Foreign Investment in Morocco: Legal Steps for Acquiring or Creating a Company

Estimated reading time: 14 minutes.

Foreign investment in Morocco: from market opportunity to legal execution

In cross-border transactions, the commercial agreement is rarely the most difficult part. The real work begins when the investor asks three practical questions: can we legally acquire the shares, how should the money enter Morocco, and will we be able to repatriate dividends or the sale proceeds later?

Recent transactions involving the reported entry of Finance Technology Fund into the capital of Expertise Data, as well as the association between DSV Group and ALF Holding, illustrate a broader trend: foreign funds and international groups are increasingly investing through Moroccan operating companies rather than limiting themselves to representative offices or commercial contracts. These transactions are illustrations of a tendency we observe closely in Moroccan corporate work, particularly in technology, logistics, industry and business services.

Morocco offers a generally open legal regime. In most sectors, a foreign investor may create a wholly owned subsidiary or acquire up to 100% of the capital of an existing Moroccan company. The key restrictions arise not from ordinary company law, but from regulated activities, sector-specific approvals, competition law, foreign-exchange traceability and, occasionally, rules governing agricultural land or regulated professions.

The figures confirm the country’s attractiveness, although statistics must be read carefully because gross foreign direct investment receipts, net flows and year-end positions are different indicators. The Office des Changes publishes the official monthly and annual data, which recorded substantial foreign investment flows in 2023 and subsequent years.

This article explains the legal path followed when a foreign fund or group enters the capital of a Moroccan business: preliminary due diligence, choice of corporate vehicle, negotiation of the share purchase or subscription documents, foreign-exchange compliance, tax structuring, corporate approvals and registration. It also corrects several persistent misconceptions about the Moroccan Investment Charter, the convertibility of the dirham and the minimum capital of a SARL.

1. The 2022 Investment Charter: Morocco’s renewed legislative foundation

1.1 Law-Framework No. 03-22 did not enter into force in January 2022

The principal legislative text is Law-Framework No. 03-22 forming the Investment Charter. For accuracy, it was promulgated by Dahir No. 1-22-76 of 14 Joumada I 1444, corresponding to 9 December 2022, and published in Official Bulletin No. 7151 bis of 12 December 2022. It should not be confused with a January 2022 text sometimes cited in non-official summaries.

The new Charter replaced the framework created by Law-Framework No. 18-95 of 8 November 1995. The change is more than cosmetic. The 1995 Charter was largely organised around tax and customs incentives. Law-Framework No. 03-22 places greater emphasis on employment, territorial balance, sustainable investment, local integration and targeted public support.

Core legal principle: the Charter is based on freedom of enterprise, fair competition, transparency and equal treatment of investors, subject to restrictions expressly imposed by sector-specific legislation.

The detailed state-support mechanism was implemented notably by Decree No. 2-23-1 of 17 January 2023. The system combines a principal investment-support mechanism with territorial and sectoral bonuses, alongside specific arrangements for strategic projects, very small, small and medium-sized enterprises, and Moroccan investment abroad.

Attention, however: the Charter does not create an automatic right to receive a subsidy merely because a foreign investor incorporates a company. Eligibility depends on the project’s investment amount, job creation, location, sector, local integration and other regulatory criteria. Applications are reviewed through the competent Regional Investment Centre and, depending on the project, by the regional or national investment bodies.

1.2 Equal treatment does not eliminate sector-specific restrictions

Moroccan company law does not impose a general Moroccan-shareholding requirement. A French, Spanish, Emirati, American or other foreign investor may therefore hold 100% of an ordinary Moroccan SARL or SA.

Exceptions remain. Banking, insurance, payment services, capital markets, audiovisual communication, private security, certain transport activities and regulated professions require licences or satisfy special ownership, qualification or governance conditions. A foreign investor must also examine the rules applicable to agricultural property. The acquisition of agricultural land by a company controlled by foreign interests cannot be treated like the acquisition of an urban office or industrial lot; the land’s legal classification and any non-agricultural use authorisation must be verified before signing.

This is why a serious foreign investment legal review in Morocco begins with the regulated status of the activity and the assets, not with the drafting of standard articles of association.

