Doing Business In... 2023 Comparisons

Côte d’Ivoire has a civil legal system. The private judiciary is made up of courts of first instance, Courts of Appeal and the high court called “la Cour de Cassation”. Alongside the state courts, there is a community court: the Common Court of Justice and Arbitration. For disputes with public bodies, private courts have jurisdiction in the first instance. As a last resort, there is a court called the “Conseil d’Etat”.

Private investment in Côte d’Ivoire, whether foreign or local, is in principle unrestricted. Authorisations are required only for specific sectors, governed by specific regulations. These include, but are not limited to, the energy sector (gas, oil, electricity, etc), the information and communication technology sector, the mining sector, etc. As a general rule, the acquisition of specific authorisations is subject to the completion of at least part of the investment. A legal entity (notably a company), with a specific form and minimum capital, must be created, and licences and authorisations from the state body responsible for granting authorisations are also often paid for.

There is no single or uniform authorisation procedure. It depends on the sector of activity concerned, the relevant legislation, and the authorities involved. The authorities granting authorisation vary. However, in all cases, without authorisation, the activity cannot be carried out. Unauthorised exercise of the activity concerned may be punished by the payment of a fine, the cessation of activities, or even penal sanctions in certain cases.

The authorities generally require applicants for authorisation to produce a certain number of documents, and to make commitments on issues such as contribution to sustainable development and non-degradation of the environment. The precise content of the commitments expected from the investor varies depending on the activity for which authorisation is required.

In general, authorisations fall within the sovereign power of the government and its agencies. If an authorisation is refused, the investor can lodge a hierarchical appeal with the administration itself. In certain special cases, the matter may be referred to the judicial authorities.

There are five main types of company in Côte d’Ivoire, all governed by the OHADA’s Uniform Act on Commercial Company Law. But, according to the CEPICI (Centre for the Promotion of Investments in Cote d’Ivoire), the two most common types of corporate vehicle are the public limited company and the private limited company.

In public limited companies, shareholders’ liability is limited to their contributions. The company may or may not have a board of directors. Day-to-day management is carried out either by the Managing Director, the Chief Executive Officer or the Chairman and Chief Executive Officer. The minimum capital is XOF10 million. It may be formed by a single shareholder or by several shareholders. In general, this type of corporate form is used for large companies, which may need to open up their capital to the general public. Moreover, shares are negotiable and can be freely sold unless the articles of association stipulate otherwise. This vehicle is suitable for important projects, holdings, joint ventures, since the liability of the shareholders is limited and the shares can be easily transferred. Also, the company may issue securities which can be listed on the stock exchange.

In the private limited company, the liability of the partners is also limited to their contributions. The management of the company is ensured by a manager. The minimum capital is XOF1 million. However, the shares are not negotiable. The sale of shares requires the agreement of the partners. Limited liability companies are not open to the public like public limited companies. For all those reasons, it is not a form suitable for major, international projects or holdings.

In practice, the main steps in setting up a company are as follows. The company’s incorporation file consisting of documents (authenticated articles of association, notarised declaration of subscription and payment, etc) communicated by the government agency (CEPICI) must be filed there. The process then continues with the payment of the costs of incorporation of the company. Finally, the documents attesting to the creation of the company are released.

Companies are effectively subject to reporting obligations. First, the founders and first members of the management bodies of the company make a declaration to the register of commerce and personal property credit in which they indicate the operations carried out to validly constitute the company and the conformity of these operations with the deed (according to provisions under OHADA’s Uniform Act Relating to Commercial Company Law). In addition, with regard to financial statements, they must be presented and filed, after the end of each financial year, with the register of commerce and personal property credit (RCCM).

The management structures in place depend on the form of the entity. In public limited companies, management is carried out by either the managing director or the chief executive officer (when the company has a board of directors), or the managing director (when the company does not have a board of directors).

In simplified joint stock companies, management is the responsibility of the chairman or any other person designated by the articles of association. In all other types of company, management is carried out by a managing director.

In accordance with the provisions of Articles 161 et seq of the OHADA Uniform Act Relating to Commercial Company Law, corporate officers are liable to third parties, to the company itself and to shareholders, for faults committed during the performance of their duties. However, when the fault is committed on behalf of the company, the company is liable to third parties, and may take action against the executive who committed the fault.

