Investing in Somalia: registration, tax, land, visas and permits

Where Xidig members may contribute

• Plain-language guides: members with legal, tax or accounting expertise can help keep a sourced, dated guide to registration and tax.
• Translation: Somali and English versions of official forms and guidance, reviewed by native speakers and professionals.
• Shared experience: members who have registered a business can report what the process involved, which helps others plan.

Possible services, research, supplier or collaboration roles

• Registration and compliance services by qualified professionals, done transparently.
• Tax training for small businesses on the 2025 income tax law.
• Research: a survey of how long registration, licensing and permits actually take.

Who may find this useful

• Diaspora members considering starting or investing in a business in Somalia.
• Accountants, lawyers and business advisers.
• Foreign companies considering a partnership.
• Students and researchers of Somalia's business environment.

Each rule, checked

The government's investment booklet sums up Somalia's rules for investors in one short table (p.9). Checked against current laws and official sources:

Registering a business.

• The online registry: the Ministry of Commerce and Industry launched the Somali Business Registration System in March 2022, at ebusiness.gov.so. The state broadcaster described it as "a web-based portal that offers a range of services, including reserving a business name, registering a new business, and changing the particulars of an existing business".
• The law: the Ministry's website links to a Company Law of 2019. The US State Department's 2025 investment report says: "In 2019, the FGS passed a law formalizing the legal requirements to create and register a company". It also says that, as of 2023, "deployment and adoption has been limited".
• Foreign ownership: SOMINVEST's registration page says foreign investors may "incorporate a sole director company and register a fully owned local company without a local shareholder". It lists annual licence fees for foreign companies, such as US$300 a year for import and export. The page is undated.
• Fast track: Xidig found no official description of the "fast-track services" the government's table mentions.

The investment laws.

• 2015 Foreign Investment Law. UNCTAD records its adoption in November 2015. The text UNCTAD hosts includes:
  • Equal treatment: foreign-invested enterprises "shall receive treatment as favorable as that accorded to domestic enterprises".
  • Profits: profits "may be freely transferred abroad in a freely convertible currency".
  • Capital: invested capital may be transferred abroad "after five years from the date of the registration", although the Board may shorten this period. The government's summary does not mention this condition.
  • Expropriation: allowed only where "public interest cannot be satisfied by other government measures", with "prompt and adequate compensation".
  • Disputes: may go to international arbitration (ICSID).
  • Local staff: at least 50% of staff must be local citizens.
  • Excluded sectors: mineral and petroleum extraction, military manufacturing and nuclear power are excluded from this law.
  • Approvals: a Foreign Investment Board approves foreign investments and issues a registration certificate; a Foreign Investment Promotion Office (the role SOMINVEST fills) implements its decisions.
  • The text UNCTAD hosts leaves the law number and date blank.
• 2023 protection law. UNCTAD records that in March 2023 "Parliament of Somalia approved the Investors and Investments Protection Law", covering national treatment, transfers, compensation for expropriation and arbitration.
• 2025 investment law. On 29 November 2025 the Upper House approved a new Somalia Investment Law (2025). According to SONNA and SOMINVEST, it establishes SOMINVEST as an agency under the planning ministry, creates a National Investment Council and provides for one-stop shops. SONNA reported that the bill "now awaits the Presidential signature to become effective", and SOMINVEST wrote at the time: "Once assent into law by … the President …". FTL Somalia likewise reported that, after the Lower House's earlier approval, the law "now awaits presidential signature to take effect".
• What is unclear: Xidig could not confirm whether the 2023 and 2025 texts are the same bill at different stages, whether and when the 2025 law was signed (a September 2026 news report says it was enacted in December 2025, but a planning ministry document dated 10 February 2026, seeking a consultant to draft the law's regulations, still refers to its "anticipated enactment"), or which parts of the 2015 law still apply.

Tax.