1.3 Governance of investment policy

Law-Framework No. 03-22 strengthened investment governance around the Head of Government, the National Investment Commission, ministerial departments and the Regional Investment Centres. The National Business Environment Committee, generally known by its French acronym CNEA, also contributes to business-law reform, but it was not originally created by Law-Framework No. 03-22; it predates the new Charter.

In practice, implementation texts have been adopted progressively. Some incentives, sectoral classifications and administrative practices may still evolve. Any investor preparing a 2026 application should therefore verify the version of the decrees, ministerial orders and CRI forms in force on the filing date rather than relying on a presentation prepared in 2023.

2. Choosing the investment structure: SARL, SA or branch?

2.1 The SARL with a non-resident shareholder

The SARL with a non-resident shareholder is the most common structure for a foreign-owned Moroccan subsidiary. It is governed by Law No. 5-96 on partnerships, limited partnerships, partnerships limited by shares, SARLs and joint ventures.

Contrary to a frequently repeated figure, a Moroccan SARL no longer has a statutory minimum capital of MAD 10,000. Under Article 46 of Law No. 5-96, the capital is freely determined by the shareholders. A nominal capital of MAD 10,000 remains common in practice, but it is a commercial choice, not the current legal minimum.

The SARL is attractive because its governance is relatively simple, its transfer restrictions can protect existing shareholders, and it does not require a statutory auditor from the first day in every case. A statutory auditor becomes compulsory where the statutory threshold is reached and may also be appointed voluntarily, required by the articles or ordered by the court under the conditions of Law No. 5-96.

For a technology investment such as the type illustrated by the Finance Technology Fund and Expertise Data transaction, an SARL is often retained where the shareholder base is limited. If several investment rounds are contemplated, however, an SA may offer more flexible governance and securities architecture.

2.2 The Moroccan SA with foreign capital

The société anonyme, or SA, is governed by Law No. 17-95. Under Article 6 of Law No. 17-95, its minimum share capital is MAD 300,000, increased to MAD 3 million where the company makes a public offering. The precise capital-markets terminology and obligations must also be checked against the legislation governing public offerings and the Moroccan Capital Market Authority, the AMMC.

An SA requires at least five shareholders under the ordinary regime. Its governance may follow a board of directors model or a management board and supervisory board model. A statutory auditor is compulsory from incorporation pursuant to Article 159 of Law No. 17-95.

The SA is generally preferable for institutional investors, complex shareholder arrangements, significant management participation plans or projects likely to involve debt securities, successive equity rounds or an eventual listing.

2.3 The foreign-company branch

A branch has no legal personality separate from its foreign parent. The parent company is directly responsible for the branch’s commitments, subject to the rules applicable to insolvency and cross-border enforcement. The branch must be registered with the territorially competent Commercial Register and comply with Moroccan accounting, tax and employment obligations.

For tax purposes, a branch will generally constitute a Moroccan permanent establishment. Its profits attributable to Moroccan activities are subject to corporate income tax under the General Tax Code and the applicable double-tax treaty. A branch may be appropriate for a defined contract or an initial market-entry phase, but it offers less liability separation than a subsidiary.

2.4 SARL, SA and branch compared

These figures are practical estimates, not regulated tariffs. Translation, apostille, legalisation, beneficial-ownership review, regulated-activity approval and negotiated shareholder documents can substantially increase the budget and timeline. For structural advice, an business lawyer in Casablanca should review the intended governance before capital is transferred.

3. Due diligence before a foreign investor enters the capital

3.1 Corporate and beneficial-ownership review

An acquisition should begin with a legal due diligence exercise. The investor should obtain a recent Commercial Register extract, updated articles of association, shareholder registers, minutes of shareholder and management meetings, evidence of capital contributions, beneficial-owner filings, licences and material contracts.

The review must confirm that the seller owns the shares free of pledges and that the contemplated transfer complies with approval clauses. In an SARL, transfers to third parties are subject to the approval mechanism laid down by Law No. 5-96. The articles may contain additional pre-emption, lock-up or tag-along rights, but they cannot validly disregard mandatory statutory rules.

