of the application, subject to the grounds for revocation provided for in Article 40 of the Agreement.

The Registration Process


The patent application can be made directly to the African Intellectual Property Organisation (OAPI) headquarters but also through the Senegalese Agency for Industrial Property and Technological Innovation (ASPIT, which is the OAPI liaison structure at the Senegal level).

Applicants domiciled outside the territories of the member states make the deposit through a chosen representative in one of the member states.


Patents granted in respect of international applications filed in accordance with the provisions of the Patent Cooperation Treaty shall have effect in member states that are also parties to the above-mentioned treaty.

Issuance, publication and maintenance of patents

OAPI proceeds with the examination of patent applications. It issues patents and publishes them.

Thus, patents granted under international applications filed in accordance with the provisions of the Patent Cooperation Treaty are effective in those member states that are also parties to the above-mentioned treaty.

The grant of the patent shall take place following the decision of the Director General of OAPI or on the decision of an official of OAPI duly authorised to do so by the Director General.

Enforcement and Remedies

Settlement of some difficulties of application

Title in force in a state prior to its implementation of the Bangui Agreement shall continue to have effect in that state in accordance with the law in force at the time of their deposit. Holders of these titles who wish to extend the protection throughout the territory of OAPI before their expiry must formulate an application for extension with the organisation.

Holders of titles in force in OAPI prior to the accession of a state wishing to extend protection in that state shall formulate an application for extension to that effect to the organisation in accordance with the procedure laid down in the application Rules of Procedure.

Sanctions and other means of patent protection

The owner of a patent has a number of means to defend the property of his invention, as follows.

  • Priority claim that allows a person to have the priority of an earlier filing. The request is made to OAPI no later than six months from the date of submission of the application.
  • Nullity: the persons justifying an interest can request the invalidity of a patent in certain cases.
  • Usurpation: whoever – in signs, advertisements, prospectuses, posters, marks or stamps – takes the status of patentee without possessing a patent issued in accordance with this Agreement and its regulations or after the expiry of a prior patent is punished by a fine of XOF1 million to XOF3 million. In the event of a second offence, the fine may be doubled.
  • Infringement: any infringement of the rights of the patentee – by the use of the means covered by his patent, or by concealment, or by sale or display for sale or by the introduction into the national territory of one of the member states, of one or more objects – constitutes the offence of infringement, which is punishable by a fine of XOF1 million to XOF3 million without prejudice to civil compensation.

Final judicial decisions on the validity of patents in one of the member states are authoritative in all other member states except those based on public order and morality.

Decisions on cases of rejection or opposition taken by OAPI may be appealed to the High Commission of Appeal sitting with the said organisation.

Definition and Duration of the Protection

A trade mark is any visible sign used or proposed to be used that is capable of distinguishing the goods or services of any enterprise, including: patronymic names taken in themselves or in a distinctive form; particular, characteristic shape of the product or its packaging; stamps; borders; combinations or arrangements of colours; drawings; reliefs; letters; numbers; currencies; and pseudonyms.

Registration Process

The registration process may be carried out by the body representing OAPI in each member state or by referring it directly to OAPI, in Cameroon.

With the entry into force of the Madrid Protocol, international registration became possible.

A report drawn up by the organisation or ministry responsible for industrial property shall record each filing by stating the date and time of submission of the documents.

The Ministry responsible for industrial property shall transmit the documents to OAPI within five working days from the date of filing.

When OAPI finds that the conditions are met, it registers the trade mark and publishes the registration. The legal date of registration is the filing date.

A certificate shall be issued to the holder of the registration.

Execution and Recourses

When the owner uses his or her trade mark, certain difficulties may arise – in particular, opposition from competitors or legal proceedings before the courts for the cancellation of the trade mark.

The opposition shall take place after the publication of the registration of the trade mark. Its purpose is to allow holders of prior rights to cancel the registration obtained in violation of their rights.

The owner of a trade mark may, by contract, grant a natural person or a legal person a licence to use the mark for all or part of the goods or services for which the trade mark has been registered. If so, the duration of the licence may not exceed the duration of the registration of the trade mark.

An owner of a registered trade mark who has not renewed protection on the anniversary date of the tenth year and has not done so within a grace period of six months following that date may apply for restoration.