The rules governing labour relations are first and foremost legal: to this end, there is Law No 2015-532 of 20 July 2015 on the Labour Code, as well as several implementing decrees. Further, there is the interprofessional collective agreement of 19 July 1977, which also governs labour relations. Case law intervenes in the application of rules applicable to employment contracts. Last, but not least, labour relations are governed by employment contracts between employers and employees.

Articles 15.1 et seq of the Ivorian Labour Code provide for two categories of employment contracts: fixed-term and open-ended. Fixed-term contracts must be in writing, except in the case of contracts for daily workers hired by the hour or by the day, for short-term employment and paid at the end of the day, week or fortnight. The term must not exceed two years. Contracts for indeterminate employment do not necessarily have to be in writing. They can be concluded verbally.

In accordance with Article 1 of Decree No 96-203 of 7 March 1996, the maximum working week is 40 hours for non-agricultural businesses and 48 hours for agricultural businesses and similar enterprises. Weekly working hours eligible for equivalence may be longer, up to 44 hours for non-agricultural businesses and 52 hours for agricultural businesses.

Employees are free to choose whether to work overtime. No worker may be dismissed for refusing to work overtime. Overtime is paid at the rates laid down by law:

• 15% extra for hours worked from the 41st to the 46th hour;
• 50% for hours worked beyond the 46th hour;
• 75% increase for hours worked at night;
• 75% increase for hours worked during the day on Sundays and public holidays; and
• 100% for hours worked at night on Sundays and public holidays.

The “employment at will” is not practised in Côte d’Ivoire. Employment contracts can be either fixed-term or open-ended. In the case of a fixed-term contract, it terminates at the end of the term stipulated in the contract. At the end of the contract, the employee is paid a termination allowance. Termination by the employer before the stipulated term will be considered as unfair dismissal. The employee will be entitled to compensation in the event of unfair dismissal. In the case of open-ended employment contracts, the contract may be terminated by the employer if there is a legitimate reason, or by the employee himself.

In both cases, a notice period must be observed, depending on the employee’s length of service. If the termination initiated by the employer is abusive, it is referred to as “abusive dismissal”. In this case, the employer pays all the indemnities provided for in the Ivorian Labour Code. In the event of termination at the employee’s initiative, the contract is deemed to have been resigned. The employee is therefore not entitled to compensation.

Dismissals for economic reasons are governed by Articles 18.9 et seq of the Ivorian Labour Code. Employers contemplating redundancies for economic reasons must organise an information meeting with staff representatives (who may be assisted by union representatives) and the labour inspector. Fifteen days before the planned meeting, the employer must send the National Council for Social Dialogue and the Labour Inspector a file containing the reasons for the dismissal, the criteria for the dismissal, the list of personnel concerned, the date of the dismissal and any other useful documents. Employees made redundant in this context benefit from priority hiring for a period of two years.

In accordance with Article 1 of Decree No 96-207 of 7 March 1996, the election of staff representatives is compulsory in companies with a total of at least ten employees. They represent the employees and ensure that their rights are respected by the employer. The staff representatives are consulted when making decisions affecting the lives of employees.

Taxes can be divided into two categories: employee and employer withholding taxes and social security contributions. Wage-earners’ withholding taxes are supported by the employee’s salaries. They are made up of the wage tax (1.5% of the gross taxable wage after a 20% reduction, ie, just 1.2% of the gross taxable wage); the national contribution, calculated according to a progressive rate per bracket after a 20% reduction of the basic taxable wage; the general income tax and the Contribution for National Wage Reconstitution. Social security contributions are made to the pension fund at a rate of 3.2% of the CNPS taxable base.

For employer’s tax and social security deductions, the first is payroll tax at a rate of 1.2%, rising to 3.5% depending on the system. For expatriates, the rate is 10.4%. Next, there is apprenticeship tax at 0.4% and the continuing education tax at 1.2%. These taxes are borne by the employer. Social security deductions cover family benefits, work-related accidents and the pension fund, according to specific rates. These benefits are paid for by the employer.

Companies may be subject to a variety of taxes. The main taxes are as follows: to start any lucrative activity, they are obliged to pay the patent. Depending on the nature of the activity, there may be other taxes and authorisations to pay. The activity will certainly be run from premises. The use of these premises will entail payment of property tax. Transactions between the company and its partners, including banks, will entail payment of tax on banking transactions and tax on debt income.