3.2 Employment, tax, CNSS and litigation

Moroccan due diligence is not limited to company documents. The purchaser should reconcile the employee list with payroll records and declarations to the CNSS, examine employment contracts, accrued leave, dismissals and pending labour claims. Tax returns, assessments, VAT credits, withholding obligations and communications from the Direction Générale des Impôts must also be reviewed.

Litigation searches should cover the competent commercial court, court of appeal and, where relevant, published Court of Cassation decisions. Court searches are useful but not infallible: the target must contractually disclose ongoing proceedings, enforcement measures and arbitral disputes.

3.3 Real estate, permits and competition clearance

Where the target owns land, an original or recent land certificate from the Agence Nationale de la Conservation Foncière, du Cadastre et de la Cartographie is essential. A seller’s photocopy does not prove that no subsequent mortgage, attachment or registered right exists.

Large transactions may require notification to the Competition Council under Law No. 104-12 on freedom of prices and competition and its implementing legislation. The investor must test the current turnover thresholds and control criteria before completion. If clearance is mandatory, the share purchase agreement should contain a condition precedent and the parties should not implement control prematurely.

3.4 Transaction documents

The principal document may be a share purchase agreement, a capital-increase subscription agreement or both. A shareholders’ agreement commonly addresses governance, reserved matters, information rights, anti-dilution, transfer restrictions, exit rights, deadlock and dispute resolution.

Concretely, the closing checklist should link payment, foreign-exchange evidence, corporate approvals, signature of transfer instruments, amendment of the articles, management appointments, Commercial Register filings and beneficial-ownership updates. We systematically advise clients to avoid paying the full price before the conditions precedent and foreign-exchange route have been documented.

4. Foreign-exchange regulation and the role of the Office des Changes

4.1 What qualifies as foreign direct investment?

Morocco does not yet operate a fully convertible currency. Foreign-exchange transactions are governed by the legislation on foreign exchange and by the current General Instruction on Foreign Exchange Operations, known as the IGOC, issued by the Office des Changes.

The 10% threshold is commonly used for balance-of-payments statistics to distinguish direct investment from portfolio investment. It should not be misunderstood as a rule under which acquisitions below 10% escape foreign-exchange documentation. A non-resident acquisition of Moroccan shares still requires proper payment and traceability even where the percentage is lower.

The Office des Changes has moved substantially from prior authorisation towards delegated banking control and ex post supervision. Moroccan banks therefore play a central role: they verify the investment documents, the source and currency of funds, tax evidence and the investor’s right to transfer income or sale proceeds.

4.2 How the investment money should enter Morocco

To obtain the convertibility regime, the foreign investment should be financed in foreign currency, by debit to a convertible-dirham account, or through another method expressly accepted by the IGOC. The bank must be able to connect the incoming funds to the incorporation, capital increase or share acquisition.

A foreign account in convertible dirhams, often referred to in practice as a CEDC, may receive eligible foreign funds and facilitate local payments and subsequent transfers. It is an important tool, but it is misleading to say that every non-resident legal entity is universally required to use one. The suitable account depends on the transaction and the bank’s compliance analysis.

A European investor once arrived at a first meeting assuming that dividends could be transferred as easily as within the euro area. The surprise disappeared once the mechanism was explained: Morocco guarantees transferability for qualifying foreign investment, but the original investment must remain traceable. The bank receipt issued at entry may become decisive five or ten years later when the shares are sold.

4.3 Documents to retain

• SWIFT confirmation and bank credit advice showing the foreign-currency transfer;
• capital-blocking certificate where applicable;
• signed subscription, transfer or contribution documents;
• registered articles and shareholder resolutions;
• Commercial Register extract showing the completed transaction;
• tax registration and payment receipts;
• valuation documents for contributions in kind or related-party transfers.

Investors should maintain a permanent foreign-exchange file from day one. Reconstructing an investment trail years later is possible in some cases, but it is slow and may require special exchanges with the bank or Office des Changes.

