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How to invest in Lebanon? |
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Lebanon has traditionally been a country open to foreign direct investment. Over the last three years, the GOL passed several laws and decrees to encourage investment. There is no specific legislation on foreign investments, but all aspects of setting up a business are governed by the Lebanese Commercial Code and Regulations and the Investment Development law n°360 of 16 August 2001. |
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Lebanon |
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How to invest in Lebanon? |
A foreigner can establish a business under the same conditions that apply to a Lebanese national, provided the business is registered in the Commercial Registry. A foreigner must first obtain residence and work permits before registering his or her business. There are no sector-specific laws on acquisitions, mergers, or takeovers, except for bank mergers.
Lebanese law does not differentiate between local and foreign investors, except in the area of land acquisition. Several types of companies can be created: joint stock companies (Société Anonyme Libanaise - SAL), limited liability companies (Société à Responsabilité Limitée - SARL), partnerships limited by share (Société en Commandite par action - SCPA), holding companies, offshore companies, partnerships, joint ventures, or agencies/branches of foreign companies.
A 2001 law on investment promotion was enacted to promote opportunities and encourage investment in the fields of industry, tourism, agriculture, and food processing industries, marine resources, media, and information technologies. It established a "one-stop shop" service at the Investment Development Authority of Lebanon (IDAL) to facilitate procedures and better assist investors. However, these measures have had limited impact so far on competitiveness and administrative procedures for doing business are still too lengthy and burdensome. There are no special financial provisions for or constraints on foreign investors except that certain restrictions exist on foreign ownership of banks and companies involved in media activity, land ownership, and the employment of foreign labour.
Lebanon's membership in the Multilateral Investment Guarantee Agency (MIGA) is a means of building confidence among potential foreign investors. In addition, the National Institute for the Guarantee of Investments makes insurance coverage available to investors, providing compensation for losses resulting from non-commercial risks. Commercial and civil companies must register at the Civil Companies Registry at the Court of First Instance. Foreign companies can operate in Lebanon either as a branch or as representational office, both of which must register and obtain a license in order to do business.
The Lebanese government recognises the importance of foreign investment and is actively working to provide a more conducive environment that enables investors to bring or establish their operations in Lebanon. Within this framework, Investment Development Law 360 empowers IDAL to offer a wide range of investment incentives, depending on the qualifications and criteria for each project.
With respect to the Investment Development Law, IDAL categorises investment projects according to geographic location, sector, investment cost, and other criteria. Sectors include industry, agriculture, agro-industry, tourism, information technologies, telecommunications technologies, and media. The new Investment Development Law 360 of 2001 divides Lebanon into three investment zones: A, B and C. Incentives for investment projects are based on the investment zone in which the project is classified. |
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