Companies may have to pay VAT on their purchases. Under certain conditions, they may be able to reclaim this VAT and exercise the right to deduct it. They pay income tax on their profits, when they are subject to a real taxation system. In the event of dividend distribution, this is liable to tax on income from securities. There may also be specific taxes, such as the special equipment tax, the water use tax or other taxes of this kind.

Two systems of tax credits and incentives are available. One is governed by the Investment Code and the other by the General Tax Code.

The Investment Code has introduced two tax incentive schemes: the declaration scheme and the approval scheme. The declaration system is as follows (Article 11 Investment Code).

• Zone A: a tax credit of 25% on profits tax including MFI, patents and licences contribution, property wealth tax, VAT, employers’ contribution in respect of local employees.
• Zone B: a 35% tax credit on income tax including MFI, patents and licences, property tax, VAT, employers’ contribution for local employees.
• Zone C: a tax credit of 50% on profits tax including MFI, patents and licences contribution, land tax, VAT, employers’ contribution for local employees.

The accreditation system operates at two levels: in the implementation phase and in the operating phase. The implementation phase involves the following.

• An exemption from customs duties, with the exception of the statistical fee, and community and litigation levies.
• A temporary suspension of VAT, on the acquisition of goods, services and works. The benefit of this exemption is subject to the presentation, by the operator, of an investment approval certificate issued by the agency responsible for promoting investments (Articles 14–16 of the Investment Code).

In the operational phase, large companies (those belonging to category 2, NTIC operators) benefit from tax credits determined as a percentage of the amounts invested, the rates of which are as follows:

• a tax credit of 25% chargeable to the tax on profits including the IMF, the contribution of patents and licences, the tax on the property heritage, the VAT, the contribution payable by employers in respect of local employees, in zone A; 
• a tax credit of 35% on the tax on profits including the IMF, the contribution of the patents and licences, the tax on the real estate inheritance, the VAT, the contribution at the expense of the employers in respect of local employees.

The Investment Code provides further credits. The General Tax Code also provides for tax credits for job creation, obtaining patents, etc.

The general tax code of Côte d’Ivoire does not provide for tax consolidation.

There are equivalent rules with the provisions of Article 372 of the OHADA Uniform Act Relating to the Law of Commercial Companies. This article provides that when the shareholders’ equity becomes less than half of the share capital, the company must be dissolved, or this capital must be reconstituted.

Transfer pricing legislation is not well developed in this jurisdiction. Within the framework of the West African Economic and Monetary Union (UEMOA), initiatives are taken to adopt regulations on the transfer of prices. At the national level, the tax administration can carry out checks on financial establishments and the central bank.

In order to fight against any tax evasion, the weapon available to the Ivorian administration is tax control, governed by the book of tax procedures. On the discovery of any fraud, sanctions can be pronounced against the perpetrator: fines, penalties, increases in the tax due or even criminal sanctions.

In terms of information, the only requirement for mergers is that they be published in the RCCM and in a legal newspaper, in order to inform third parties, creditors in particular (Uniform Act on Commercial Company Law).

First of all, companies must agree to undertake the merger. The merger project must then be approved by extraordinary general meetings of the companies that intend to merge, by deliberation. All documents relating to the merger must then be sent to the shareholders, fifteen days before the holding. The documentation contains the terms of the merger: the exchange parity, the merger premium, the capital increase, the assessment of the contributions.

Notification of the merger project is published within a certain period in a legal announcement newspaper, then in the register of commerce and personal property credit. The merger then takes effect.

Anti-competitive agreements and practices are governed, in Côte d’Ivoire, by Ordinance No 2013-662 of 20 September 2013 relating to competition. It incorporates all the community provisions on competition. It is territorial in scope and applies to all anti-competitive practices carried out on Ivorian territory or which produce their effect on Ivorian territory. Agreements and practices are illegal only when they are made to impede competition.

The cited 2013 Ordinance also applies to unilateral conduct and economic dependencies likely to distort competition. Economic expenditure refers to the existence of a dominant position in a market. It becomes illegal when used to distort free competition.

Patent is, in accordance with Article 1 of Annex 1 to the Bangui Convention on Industrial Property, the title issued to protect an invention. The patent expires at the end of the 20th calendar year from the date of filing of the application. Anyone wishing to obtain a patent for invention must file the request or send it by registered post (with request for acknowledgment of receipt) to the organisation or to the ministry in charge of industrial property. The application should contain certain elements, including: its request to the Director General of the Organisation, in prescribed number of copies; proof of payment to the organisation of the filing fee and the publication fee; a private power of attorney, without stamp, if the applicant is represented by a representative. Appeals are made to the African Organisation of Intellectual Property (OAPI), the body that issues patents.

