Doing Business

The commercial law of Tunisia recognizes two types of companies; share companies and companies of persons (partnerships). Foreigners are permitted to hold shares in Tunisian companies without restriction. In companies organized for the purpose of certain commercial and service activities, however, permission of the Higher Investment Board is required in order for foreign investment to exceed 49 percent. Transfers of shares representing in excess of 10 percent of the voting rights in such a company requires a separate approval. 

Share Companies

Share Companies may be established as either a joint stock company or a limited liability company.

 
Joint Stock Companies

Joint stock companies may be established with a minimum of seven shareholders. The minimum nominal value per share in a joint stock company is TD 5. The board of directors of a joint stock company is comprised between three to twelve directors. The directors appoint the chairman and general manager of the company. 
Joint stock companies are used primarily to conduct investment operations and activities. From the perspective of the availability of financing, banks prefer the financing arrangements available to joint stock companies.

While foreigners may serve as directors of joint stock companies without any limitation, officers of the company are subject to Tunisian labor law which gives preference to Tunisian nationals. Foreign ownership in businesses which engage in certain fields is restricted by decree to no more than 49 percent of the share capital unless special permission is obtained from the Higher Investment Board.
In existing companies, transfers of shares representing more than 10 percent of the voting rights require approval.

 
Limited Liability Companies

Limited liability companies may be established with a minimum of two shareholders. The shareholders appoint a manager who is endowed with all the powers of the company with regard to and toward third parties, even if the shareholders of the company have taken measures to limit the powers granted to the manager. For this reason, limited liability companies are used primarily for small projects and family businesses. All shares must be nominative and bearer shares are allowed only with the permission of the  
Ministry of Finance.

 
Foreign Companies

A foreign company may establish and register a branch in Tunisia by obtaining a Merchant Card from the Ministry of Trade. The process for obtaining a Merchant Card and registering in Tunisia is significantly easier for foreign companies which have engaged in a contractual relationship with a Tunisian company.

A copy of the contract with the Tunisian company, the incorporation documents of the foreign company and all records and board decisions of the foreign company relating to the creation of the foreign branch must be submitted along with the application for registration to the Ministry of Trade.

In 1996, legislation authorizing the creation of International Trade Companies (ITC) was adopted. An ITC is a non-resident company in which the share capital is held by Tunisian or non-Tunisian residents where at least 66 percent of such share capital is paid through convertible foreign currency, An ITC may engage wholly in export, and 80 percent of its turnover must originate from exportation.

 
Partnerships

Under Tunisian law, partnerships, or a company of persons, may be formed. The unlimited liability of the persons forming such a partnership or company of persons for its obligations is a deterrent to using this corporate form.

 
Commercial Agency

Foreign companies wishing to effect business in Tunisia without establishing a corporate entity in Tunisia must appoint a Tunisian citizen to act as their agent. Agency and representation activities are reserved to Tunisian citizens under the applicable law. An agent wishing to act for a foreign company must conclude a contract with the foreign principal and then apply to the Ministry of Trade for authorization. While the terms of an agency contract are freely negotiable, the contract may not provide for exclusivity.

Labor regulation in Tunisia

In Tunisia, the labor market is regulated by the 1966 Labor Code. It guarantees workers, both foreign and nationals, the same rights especially as concerns compensation, protection against discrimination, and the prevention of work-related accidents. The Code also includes provisions on professional training. The Labor Code is in conformity with the relevant international labor standards and international agreements.

 
Hiring Tunisian staff

Tunisia offers investors an educated workforce capable of being swiftly trained in new techniques and new skills. It has recourse to a large pool of young, highly-qualified new graduates whose skills and qualifications in various fields meet the needs of the business world.

Hiring Tunisians is free and competitive. To recruit staff, a foreign entrepreneur may resort to national support organizations such as The National Agency for Employment and Self Employment (ANETI), the National Bureau of Employment of Graduates and Executives (BNEC) or their regional offices, as well as private hiring consultancies.

 

Staffing Contract

Permanent contract (pc)

The PC is a common law contract. It is concluded either in writing or verbally for an indefinite term.
The probation or trial period for this type of contract is not obligatory, but varies depending upon the category of the employee as follows:

• 6 months renewable once for technicians/agents 
• 9 months renewable once for supervisors; and 
• one year renewable once for executives. 

Fixed-term contracts (ftc)

This type of contract is concluded for a maximum term of four years, including renewals. Employment beyond this period will be made permanent without a trial period.

Temporary work contract

Recruitment intermediation is a recognized and regulated activity.
This type of contract allows a company to contract employees legally without having to be their employer.

Part time contract (ctp)

PCs or FTCs also can be made part time however; the maximum effective working time for part time contracts may not exceed 70% of the normal working hours of the company.

 

Incentives for employing Tunisians

To encourage employment, the Tunisian authorities provide additional compensation for the benefit of employees and make subsidies available to employers.

Professional life initiation internship (SIVP)

A Professional Life Initiation Internship can benefit first-time job- seekers of Tunisian nationality who have had their higher education or equivalent diploma for at least 6 months.

The duration of the Professional Life Initiation Internship cannot exceed one year; however, the Minister of Employment may, in exceptional circumstances, extend the period for an additional 6 months within the same host company or authorize a second internship with another company. The overall duration of Professional Life Initiation Internship may in no case exceed 18 months.

