Exchange

There is no stock exchange in Burundi and capital is raised mainly from commercial banks.

Current number of listed companies

n/a

Listing rules

n/a

Regulatory body or bodies

n/a

Principal legislation

n/a

Corporate Governance Code

Law No. 1/09 of May 11th 2011, relating to commercial companies.

The Companies Act

Takeover / merger regulations

A few provisions onTakeover/Merger Regulations are contained in the Companies Act.

The Companies Act

Burundi is also a Member State of COMESA and therefore subject to the COMESA Competition Regulations. Please see the COMESA summary in the AG section of the app to be found under the AG in Africa page.

Public offers / disclosure regulations

n/a

Legislation

Law 1/06 of 25 March 2010 provides the legal regime for Competition

Law 1/01 of 16 January 2015 provides the legislation for the Commercial Code

Please see the COMESA Competition Regulations summary in the AG section of the app to be found under the AG in Africa page.

Impact of regulatory regime on business

The Government is yet to issue a decree of implementation for the legislation, and as such, the legal regime for Competition is yet to come into force.

Scope

The law covers various aspects of competition. It provides for institutional aspects (institution of a Competition Authority and sharing of powers with the Ministry of Trade), and amongst other things, regulations relating to unfair competition, abuse of dominant position, mergers and acquisitions, and limitations to economic concentrations.

Corruption Perception Index rank worldwide for 2017:

157 

Corruption Perception Index score for 2017:

22

Signatories to United Nations Convention Against Corruption (UNCAC)?

No

(UNCAC) ratified?

No,  but have acceded.

Find out more here

Ratified?

Yes

Signatories to the African Union Convention on Preventing and Combating Corruption?

Yes

Signatories to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions?

No

Arbitration

Burundi's domestic arbitration is governed by Law No. 5 bis/2004 of 13 May 2004 on Civil Procedure Code (Title VIII: Arbitration) and Rules of Arbitration and Conciliation settled by the Burundian Centre of Arbitration and Conciliation (Centre Burundais d'Arbitrage et de Conciliation/CEBAC/2006).

Arbitration may be ad hoc or institutional.

Ad hoc arbitration is organised by the parties themselves in the arbitration agreement and according to the agreed rules of procedure. To this end, the parties may agree on a law, even foreign law, which will apply. Ad hoc arbitration is composed of either a single arbitrator or three arbitrators.

Institutional arbitration is when the parties have entrusted the organisation of the arbitration to a permanent arbitral institution and judge according to their own rules.

In all cases, the arbitrator is not the agent of the parties. It accomplishes its mission independently.

There is one principal arbitration body in Burundi with their own set of arbitral rules: the Burundian Centre of Arbitration and Conciliation (Centre Burundais d'Arbitrage et de Conciliation/CEBAC/2006).

Enforcement of foreign judgments

Article 365 of the Civil Procedure Code provides that the President of the Court of Appeal is responsible for the enforcement in Burundi of pecuniary obligations relating to a sentence/order from a foreign court, provided that sentence is regularly rendered in a foreign State in accordance with the laws of that State.

Article 26 of the Code on Judicial Competence and Organisation also states that decisions by foreign courts in private matters shall be rendered enforceable in Burundi by the high courts, if they meet the following conditions:

• that the decision contains nothing contrary to public order in Burundi;
• the decision is cast in res judicata;
• that under the same law, the copy that is produced meets the conditions necessary to establish its authenticity;
• that the rights of defense have been respected; and
• that the foreign court is not competent only because of the applicant's nationality.

Judiciary

The Judiciary power is constitutional. The organisation and jurisdiction of courts are determined by an organic law.

Justice is administered by courts and tribunals throughout the territory of the Republic on behalf of the people of Burundi.

The judiciary is impartial and independent of the legislature and the executive. In exercising its functions, the judge is subject only to the Constitution and the law.

The President of the Republic, Head of State is the guarantor of the independence of the Judiciary. He is assisted in this task by the Superior Council of Magistracy.

In relation to the business environment, many legal and administrative reforms have been undertaken, but there is a need to invest in the training of different categories of the professionals involved including judiciary practitioners (judges, lawyers), to guarantee suitable administration of the reforms.

Effectiveness of the court system

The court agenda is, most of the time, overcrowded. Court proceedings are generally very long, and a trial can easily last more than twelve months. The enforcement of judicial decisions is a key challenge as it is a process cluttered with administrative heaviness.

Structure of the court system

The judiciary has ordinary courts and specialised courts.

In ascending order, the courts are:

• Courts of Residence (Tribunaux de residence)
• County Courts (Tribunaux de Grande Instance) (primary courts);
• Court of Appeal
• Supreme Court

The Constitutional Court is the supreme authority of Burundi's constitutional law and deals with the interpretation of the Constitution of 2005.

There are also specialised courts, as follows:

• Labour Courts
• Commercial Courts
• Administrative Courts
• Anti-Corruption Court
• Martial Court

The County Courts are established at each provincial level (one in every province). Courts of Residence are established in every commune.

The Code of Civil Procedure (Code) regulates the enforcement of arbitral awards.

Article 365 of the Code specifies that failure to perform the arbitral award amicably, will, at the request of the most diligent party, lead to it being enforced by order of the President of the Court of Appeal of the place of execution.
It also provides that the President of the Court of Appeal is responsible for the enforcement in Burundi of pecuniary obligations relating to a sentence/order from a foreign court, provided that that sentence is regularly rendered in a foreign State in accordance with the laws of that State.