In Côte d’Ivoire, trade marks are regulated by Annex III to the Bangui Agreement, which created the OAPI. They include:

• trade mark of products or services;
• any visible sign used or that one proposes to use and which is suitable for distinguishing the products or services of any company and, in particular, surnames taken in themselves or in a distinctive form, particular, arbitrary or fantasy; or
• the characteristic shape of the product or its packaging, labels, envelopes, emblems, imprints, stamps, seals, vignettes, borders, colour combinations or arrangements, designs, reliefs, letters, numbers, currencies, pseudonyms.

The request must be sent to the organisation or ministry in charge of trade marks, together with the required documents. A minute is then made by the organisation or ministry in charge of trade mark property to attest receipt of the request and ensure all the requirements of the Bangui Agreement are respected. If all the conditions are met, the organisation proceeds to registration of the design. If the conditions are not respected, the irregularity is notified to the applicant, which can regularise it within a three-month time limit. The trade mark protection period is ten years.

An industrial design can be defined as any assembly of lines or colours, or a model of any plastic shape, whether or not associated with lines or colours, provided that this assembly or shape gives a special appearance to an industrial or handicraft product and can serve as a type for the manufacture of an industrial or artisanal product. The request must be sent to the organisation or ministry in charge of industrial property, together with the required documents. A minute is then made by the organisation or ministry in charge of industrial property, to attest the receipt of the request and ensure all the requirements of the Bangui Agreement are respected. If all the conditions are met, the organisation proceeds to registration of the design. If the conditions are not met, the irregularity is notified to the applicant, who can sort it within a three-month time limit. The length of protection is five years.

Copyright is protected by the Ivorian law on copyright of 26 July 2016. Copyright is defined in this jurisdiction as all the rights owned by an author over an intellectual work. Those rights can be of moral (right of paternity, right of disclosure, right of withdrawal) and patrimonial (right of reproduction, right of renting and distribution, right of representation). Copyright protection is acquired through the creation of the work. According to the Ivorian law on copyright, any infringement of the aforementioned right constitutes the offence of counterfeiting, which can lead to a fine of XOF500,000 to XOF5 million and a prison sentence of one to ten years.

In the Ivorian jurisdiction, software and databases may give rise to patents. Thus, they will be protected as benefiting from patents. As for trade secrets, they are protected by rules regulating anti-competitive behaviour. Unfair competition actions can then be brought against anyone who violates a trade secret. There are even criminal penalties.

In Cote d’Ivoire, the main regulation applicable to data protection is the Law of 19 June 2013 Relating to the Protection of Personal Data. The law aims to define personal data, when and who can collect and process it, and when an authorisation is required. The law also sets out the applicable sanction in case of a breach of its provisions.

The Ivorian law on data protection has an international scope. Indeed, Article 3 of the law states that its provisions are applicable to any collection, any transmission, or any storage of personal data in Cote d’Ivoire. If a foreign company targets customers in Cote d’Ivoire, the law will definitely be applicable.

Also, according to Article 7 of the law on data protection, before any transfer of data from Cote d’Ivoire to a third party country, ie, a country which is not part of the Economic Community of West African States (ECOWAS), an authorisation must be obtained from the Ivorian Authority for Regulation of Telecommunication (ARTCI). Finally, it should be noted that the transfer of data to a third party country can only be authorised if it has a higher or equivalent level of protection of freedoms and personal data to Cote d’Ivoire.

In Cote d’Ivoire the agency in charge of enforcing data protection rules is the Authority for Regulation of Telecommunication (ARTCI) created in March 2012. The mission of the authority can be set out as follows:

• regulation of the telecommunications sector;
• security of networks and information systems;
• protection of personal data;
• management of electronic transactions; and
• management of domain names and internet addresses of Cote d’Ivoire.

In order to fulfil its mission, the ARTCI has extensive powers. First, it has a normative power, which means it can define and implement legal provisions. Secondly, it exercises control to monitor whether the regulations of its sectors are respected. Finally, if the ARTCI is aware of a breach of regulation, it has the power to impose administrative or pecuniary sanctions.

Major legislative reforms are not expected in these legal fields in the near future. However, Cote d’Ivoire is a country in constant evolution, continually making improvements to its legal system and economy.