(Feb. 2, 2017) On December 17, 2016, legislative amendments on re-domiciliation of foreign companies to Armenia came into effect. (Law No. 207-N of Nov. 17, 2016, OFFICIAL GAZETTE, No. 88 (Dec. 7, 2016), Armenian Legal Information System (ARLIS) database (in Armenian).) The amendments affected both the Civil Code and the Law on Registration of Legal Entities, Separated Subdivisions of Legal Entities, Institutions, and Individual Entrepreneurs. (Civil Code, Law No. 239 of May 5, 1998, OFFICIAL GAZETTE No. 17 (Aug. 10, 1998), ARLIS; Law on Registration of Legal Entities, Separated Subdivisions of Legal Entities, Institutions, and Individual Entrepreneurs, Law No. 169 of Apr. 3, 2001, OFFICIAL GAZETTE No. 14 (May 18, 2001), ARLIS (both in Armenian and Russian).) Re-domiciliation is defined by the Civil Code as the relocation of a legal entity from one jurisdiction to another, which results in the change of the entity’s personal law. (Civil Code, art. 59.1.)
According to the amendments, a foreign company interested in moving its offices to Armenia must first apply for a preliminary registration of re-domiciliation and a certificate of continuity “ (proof that the company can continue its existence in the new jurisdiction) and pay a state duty of 10,000 drams (about US$21). The final registration of re-domiciliation in Armenia takes place after the foreign company’s dissolution or relocation is registered in its original jurisdiction. (Law on Registration of Legal Entities, Separated Subdivisions of Legal Entities, Institutions and Individual Entrepreneurs, Art. 36.1, as amended by Law No. 207-N.)
The new regime allows foreign companies to move their offices to Armenia without having to go through liquidation proceedings or sell their assets. The government is allowed under the law to establish a list of countries from which legal entities are not allowed to move their domiciles to Armenia. (Civil Code, art. 59.2, as amended by Law No. 207-N.)
Re-domiciliation to Armenia is available to both for-profit and non-profit foreign companies, but not to political parties, religious bodies, and some other specified organizations. In addition, re-domiciliation is not available to financial institutions that are subject to licensing by the Central Bank. Re-domiciliation of Armenian companies to foreign countries is similarly allowed under the new legal provisions. (Id. art. 59.3.)
According to the Minister of Economic Development and Investments, Suren Karayan, the amendments are designed to attract foreign investors. He added that similar reforms in Austria, Belgium, Ireland, and Latvia have proved to be effective. (Armenian Parliament Amends Redomiciliation Bill, ARKA.AM (Nov. 17, 2016).)
Prepared by Nerses Isajanyan, Foreign Law Consultant, under the supervision of Peter Roudik, Director of Legal Research.