Articles 366 to 369 of the Code provide respectively that:

• The ordinance authorising the execution is not subject to appeal;
• The president or his delegate who made the order is competent to hear issues related to implementation difficulties;
• Arbitral awards cannot be opposed by third parties; and
• Any dispute which may arise between the parties regarding the meaning or scope of the arbitration award may be resolved by making a request for interpretation submitted in writing to an ad hoc arbitration.

Foreign Investment Incentives

The Investment Code ensures complete freedom of investment in the sense of non-discrimination and equal treatment of all non-resident persons and legal entities entering into investments with Burundian individuals and legal entities.

The law guarantees the following:

• Freedom of establishment and capital investment for every person or entity wishing to settle on Burundian territory as an enterprise
• Granting of visas and free residence-fixation and moving required for expatriate's investments, in compliance with laws and regulations on immigration
• Recognition and guarantee of the right of ownership to any person or entity, without any discrimination
• Secured transfer of invested capital and income from it if it was done through foreign exchange inflows (including the free transfer of capital and foreign income after payment of taxes and taxes payable, in the currency and to the country of the investor's choice; transfer of unused earned income by foreign employees of any investment; and the transfer of return on capital as dividends in full, for the foreign-funded enterprises, and in proportion to the capital for companies with mixed capital)
• The non-nationalisation and expropriation by the Government of Burundi of investments in its territory
• Arbitration in case of a dispute over the investment, should the investor wishes so

Broadcasting

Decision (Order) No 100/CNC/04/04 of 25 October 2004, laying specifications and missions of private broadcasting, TV and radio.

Press

Law No. 1/25 of 27 November 2003, regulating press in Burundi.

Telecommunication

The following telecommunications laws apply:

• Decree No.100/14 of 22 January 2013 providing the framework of control, minimal thresholds and taxation of call terminations for international incoming communications;
• Decree No.100/153 of 17 June 2013 setting up a control system and taxation of international incoming calls;
• Decree Law No. 1/11 of 04 September 1997 lays the organic framework on telecommunications;
• Decree No. 100/182 of 30 September 1997 establishing the Agency for Regulation and Control of Telecommunications;
• Ministerial Ordinance No.540/877 of 24 June 2013 for implementation of Decree No.100/153 of 17 June 2013; and
• Law No. 1/18 of 25 September 2007 establishes the mandate, composition and functioning of the National Council of Communication.

Real property tax

Full payment of taxes apply to the owner.

The Authority does not intervene to make any allocation of tax between landlords and tenants.

The tax on the size of buildings is calculated per square meter of surface area and the nature of the construction.The property tax on undeveloped land shall be:

• 2F/m2 for areas with minimal equipment
• 3F/m2 moderately equipped areas
• 4F/m2 for areas highly equipped

The tax rate on profit sub-lease income and rental of buildings and land shall be:

• 20% for income up to 200,000 BIF
• 25% for income between 200,001 to 400,000 BIF
• 30% for income between 400,001 to 700,000 BIF
• 35% for income between 700,001 to 1,000,000 BIF
• 40% for income between 1,000,001 to 1,300,000 BIF
• 45% for income between 1,300,001 to 1,800,000 BIF
• 50% for income between 1,800,001 to 3,800,000 BIF
• 60% for income over 3,800,000 BIF

Value added tax

Standard rate = 18%
Imported foodstuffs, processed agricultural products and agricultural inputs (fertilisers)= 10%
Exports = 0%

Payroll tax and social security

Where an employer pays an employee, the employer must withhold, declare, and pay the PAYE tax to the Burundi Revenue Authority within 15 days from the end of the month for which the tax was due. The employer is personally liable for doing so correctly.

The contributions to the social security fund is 10%, being made up of 6% from the employer and 4% from the employee, capped at BIP450,000 per month.

Applicable as follows:

• 40,000 BIF = 0%
• 40,001 BIF to 48, 350 BIF = 27%
• 48,351 BIF to 56,650 BIF= 31%
• 56,651 BIF to 65,000 BIF = 35%
• 65,001 BIF to 73,350 BIF = 40%
• 73,351BIF to 81,650 BIF = 41%
• 81,651BIF to 164,950 BIF = 43%
• 164,951 BIF to 248,250 BIF = 47%
• 248,251 BIF to 331,550 BIF = 55%

Technical service fees

15%

Interest

Withholding tax at 15% is payable regardless of the fact that the beneficiary is resident or not, but taxed as normal earnings of resident company.

Exchange control

Under administrative guidelines of the Central Bank of Burundi

Transfer pricing

The tax authorities are allowed to adjust taxable income to reflect the arm's length price if a related party transaction differs from what would have been agreed between unrelated parties, and thereby leads to a reduction

Royalties

Taxed as witholding tax at 15% for residents and non residents

Stamp duty

n/a

Capital gains tax

Taxed at a rate of 30% (taxed as ordinary profit), Non-residents at 30%

Corporation Tax

Corporations are taxed at a single rate of 35%.

Export Processing Zone

No particular rules. However, there is an ongoing project for setting up an EPC near the Democratic Republic of Congo border.

Dividends

15% for individuals and non-resident entities – they are exempted from tax if they are paid and received by a resident company, but taxed as normal earnings of a company (at 30%) in other cases.

Thin cap regulations

No particular rules