4.4 Repatriating dividends and exit proceeds

The convertibility regime permits qualifying foreign investors to transfer investment income, including dividends, and proceeds from a sale or liquidation, after applicable taxes. The practical dividend file normally includes approved annual accounts, minutes of the ordinary shareholders’ meeting deciding the distribution, evidence of the beneficiary’s ownership, tax-withholding documentation and bank forms.

A universal “tax clearance certificate” is not automatically required in identical form for every dividend payment. Banks may request tax certificates or additional confirmation depending on the file, the transaction type and their compliance procedures. A well-prepared transfer commonly takes between 15 and 30 banking days, but a straightforward recurring dividend may be processed faster.

When shares are sold, the bank will compare the exit proceeds with the initial investment evidence and verify taxes due on the disposal. This is the practical heart of profit repatriation from Morocco to a foreign shareholder.

5. Creating a Moroccan company with a foreign shareholder

5.1 Documents required

For an individual foreign shareholder, the file normally includes a certified passport copy, address information and powers of attorney where an agent signs. A corporate shareholder must provide a recent registry extract or equivalent certificate, articles of association, board resolution approving the Moroccan investment, identity and authority of the signatory, and beneficial-ownership information.

Foreign public documents may require an apostille under the Hague Convention where applicable. Documents from other jurisdictions generally require diplomatic or consular legalisation. Documents not drafted in an accepted filing language should be translated by a sworn translator in Morocco.

One frequent delay is entirely avoidable: founders draft and sign the articles before confirming the company name. The negative certificate should be obtained through the official OMPIC or electronic business-creation channel first. The portal is commonly identified as DirectEntreprise; investors should beware of similarly named unofficial websites.

5.2 Articles, registered office and capital

An ordinary SARL may be incorporated by private deed; a notarial deed is not generally compulsory. A notary becomes particularly relevant for real-estate contributions, authenticated instruments or transactions where the parties want notarial security. Contributions in kind may require a contribution auditor subject to the exemptions and conditions provided by Law No. 5-96.

The company must have a valid registered office. Domiciliation is lawful under the Commercial Code, as amended by the legislation governing business domiciliation, but the agreement should satisfy statutory requirements and remain valid for registration and bank onboarding.

5.3 Commercial Register, tax and CNSS

After signature and completion of the capital formalities, the incorporation file is filed with the competent registry, generally through the integrated electronic platform where available. The company obtains its Commercial Register number, tax identifier and common company identifier, known as the ICE. Publication formalities must also be completed.

Commercial registry fees for a simple file are usually only a few hundred dirhams, but the total incorporation cost is higher once the negative certificate, legal announcements, certified copies, translation, domiciliation and professional fees are included. A realistic budget for a straightforward foreign-owned SARL is approximately MAD 3,000 to 8,000, excluding share capital and complex legal or tax structuring.

Once employees are recruited, the company must register with the CNSS and make payroll declarations. The five-year business-tax exemption for newly commenced professional activities arises under Article 6 of Law No. 47-06 on local authority taxation, subject to statutory exclusions; it should not be inaccurately presented as Article 6 of the General Tax Code.

5.4 The role of the Regional Investment Centre

The CRIs were reformed by Law No. 47-18. They assist investors, coordinate procedures and support applications for investment incentives and administrative authorisations. They are invaluable, but investors should not assume that every company must legally be incorporated within ten days. Processing time depends on the completeness of the file, the registry, bank onboarding and sector-specific approvals.

A complete standard SARL file can often be finalised in 7 to 15 working days. Apostille, translation and foreign beneficial-ownership checks are frequently the real bottlenecks. Further procedural detail is available in this company creation in Morocco resource, while negotiated structures should be reviewed by a corporate lawyer in Rabat or counsel in the relevant region.

6. Taxation of a foreign-owned company in Morocco

6.1 Corporate income tax

A Moroccan subsidiary is a Moroccan tax resident regardless of the nationality of its shareholders. It is subject to corporate income tax under Article 19 of the General Tax Code, VAT, withholding obligations and applicable local taxes.