• A new income tax law in 2025. The IMF reports that "The new Income Tax Law was signed by the President on May 16th, 2025". According to the Ministry of Finance's manual, it replaced the 1966 Direct Taxation Law and took effect on 11 May 2025 (the date the manual gives).
• Company rates (Ministry of Finance Income Tax Manual, November 2025):
  • sales under US$10,000: a flat US$150;
  • sales between US$10,000 and US$50,000: 1.5%;
  • sales over US$50,000: 15%;
  • non-resident companies: 18% flat.
  • The manual says corporate tax is charged on taxable profit; Xidig could not confirm how the lower bands are calculated.
• Personal rates: 0% up to US$1,200 a year, then 6%, 12% and 18% above US$18,000. Non-residents pay 18% flat.
• Withholding taxes apply to dividends, service fees, royalties, rent and capital gains.
• Sales tax, not VAT: the state news agency announced that "Starting from August 18, 2024, businesses are required to add a 5% sales tax". Xidig found no VAT law.
• Out-of-date official pages: SOMINVEST's own tax page still cites the 1966 law and rates of up to 30%. The Ministry of Finance's manual gives the current rates.
• Tax exemptions: the US State Department reports that the director of revenue at the Ministry of Finance can grant tax exemptions. The government's fact sheets do not say which taxes their exemptions cover.

Land.

• Leasing, not owning: the US State Department says "Foreigners can lease land for commercial purposes but cannot formally own it" and that there are "no federal regulations governing land acquisition by foreign investors".
• Long leases: the 2015 law allows "long term leases for up to 99 years for substantial investment".
• Constitution: the 2012 Provisional Constitution says no permit may be granted for "the permanent use of any portion of the land", and that a federal law should regulate land-use permits. It also allows member states to make land policies. Xidig found no adopted national land policy. The constitution has since been amended; Xidig has not checked the amended text on this point.
• Local rules: some member states have their own urban land laws.

Visas and work permits.

• E-visa: since 1 September 2025 "all foreign nationals wishing to travel to Somalia are required to apply for their entry authorisation online, in advance of their journey" (Immigration and Citizenship Agency). Xidig could not open the e-visa portal to check fees, visa types or whether an invitation is needed.
• Work permits: the Foreign Employment Act (2015) requires permission from the Ministry of Labour and Social Affairs before a foreigner works, and restricts permits for jobs a citizen can do. The government services portal lists fees of US$320 for three months, US$490 for six months and US$780 for twelve months. Xidig found no official processing time.

Federal, member-state and regional systems.

• Parallel rules: Somaliland runs its own business registration and licensing system. Puntland was drafting its own investment and company laws in August 2026 (Dawan). When the federal sales tax began in 2024, Jubaland's finance ministry objected to it (Radio Dalsan).
• What this means: depending on where a project is, an investor may need approvals or licences from more than one authority. Xidig takes no position on these arrangements.

Financial integrity. An amended anti-money-laundering law (the AML/CFT Act) was enacted in May 2025 (IMF).

Dependencies and implementation constraints

• Laws in transition: the 2025 investment law and its regulations.
• Capacity: the State Department describes SOMINVEST's implementation capacity as limited.
• Different rules across member states.
• Out-of-date official web pages, which can give conflicting figures.

Risks and unknowns

• Relying on the government's summary: it is short and omits conditions such as the five-year rule on moving capital abroad.
• Legal uncertainty while the new investment law's status is unclear.
• Land disputes: land ownership and use can be contested, and disputes over land are common.
• Tax differences between federal and member-state authorities.

Questions members should verify before acting

1. Has the 2025 Somalia Investment Law been signed, and what does it change?
2. Which authority, federal or member-state, licenses your activity in your location?
3. What taxes and exemptions apply to your specific business?
4. What visa and work permit do you and your staff need, and how long does it take?
5. Who holds the land, and what lease terms and approvals are needed?

What is confirmed, and what isn't

Confirmed

• The 2025 income tax rates (Ministry of Finance manual).
• The 5% sales tax from August 2024.
• The online business registry since 2022.
• The e-visa requirement since September 2025, and published work-permit fees.
• The Upper House's approval of the 2025 investment law.

Our interpretation

• The government's table is broadly accurate but too short to rely on.

Not yet verified

• Presidential signature of the 2025 investment law.
• Current registration fees and fast-track services.
• E-visa fees, types and invitation rules.
• Work-permit processing times.

Relevant next steps

• Start with SOMINVEST and the Ministry of Commerce and Industry for registration.
• The Ministry of Finance's Income Tax Manual is the current official source on tax rates.
• Check member-state rules where the project is located.
• Get qualified legal and tax advice before investing.