Throughout the duration of the contract National Agency for Employment and Self Employment (ANETI) gives the trainee a monthly allowance of 150 TND.
A company cannot have new SIVP trainees unless it has already recruited at least 50% of all trainees who completed their internship during the last three years before filing a new application for inclusion in the program.

The benefit of this program is subject to prior registration of the beneficiary at the Office of Employment and Self Employment and to the signing of Professional Life Initiation Internship contract.

 

Hiring Foreign personnel

To pursue paid employment in Tunisia, all foreigners must possess an employment contract or a certificate of non-submission to a work contract delivered by the Ministry of Employment and a valid residence permit containing the designation "authorized for salaried employment in Tunisia."

Recruitment of foreigners may not be done when there are Tunisian nationals with the required specializations.

Employment contracts may be concluded for a period not exceeding one year, renewable once. All employment contracts may be renewed more than once if the foreigners are working for their own company in Tunisia and are engaged in development projects approved by the relevant authorities.

Employment contracts and renewals must be approved by the Ministry of Employment. The contract's form and the conditions of its grant and renewal are fixed by an order of the aforementioned Ministry.

Totally exporting businesses may recruit up to four foreign managers and supervisors for each business. Beyond this limit, businesses must comply with a recruitment program pre-approved by the Ministry of Employment.

Upon hire, a foreign worker is entitled to the following:

• the payment of a tax set at 20% of gross income; and
• exemption from customs duty and from taxes concerning the import of personal effects and the import of one automotive vehicle for each person.

 

Working Conditions (wages)

• The Guaranteed Inter-Professional Minimum Wage (sMIG): 289.639 tnD (40 working hours regime)
• The GuaranteedAgricultural Minimum Wage (sMAG): 13 tnD (hourly wage)

 
Social Security

Social Security Bodies in Tunisia

• The National Pension and Social Security Fund (CNRPS) responsible for providing coverage to civil servants and public sector employees. 
• The National Social Security Fund (CNSS), which provides social security for workers in the private sector (employees and self- employed workers in various sectors). 
• The National Health Insurance Fund (CNAM) manages the various schemes of health cover for social security affiliates in the public and private sectors, the provision of sickness benefits as well as compensation schemes for damages resulting from occupational accidents and diseases.

Source: Ministry of Social Affairs www.social.tn 

Health insurance

The health insurance plan has a compulsory core and optional
supplementary schemes. It is managed by the National Health Insurance Fund (CNAM).

Management is entrusted to the supplementary pension insurance companies and complementary health insurance schemes. The contribution rate is set at 6.75%:
• 2.75% paid by the employee;
• 4% paid by the employer.

 

Bilateral Social Security Agreements

Anxious to coordinate legislation with several countries for the benefit of their nationals who come to Tunisia, Tunisia has concluded bilateral agreements on social security with Belgium, France, The Netherlands, Luxembourg, Germany, Italy, Libya, Morocco, Austria, Egypt, Spain, Algeria, and Portugal. Tunisia also is party to a social security agreement concluded between the states of the Arab Maghreb Union in 1991.

Renowned for its multiculturalism, Tunisia is a country open to the world. Foreigners wishing to live in Tunisia without gainful employment, such as tourists, may stay in Tunisia for 3 months (90 days) or 4 months (120 days) without a permit.

Foreigners wishing to engage in gainful employment require a residence permit (visa and residence permit).

Algeria, Andorra, Antigua, Antilles (Netherlands), Argentinak, Austria, Bahrain, Barbados, Belgium, Bermuda, Bosnia and Herzegovina, Brazil, Brunei, Bulgaria, Canada, Chile, Croatia, Denmark, Dominica, Fiji, Finland, France, Gambia, Germany, Greece, Guinea, Honduras, Hong Kong, Hungary, Iceland, Ireland, Italy, Ivory Coast, Japan, Kiribati, Liechtenstein, Luxembourg, Libya, Macedonia, Malaysia, Maldives, Mali, Malta, Morocco, Niger, Mauritania, Mauritius, Monaco, Netherlands, Oman, Poland, Portugal, Qatar, Romania, Saint Kitts and Nevis, Saint Lucia, San Marino, Senegal, Serbia, Seychelles, Solomon, South Korea, Spain, United Arab Emirates,United Kingdom

A residence visa is required for all foreigners residing in Tunisia for more than 3 consecutive months or 6 non-consecutive months in one year.
Residence visas are divided into two categories:

Temporary residence visa

This visa is granted to foreigners who do not intend to set up permanent residence in Tunisia.

A temporary residence visa valid on a five-year renewable basis also can be granted to foreign investors who have been living in Tunisia for a year or less.

If the foreign national intends to work or begin a project in Tunisia, he/she must obtain authorization before obtaining his/her visa.

Permanent residence vsia

Permanent resident visas are given to foreigners who have been living in Tunisia on a temporary basis for five uninterrupted years and to foreigners with a Tunisian spouse and/or Tunisian children.

Residence permit

The residence permit is normally granted for a period of 2 years on a renewable basis, and must be renewed each time a work contract is renewed. Each renewal may be valid for up to 5 years. The residence permit is granted by the Directorate General of National Security in the Ministry of the Interior.

It includes the foreigner's complete identity, occupation, and place of residence. It is subject to the set stamp duty.