The Finance Law for 2023 introduced a progressive transition over the 2023–2026 period. From 2026, the standard corporate income tax architecture generally applies a 20% rate where taxable net profit is below MAD 100 million and 35% where taxable net profit is at least MAD 100 million, with a 40% rate for certain credit institutions and similar regulated entities. Specific activities and incentive regimes must be checked separately.

6.2 Dividends paid abroad

The domestic withholding tax on income from shares and similar participation income was progressively reduced under the Finance Law reform. For distributions made from 1 January 2026, the ordinary rate is generally 10% under the transitional schedule reflected in Article 19-IV of the General Tax Code, rather than the historical 15% figure still found in older articles.

A tax treaty may reduce the rate where the foreign shareholder is the beneficial owner, satisfies the participation conditions and provides a valid tax-residence certificate. Treaty relief is not automatic merely because the holding company is incorporated in a treaty jurisdiction. Moroccan tax authorities may examine beneficial ownership, substance and anti-abuse rules.

6.3 Tax treaties, permanent establishment and transfer pricing

Morocco has an extensive network of double-tax treaties, including agreements with France, Spain, Germany, the Netherlands and the United Arab Emirates. The treaty with France was signed on 29 May 1970 and has been amended by subsequent instruments.

Suppose a French parent receives dividends from its Moroccan subsidiary. Moroccan withholding is applied subject to the treaty rate and documentary conditions, while France generally grants the treatment available under French law and the treaty. The final result depends on the parent’s status, ownership percentage and applicable participation-exemption rules.

Intra-group services, management fees, loans and intellectual-property royalties must comply with the arm’s-length principle. Documentation obligations become especially significant for multinational groups. A foreign holding company can lawfully own the Moroccan subsidiary, but a shell inserted only to obtain treaty benefits may face anti-abuse challenges.

The place of effective management also matters. A foreign company whose strategic decisions are effectively made from Morocco may create Moroccan tax-residence or permanent-establishment exposure. A tax lawyer in Casablanca should review the holding jurisdiction before, not after, the acquisition.

6.4 VAT, industrial zones and Casablanca Finance City

The ordinary VAT rate is 20% under Article 99 of the General Tax Code, subject to reduced rates and exemptions. Newly incorporated businesses must examine invoicing, deduction rights and VAT reporting from the first transaction.

Industrial Acceleration Zones, formerly known as free zones, and the Casablanca Finance City regime continue to offer operational and tax advantages, but older references to a universal five-year exemption followed by a permanent 15% rate are no longer reliable for every company. Tax reforms have progressively aligned several preferential regimes with the national corporate-tax system. Eligibility, commencement date, export status and transitional rules must be checked under the current General Tax Code, Law No. 19-94 and the CFC legislation.

7. Guarantees protecting foreign investors

7.1 Property and protection against expropriation

Article 35 of the 2011 Constitution guarantees the right to property and freedom of enterprise. Expropriation is permitted only in the cases and according to the procedures established by law. Expropriation for public purpose is principally governed by Law No. 7-81, which provides judicial procedures and compensation mechanisms.

“The right to property is guaranteed. The law may limit its scope and exercise if the requirements of the economic and social development of the country so require. Expropriation may be carried out only in the cases and according to the procedures provided by law.” — Article 35 of the Constitution.

Law-Framework No. 03-22 adds investment-related guarantees, while applicable bilateral investment treaties may protect against unlawful or discriminatory expropriation and require compensation according to their wording.

7.2 Bilateral investment treaties

Morocco has signed a broad network of bilateral investment treaties. Before a Gulf investment fund enters a Moroccan target, its counsel will often check which treaty protects the actual investing entity, whether the treaty is in force and whether restructuring before a dispute is permissible. This is not academic. It can influence the location of the holding company, the definition of protected investment and access to arbitration.

Treaty counting must nevertheless be precise: the number signed is not the number currently in force. The UNCTAD treaty database should be consulted for each instrument’s status, dates and text.

7.3 ICSID and arbitration

Morocco signed the Washington Convention establishing the International Centre for Settlement of Investment Disputes in 1965, and it entered into force for Morocco in 1967. This does not mean that every dispute with a Moroccan public authority automatically falls within ICSID jurisdiction. The investor must establish valid consent, usually through a treaty, legislation or an investment agreement.

