Trade Laws and Regulations in Syria: A Comprehensive Framework for Local and Foreign Investors

Syrian commercial law recognizes all common business entities typically found in Western countries, such as limited liability companies, partnerships, and joint-stock (shareholding) companies. Additionally, it allows for the establishment of joint ventures between the public and private sectors under the Syrian Investment Law.

In general, foreign companies and individuals are permitted to participate in all types of business entities pursuant to the new Investment Law of 2025, which allows foreign investors to own up to (100%) of their investments without the need for a local partner. The law offers significant incentives and tax exemptions, including guarantees against government interference, facilitation of foreign labor recruitment, and tax reductions that may reach (0%) for the industrial sector.

Targeted sectors:

Energy / Telecommunications / Aviation / Tourism / Healthcare / Agriculture / Industry.

Types of Companies Available to Foreign Investors in Syria

Foreign investors may establish several types of business entities, including:

1. Joint-stock companies (public or private):

Suitable for large-scale projects that require high capital and may include public share offerings. They provide a clear governance structure and allow participation by both local and foreign investors.

2. Limited Liability Companies (LLC):

Suitable for medium-sized projects, offering limited liability for each partner and flexibility in company management.

3. Partnerships (general or limited):

Appropriate for small and medium-sized projects, where investors can participate directly in management, with a minimum requirement of two partners.

4. Foreign entities under the Investment Law:

These include branches, temporary offices, representative offices, and regional offices. They are suitable for pilot investments or limited-scope operations without establishing a full company.

Basic Requirements for Companies:

1. Joint-Stock Companies
2. The legal framework is primarily based on Legislative Decree No. (2) of 2011 (Companies Law), which regulates various types of companies, along with subsequent amendments such as Law No. (18) of 2021 and Law No. (2) of 2023. A special regulation (Law No. (3) of 2024) applies to public joint-stock companies in which the state participates.
3. The company must be registered after the final declaration of its establishment and issuance of the incorporation decision by the competent authorities, and must obtain licenses from the Ministry of Industry or other relevant authorities depending on the activity. Industrial and commercial licenses are mandatory for any formal economic activity.
4. The minimum number of founders is three, with no maximum limit on the number of shareholders, which may reach thousands. The minimum capital is 100 million Syrian pounds (old) for a private joint-stock company, and 1 billion Syrian pounds (old) for a public joint-stock company or a holding company.

Companies with foreign participation require approvals and certifications from Syrian government authorities, most notably the Ministry of Economy and Foreign Trade and the Investment and International Cooperation Authority (especially if the company operates within investment zones). In addition, foreign documents must be legalized through Syrian embassies and the Syrian Ministry of Foreign Affairs, along with the submission of a feasibility study and obtaining security approval.

Share offerings must be announced through an official prospectus issued by the Syrian Commission on Financial Markets and Securities (SCFMS), detailing company and share information, and published in official newspapers and websites such as the Commission’s website and the Damascus Securities Exchange. A portion of annual profits must be allocated for distribution to shareholders, subject to the law and the company’s articles of association, with mandatory allocations for workers and employees under certain regulations. A legal reserve must be established before distributing remaining profits and determining management and board remuneration.

2. Limited Liability Companies (LLC)
3. These are similar to Western corporate structures, allowing separation between ownership and management. A manager or board of directors may be appointed, enabling partners to focus on investment while limiting their involvement in daily management.
4. The minimum capital requirement is 50 million Syrian pounds (old), and partners’ liability is limited to their shares in the capital.
5. The articles of association must be submitted with the application to the Ministry of Internal Trade to obtain preliminary approval and subsequent licenses, followed by registration in the commercial registry and the Chamber of Commerce.
6. Partnerships

These may involve persons or capital under Legislative Decree No. (29) of 2011, and include types such as general partnerships (joint and several liability), limited partnerships, joint ventures (undisclosed), and limited liability entities (which may be formed by a single person).

Investor Support and Tax Treaties

Foreign companies enjoy fundamental financial rights, including opening bank accounts, transferring profits and capital abroad, accessing local markets (shares and bonds), owning real estate for projects, and protection of property rights. Syria has also concluded Double Taxation Avoidance Agreements (DTAAs), particularly with Arab countries such as Jordan and Lebanon, to prevent double taxation on the same income.

Taxes on Land, Real Estate, and Foreign Companies

1. Real estate transfer tax imposed upon the sale or transfer of property ownership.
2. Value Added Tax (VAT) applied to new real estate upon first ownership transfer.
3. Annual taxes.

Management of Foreign Companies in Syria

Foreign companies are managed through registration with the Companies Directorate at the Ministry of Economy, after selecting the legal form, reserving the company name, preparing the articles of association, and providing the required documents, such as the parent company’s registration certificate and the board resolution to open a branch. Necessary licenses must be obtained, and compliance with Syrian law is required to enhance transparency and attract investment. Recently, responsibility for overseeing these companies has been transferred to the Companies Directorate to better organize operations.

How to Choose the Most Suitable Company Type for Your Project in Syria as a Foreign Investor?

1. This depends on the size of the project and its strategic objectives. For large and long-term projects, joint-stock companies are preferred, while limited liability companies (LLCs) and partnerships are suitable for smaller or more flexible projects. Branches or representative offices are ideal for testing the market or limited operations.
2. Foreign ownership may not exceed a certain percentage (sometimes 49%) in some sectors.
3. Real estate ownership by foreigners is generally limited to leasing rather than ownership, except in special cases authorized by decree.
4. Joint ventures usually require approval from the Syrian Investment Authority or the Supreme Investment Council, and some strategic sectors (such as banking, telecommunications, and insurance) are subject to stricter regulations.