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Guide to Opening a Company in Zambia
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Guide to Opening a Company in Zambia

January 1, 2026•5 min read

Starting a business in Zambia can be an exciting venture, offering opportunities in sectors like mining, agriculture, tourism, and manufacturing. The process is regulated primarily by the Patents and Companies Registration Agency (PACRA), which oversees the registration of business names and companies. Whether you're a local entrepreneur or a foreign investor, understanding the types of entities available and the registration steps is crucial. This article outlines the different business entities you can establish in Zambia and provides a step-by-step guide to getting your company up and running.

Types of Business Entities in Zambia

Zambia offers several business structures to suit different needs, from simple sole proprietorships to more complex corporate entities. The main types handled by PACRA include business names and companies. Other structures like cooperatives may require registration with different authorities, such as the Ministry of Commerce, Trade, and Industry. Here's a breakdown of the key entities:

1. Business Name (Sole Proprietorship or Partnership)

  • Description: This is the simplest form for individuals or groups starting a business. A business name is an unincorporated entity with no separate legal personality, meaning the owners have unlimited personal liability for debts. It's ideal for small-scale operations like retail shops or freelance services. It can be registered as a sole proprietorship (one owner) or a partnership (multiple owners).

  • Key Features: No minimum capital requirement; easy to set up; owners report profits on personal taxes.

  • Suitability: Best for low-risk, small businesses where owners want minimal formalities.

2. Private Company Limited by Shares

  • Description: The most common type for small to medium enterprises. Shareholders' liability is limited to their investment in shares. It must have at least two directors, with at least half residing in Zambia.

  • Key Features: Minimum nominal capital of K20,000; cannot offer shares to the public; perpetual succession (continues even if owners change).

  • Suitability: Ideal for family businesses or startups seeking limited liability without public trading.

3. Public Company Limited by Shares

  • Description: Similar to a private company but can invite the public to subscribe for shares, often listed on stock exchanges like the Lusaka Securities Exchange. Requires at least two directors, with residency rules applying.

  • Key Features: Higher regulatory requirements, including audited financial statements; suitable for raising capital from investors.

  • Suitability: For larger businesses aiming for growth through public investment.

4. Unlimited Company

  • Description: Shareholders have unlimited liability, but the company is a separate legal entity. Rare in practice due to the risk.

  • Key Features: No limit on liability; still offers perpetual succession.

  • Suitability: Uncommon, but used in specific scenarios like professional firms.

5. Company Limited by Guarantee

  • Description: No share capital; members guarantee a fixed amount in case of winding up. Often used for non-profits, charities, or associations.

  • Key Features: Members' liability limited to the guarantee amount; can apply to omit "Limited" from the name if non-profit.

  • Suitability: Non-commercial entities focused on social or community goals.

6. Foreign Company (Branch or Representative Office)

  • Description: For foreign entities establishing a presence in Zambia without forming a new local company. It's essentially a branch of the parent company abroad.

  • Key Features: The parent company bears liability; must comply with Zambian laws.

  • Suitability: Multinationals testing the market or conducting limited activities.

Other entities like cooperatives (for member-owned businesses in agriculture or finance) are registered separately under the Cooperatives Societies Act, not through PACRA.

Step-by-Step Guide to Registering a Company in Zambia

The registration process is straightforward and can be done online via the PACRA Portal, ZamPortal, or in person at PACRA offices. It typically takes 1-3 weeks, depending on the entity type. Here's the general process:

  1. Decide on Your Business Structure: Choose between a business name or a company based on liability, size, and goals. For companies, select the specific type (e.g., private limited).

  2. Name Clearance and Reservation: Submit three proposed names using Companies Form 1 (or equivalent for business names). Names must comply with PACRA guidelines—no misleading, offensive, or government-implying terms. Approval is valid for 30 days; reserve for up to 90 days if needed using Form 2.

  3. Prepare Documents:

    • For Business Names: Completed Business Name Form III.

    • For Local Companies: Companies Form 3, Articles of Association (4 copies for share-based companies), declarations of consent for directors/secretaries.

    • For Foreign Companies: Companies Form 38, plus parent company documents.

  4. Submit Application: File online via PACRA Portal or ZamPortal, or at a PACRA office. Include proof of identity (NRC or passport) and address.

  5. Pay Fees: See the fees section below. Payments can be made online or at designated banks.

  6. Receive Certificates: Upon approval, you'll get a Certificate of Incorporation (for companies) or Registration (for business names), plus other documents like a share capital certificate.

  7. Post-Registration Steps: Obtain a Taxpayer Identification Number (TPIN) from the Zambia Revenue Authority (ZRA), open a business bank account, and register for any sector-specific licenses (e.g., from the Zambia Development Agency for investments over USD 500,000).

For foreigners, additional approvals may be needed from the Zambia Development Agency if investing significantly.

Requirements and Documents

  • Eligibility: Applicants must be over 18, of sound mind, and not undischarged bankrupts.

  • Directors/Shareholders: For companies, at least two directors (half Zambian residents for share-based types).

  • Documents: ID copies, application forms, Articles of Association, and proof of address. Foreigners need passports and work permits if residing in Zambia.

  • Minimum Capital: K20,000 for share-based companies.

Fees

Fees are in Zambian Kwacha (K) and subject to change; check PACRA for updates.

  • Name Clearance (Form 1): K120

  • Name Reservation (Form 2): K213.33

  • Business Name Registration: K222.40

  • Local Company Incorporation (Share-Based): 2.5% of nominal capital (min K500) + K200 each for certificates and declarations (total min K1,300)

  • Company Limited by Guarantee: K1,266.67

  • Foreign Company Registration: Around K266.67 (name clearance higher)

  • Change of Name (Form 4): K400

Online submissions may incur additional portal fees.

Tips and Considerations

  • Online vs. In-Person: Use the PACRA or ZamPortal for faster processing and to avoid travel.

  • Legal Advice: Consult a lawyer or consultant for complex setups, especially for foreign investors.

  • Compliance: After registration, file annual returns and maintain records to avoid penalties.

  • Incentives: Large investments may qualify for tax breaks via the Zambia Development Agency.

  • Challenges: Be prepared for bureaucratic delays; ensure names are unique to avoid rejections.

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