Commercial disputes between private parties may be submitted to arbitration under Moroccan Law No. 95-17 on arbitration and conventional mediation, provided the clause is properly drafted. Parties contemplating cross-border enforcement should define the seat, institution, language, governing law and scope of the clause. An international commercial arbitration lawyer in Morocco can assess whether a domestic court clause, institutional arbitration or a combined mechanism is appropriate.

7.4 Investment agreements with the State

Major or strategic projects may be covered by an investment agreement with the Moroccan State. The agreement can define public support, implementation milestones, employment commitments, land arrangements, training measures and monitoring obligations.

There is no safe universal rule that every project exceeding MAD 100 million or creating 50 jobs automatically receives such an agreement. Under the new Charter, eligibility depends on the relevant support mechanism and implementing regulations. For example, combinations of investment amount and stable job creation are used in the principal support mechanism, while strategic projects follow a distinct route. The CRI should confirm the current thresholds before the investor builds them into its financial model.

8. Foreign managers, post-closing compliance and recurring mistakes

8.1 Can a foreign national manage the company?

Yes. A foreign natural person may manage an SARL; Article 62 of Law No. 5-96 provides that the SARL is managed by one or more natural persons, who may be shareholders or third parties. Moroccan nationality is not a general requirement.

Immigration and employment rules are separate. A manager who resides in Morocco must obtain the appropriate residence documentation. If the relationship is an employment relationship, Article 516 of the Labour Code requires the foreign employee’s employment contract to receive the labour authority’s visa, with ANAPEC documentation or an applicable exemption.

Not every unpaid corporate officer is automatically an employee. The correct analysis depends on remuneration, subordination and actual duties. It is therefore too broad to claim that every foreign director requires an ANAPEC work authorisation merely because they sign board resolutions. Advice on foreign-national and investment law in Morocco is recommended where the manager will work and reside locally.

8.2 Registration and foreign-exchange updates after closing

After an acquisition or capital increase, the parties must complete the tax registration, corporate approvals, amended articles where required, Commercial Register filing, legal publication and beneficial-owner update. The bank should receive the final documents so that its foreign-exchange records match the completed investment.

Deadlines vary according to the instrument and transaction. Investors should not rely on a supposed universal 20-day Office des Changes declaration period without checking the current IGOC. Many eligible operations are handled through the authorised bank under delegated rules rather than by a direct filing from the investor.

8.3 Four mistakes that cause disproportionate trouble

1. Paying from an undocumented account. The investor later discovers that the bank cannot establish foreign-currency financing.
2. Using generic articles of association. They conflict with the shareholders’ agreement or omit reserved matters and exit rules.
3. Ignoring tax and CNSS liabilities. An equity purchaser acquires the company with its historical exposure.
4. Appointing a resident foreign manager without immigration analysis. Corporate authority, residence status and employment status are separate questions and must all be regularised.

Conclusion: a mature framework, provided the transaction is documented correctly

Moroccan law is broadly favourable to foreign investment. In most unregulated sectors, a non-resident fund or group may own 100% of a Moroccan SARL or SA. The 2022 Investment Charter, its 2023 implementing measures and the corporate-tax transition completed in 2026 have made the framework more structured, though not entirely automatic.

Five actions should guide the investor. First, verify sectoral restrictions and competition-clearance requirements. Second, perform legal, tax, employment, CNSS and property due diligence. Third, choose between an SARL, SA and branch on governance rather than incorporation cost alone. Fourth, route the investment through a bank in strict compliance with the IGOC and retain every traceability document. Finally, coordinate closing, corporate registration, tax and beneficial-ownership filings.

The Finance Technology Fund–Expertise Data and DSV Group–ALF Holding operations are useful illustrations of a market in which international capital and Moroccan businesses increasingly meet through structured transactions. The legal framework is operational; execution quality makes the difference.

Depending on the project’s location, investors may consult a business lawyer in Casablanca, a business lawyer in Marrakech or a business lawyer in Tangier, particularly for industrial projects and investments in northern Industrial Acceleration Zones.