Being the first step to establish any form of company, the foreign shareholders must pay real attention to the procedures of transfer of their contribution in the capital to Algeria.

The transfer of capital as well as the increase of capital can be in cash as it can be in kind.

Contributions “in kind” consist of the contribution of movable or immovable, tangible or intangible assets: vehicles, premises, patents, trademarks, et cetera.

It can take place in several ways, such as the transfer of ownership, by usufruct or by user license. Moreover, the” in kind” contributions can also be part of the capital increase in an existing company.

Then, it is of essence to assess its process in order to avoid issues in its performance, keeping in account that its performance locally or from abroad implies different peculiarities.

What about the transfer of contribution “in kind” locally?

The transfer of in-kind contribution may be performed in Algeria and it is subject to a complex evaluation process.

Firstly, the shareholders autonomously have to determine the value of the contributions in kind. Secondly, a qualified expert is appointed by the shareholders within the framework of the establishment of a company or the increase of share capital.

What will happen in the absence of an agreement on the expert? In this case, the judge will proceed with the said appointment, upon request filed in two original copies by the legal representative.

Moreover, the qualified expert will perform an assessment of the asset to be transferred. At the end of its mission, the expert will submit the assessment report to the company.

What about intellectual property contributions? the registration certificate of the patent, trademark or any other asset is required.

Thus, the in-kind contribution must follow all the previous procedures to be accepted as a part of the share capital or a capital increase.

startup algerie

Investment law : the transfer of share capital in kind to Algeria

How is the transfer of in-kind contribution done from abroad?

The transfer of the in-kind contribution to Algeria from abroad is possible and it is subject to formal procedures. Firstly, what are the procedures for the movable assets? the shareholder must enjoy an authorisation for the entry of the assets to Algeria.

In addition, a declaration with the required commercial and customs documents must be filed before the Central Bank. Following that, the same evaluation process that the local in-kind contribution will be due.

Secondly, what about the immovable assets? the assessment will be performed in the foreign country where the asset is located, by a qualified property expert appointed according to the law of the foreign country.

In addition, the assessment report performed will be certified by the Algerian consulate in the foreign country.

Thus, how can the in-kind contribution be recognised and accepted in Algeria? the movable assets must enter Algeria in a legal way and must be declared to the Central Bank.

Furthermore, the foreign assessment report of the immovable assets must be certified in the Algerian consulate abroad.

It is important to underline that all shareholders will be jointly and severally liable, on the totality of their assets, against the value attributed to the in-kind contributions, for a period of 5 years.

This is to guarantee the cash flow of the capital when there are in-kind contributions.

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