in cash, capital goods or both; and where a non-citizen wholly owns the business, a minimum of USD 500,000 in cash, capital goods or both must be invested. Foreign investors who engage in trading, i.e. the buying and selling of imported goods and services, must meet a minimum capital requirement of USD 1,000,000 and must employ at least 20 skilled Ghanaians. This minimum capital requirement does not apply to portfolio investments or enterprises set up for export trading. Entities that meet the investment terms set by the GIPC are entitled to automatic expatriate quotas (discussed in the immigration and employment section below) and other incentives. Other benefits of GIPC registration are tax incentives, absolute protection against nationalization or expropriation and a guarantee that capital, dividends and net profits may be transferred outside Ghana (subject to foreign exchange laws) in freely convertible currency. The Ghana Free Zones Board ( GFZB ) is also a government agency established to enable the creation of free zones in Ghana, to regulate free zones activities within the country and for other related purposes. A free zone company is an enterprise that exports at least 70% of its annual production. The legislation governing the GFZB creates an attractive and conducive business environment through the provision of extensive and generous free zone incentives. An enterprise shall not be licensed as a free zone developer or carry on business or trade within a free zone unless it is a body corporate or a partnership registered under the laws of Ghana. A licensed free zone entity has the right to produce any type of goods or services for export provided that it is not environmentally hazardous. Free zones licences will however, not be granted for the business of banking or insurance unless the entity is licensed and registered by the relevant regulatory authority. A major incentive for the creation of a free zone enterprise in Ghana is that the laws relating to import and export of goods and services (other than consumer goods for commercial purposes) do not apply to import of goods to a free zone enclave or the dispatch of goods for export from a free zone enclave. Other incentives available to free zone companies are as follows: • 100% exemption from payment of direct and indirect duties and levies on all imports for production and exports from free zones;
• 100% exemption from payment of income tax on profits for 10 years from the date of commencement of operation and income tax thereafter shall not exceed 8%; • total exemption from payment of withholding taxes from dividends arising out of free zone investments; • relief from double taxation for foreign investors and employees; • no import licensing requirements; • minimal customs formalities; • 100% ownership of shares by any investor, foreign or national, in a free zone enterprise is allowed; • there are no conditions or restrictions on the repatriation of dividends or net profit, payments for foreign loan servicing, payments of fees and charges for technology transfer agreements and remittance of proceeds from sale of any interest in a free zone investment; and • ability to operate foreign currency accounts with banks in Ghana. Free Zone investments are also guaranteed protection against nationalisation and expropriation. Immigration, Employment and Local Content The Ghana Immigration Service is the primary governmental agency responsible for the entry, residence and employment of foreigners in Ghana in accordance with provisions of the Immigration Act, 2000 (Act 573). Ghana’s immigration regime also involves other industry agencies and regulators that follow a variety of rules in the immigration process including the implementation and monitoring of immigration quotas to control the work authorisation processes for companies intending to employ foreign nationals. Businesses registered with the GIPC are entitled to automatic expatriate quotas depending on the paid up capital. An enterprise with a paid capital of not less than: • USD 50,000 and not more than USD 250,000 is entitled to an expatriate quota of one (1) person; • USD 250,000 and not more than USD 500,000 is entitled to an expatriate quota of two (2) persons; • USD 500,000 and not more than USD 700,000 is entitled to an expatriate quota of three (3). • If the paid capital is more than USD 700,000 the enterprise is entitled to an expatriate quota of four (4) persons.
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