With regard to appeals, interested parties may refer the matter to the OAPI Higher Board of Appeal in the event of an unfavourable decision by the Director General. However, there is also the possibility of referring the matter to national courts to hear an action for infringement or unfair competition.

Definition and Duration of the Protection

The industrial design consists of the ornamental or aesthetic aspect of an object. It can consist of three-dimensional elements (for example, the shape or the texture of the object) or two-dimensional (for example, line patterns or colour).

Registration Process

Anyone wishing to obtain the registration of an industrial design shall file or send a registration request (Article 8 annex 4 of the Bangui Agreement) by registered mail with acknowledgement of receipt to OAPI or the ministry responsible for industrial property or the body representative of OAPI in its OAPI member.

Execution and Recourses

The priority claim and restoration mentioned above are also possible with regard to designs.

With regard to appeals, civil actions relating to designs are brought before the civil courts and tried as summary matters.

In the event of an action brought by criminal proceedings, if the defendant raises questions relating to the ownership of the designs in his defence, the competent court shall rule on the exception. The injured party may have an infringement seized. These remedies do not exclude a claim before OAPI.

Definition and Duration of the Protection

The author of an intellectual work enjoys on this work an exclusive intangible property right, enforceable against all and arising solely of the creation. OAPI's member states legislation grants the holder two categories of rights: moral rights and patrimonial rights.

Moral rights include the right of disclosure, the right to authorship of the work, the right to respect the work, and the right to repent and to withdraw.

Economic rights include the right of reproduction, the representation right, and translation, adaptation and distribution rights.

Registration Process

The procedure requires the author or his representative, with power of attorney, to bring to SODAV (Société sénégalaise des droits d'auteur et droits voisins) a copy of the work materialised on paper, or the concept of the work explained in detail on paper; SODAV then grants the author a deposit number that can be used for evidentiary purposes in the event of infringement or plagiarism.

Execution and Recourses

In the event of violation of the author's rights, the civil or criminal courts can be entered. However, they may also request provisional measures and conservatories.

In criminal law, the penalty is imprisonment from six months to two years and a fine of XOF1 million to XOF5 million for the violation of the right to communication to the public, the right of reproduction, the right of distribution or the rental right.

Other more severe sanctions are also provided for by articles 142 et seq of Law No 2008-09 of 25 January 2008 on copyright and related rights in Senegal. In civil matters, the court may order the cessation of the unlawful act but also compensation for the damage suffered.

Where software, databases or trade secrets are original works, they should be eligible for copyright protection. Otherwise, it is common practice to combat infringements of the rights attached to them on the basis of infringement or unfair competition action, depending on the case and the factual circumstances. Piracy is also criminally punishable.

In Senegal, the protection of personal data is provided and protected through Law No 2008-12 of 25 January 2008 on the Protection of Personal Data, the purpose of which is to set up a legal framework that will permit a fight against privacy breaches.

Besides this essential law, others were voted and blended in the Penal Code in order to sanction the breach of rights protected by the law of 2008.

These laws have an essentially national scope, applicable in the Senegalese territory or any place where the Senegalese law is applicable.

They may produce their effects and apply to acts that are not committed on the national territory either by using local means of treatment or by having direct effects on it in the territory concerned.

The Commission for the Protection of Personal Data in Senegal is an independent administrative authority responsible for ensuring that processing of personal data is implemented in accordance with the provisions of Law 2008-12. It informs the concerned persons and the data controller of their rights and obligations, and ensures that the information and communication technologies do not pose a threat to public freedoms and privacy.

Houda Law Firm

66 Boulevard de la République
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Senegal BP 11 417

+221 33 821 47 22 / 35

+221 33 821 45 43
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Law and Practice in Senegal


Houda Law Firm was founded in 1977 in Dakar (Senegal) and consists of a 42-person staff, half of which are specialised and highly qualified lawyers and legal advisors working to assist clients – such as private companies, public entities, and individuals – with all of their legal needs in Senegal and WAEMU (West African Economic and Monetary Union) member states. The firm opened a branch in Abidjan, Ivory Coast, which made it the very first foreign law firm from the WAEMU region established in the country. Houda's team works on matters related to company incorporation, investment, employment law, taxation, business litigation and arbitration. The firm is in the process of finalising ISO 9000-2015 certification.