Formal registration of companies has many immediate benefits for the companies and for business owners and employees. Legal entities can outlive their founders. Resources are pooled as several shareholders join forces to start a company. Formally registered companies have access to services and institutions from courts to banks as well as to new markets. And their employees can benefit from protections provided by the law. An additional benefit comes with limited liability companies. These limit the financial liability of company owners to their investments, so personal assets of the owners are not put at risk. Where governments make registration easy, more entrepreneurs start businesses in the formal sector, creating more good jobs and generating more revenue for the government.
Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Botswana. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.
This information was collected from World Bank: Doing Business
* Takes place simultaneously with another procedure.
This information was collected from World Bank: Doing Business
| No. | Procedure | Time to Complete | Associated Costs |
|---|---|---|---|
| 1 | Select and reserve company name | 3 days | BWP 20 |
| 2 | Sign the declaration of compliance of statutory requirements for incorporation before a commissioner for oaths | 1 day | BWP 75 |
| 3 | Return the complete statutory return to the Registrar of Companies about re-allotment, directors, auditors, company secretary, and registered officers | 1 day | BWP 300 by self, and a fee of BWP 2000 where registration is done by agent |
| 4 | Register the company with the Registrar of Companies at the Ministry of Commerce and Industry | 2-3 weeks | BWP 360 (Registration of constitution) |
| 5 | Advertise the intention of applying for a license in the official gazette | 3 weeks | BWP 80 |
| * 6 | Obtain an approval of the working condition after an inspection of company premises | 2 days,( simultaneous with procedure 6) | As part of the application procedure the firm’s premises will be inspected by the health and environmental authorities to ensure compliance with minimum standards. The cost would be no charge as this Procedure is done by the municipal authorities as part of the application Procedure for a trading license or an industrial license. |
| * 7 | Obtain an industrial license from the Industrial Affairs Department, Ministry of Commerce and Industry; or obtain a trading license from the local authority | 3 weeks ( simultaneous with procedure 5 ) | BWP 100 for industrial license if applied by self; BWP 1,500 by agent; BWP 60 for trade license if applied by self, BWP 2,000 by an agent |
| 8 | Register for Corporate Income Tax number with the Botswana United Revenue Services and obtain the approval from the Commissioner of Taxes for the appointment of a public officer who is in charge of tax return | 7 days | no charge by self, BWP 1,500 by agent |
| 9 | Register for VAT with Director of Customs & Excise | 7 days | no charge by self, BWP 1,500 by agent |
| 10 | Register employees for the work injury insurance | 1 day | no charge |