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How to start a business in Somalia as a foreigner (2026)

Starting a business in Somalia as a foreigner: moderate.

On paper, Somalia is unusually open to foreign business formation: the 2019 Companies Law and a World Bank/IFC-backed online registry (launched March 2022) allow 100% foreign-owned companies, impose no minimum capital, and reduced registration to roughly three online steps with certificates issued in about one working day (around four days on average overall). In practice, however, weak institutions, federal fragmentation (procedures differ between Mogadishu and member states), security risks, and inconsistent application of investor-protection guarantees make the real-world environment difficult, Somalia ranked last (190/190) in the World Bank's final Doing Business 2020. Hence the formal regime is easy but execution is constrained.

Last verified Official sources first · MethodologyCompare Somalia with other countries

Legal framework

Companies Law No. 18 of 26 December 2019 (and its Regulations) administered by the Office of the Company Registrar at the Federal Ministry of Commerce & Industry, via the eBusiness.gov.so portal; Foreign Investment Law No. 13 of 21 January 2016 (foreign investor registration, administered with the Somalia Investment Promotion Office, SOMINVEST).

Key points: starting a business in Somalia

  1. Full foreign ownership allowed

    Foreign investors may own 100% of a company and may incorporate a single-director, fully foreign-owned local entity without a local partner; there is no formal 'negative list' of sectors closed to foreigners, though agriculture, livestock, fishing, minerals and industry are prioritized for incentives.

    investmentpolicy.unctad.org state.gov

  2. No minimum capital

    There is no minimum capital requirement to start or register a company in Somalia under the Companies Law regime.

    sominvest.gov.so ebusiness.gov.so

  3. Streamlined online registration

    The eBusiness.gov.so system (launched March 2022 with IFC/World Bank support) cut registration to about three online steps from nine, with the incorporation certificate issued within one working day and an average overall turnaround of around four days.

    worldbank.org ebusiness.gov.so

  4. Core setup steps

    Reserve/verify the company name, submit incorporation documents to the Company Registrar at the Ministry of Commerce & Industry and pay fees to receive the registration certificate, then obtain a Tax Identification Number (TIN); foreign companies receive a separate Certificate of Registration of a Foreign Company.

    sominvest.gov.so moci.gov.so

  5. Annual license renewal

    Business licenses must be renewed yearly, with renewal costing roughly 50% of the original registration fee.

    sominvest.gov.so

  6. Practical constraints

    Somalia's federal structure means procedures vary between Mogadishu and member states, and weak rule of law, security risks, and inconsistent application of foreign-investment and capital-repatriation guarantees undermine the open legal framework; Somalia ranked 190th of 190 in the World Bank's Doing Business 2020.

    state.gov doingbusiness.org

Sources

  1. ebusiness.gov.so/resources/company-law-regulations-english
  2. ebusiness.gov.so/
  3. moci.gov.so/licensing-and-business-registration/
  4. sominvest.gov.so/procedures/registeration/
  5. investmentpolicy.unctad.org/investment-laws/laws/65/somalia-foreign-investment-law
  6. worldbank.org/en/news/feature/2022/06/27/going-digital-makes-life-easier-for-somali
  7. state.gov/reports/2025-investment-climate-statements/somalia
  8. doingbusiness.org/content/dam/doingBusiness/country/s/somalia/SOM.pdf

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Orientation, not legal advice: verify against the primary sources linked above. Last verified 24 May 2026. Methodology & how to cite · State of Technology Regulation 2026