Foreign Investment in Algeria

296 Pages·2012·0.94 MB·English

© 2012 KPMG Algérie SPA, Algerian member firm of the KPMG network of independent members firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Printed in Algeria.
Guide to Investing
in Algeria
(Updated on August 2012)
Dépôt légal : 4460-2012
ISBN : 978-9947-807-19-4
© 2012 KPMG Algérie SPA, Algerian member firm of the KPMG network of independent members firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Printed in Algeria.
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
SOMMAIRE
Chapter 1
General Introduction to Algeria .................................................................................................................................................................................................................13
1.1 History and Geography .........................................................................................................................................................................................................................................13
1.2 Population Demographics ................................................................................................................................................................................................................................14
1.3 Main cities - Languages - Religions ..........................................................................................................................................................................................................14
1.4 Territorial and administrative organization – Political institutions ........................................................................................................................15
1.5 Political parties Associations .........................................................................................................................................................................................................................16
1.6 Judicial system .............................................................................................................................................................................................................................................................17
1.7 Staying in Algeria: conditions – procedures – work permit ...........................................................................................................................................17
1.8 Practical information ................................................................................................................................................................................................................................................18
1.9 Economy: key figures ...............................................................................................................................................................................................................................................19
1.10 Economic policy: development and trend ........................................................................................................................................................................................27
1.11 Economic development outlook 2010–2014 ...................................................................................................................................................................................40
1.12 The legal environment for business........................................................................................................................................................................................................42
Chapter 2
Foreign Investment in Algeria .......................................................................................................................................................................................................................44
2.1 Legal framework ........................................................................................................................................................................................................................................................44
2.1.1 General definition of investment ...............................................................................................................................................................................................................44
2.1.2 Freedom to invest and Algerian partnerships ...............................................................................................................................................................................44
2.1.2.1 Freedom to invest ......................................................................................................................................................................................................................................................44
2.1.2.2 Partnership ........................................................................................................................................................................................................................................................................45
2.1.2.3 State first refusal right ..........................................................................................................................................................................................................................................46
2.1.3 Guarantees - Protections - Agreements concluded by Algeria ....................................................................................................................................48
2.1.4 Capital transfers in Algeria ..............................................................................................................................................................................................................................50
2.1.4.1 The principle ....................................................................................................................................................................................................................................................................50
2.1.4.2 Transfer procedures .................................................................................................................................................................................................................................................51
2.1.4.3 Investment financing ..............................................................................................................................................................................................................................................51
2.1.5 Tax incentives likely to be granted to investors .........................................................................................................................................................................51
2.1.5.1 General scheme tax incentives ...................................................................................................................................................................................................................52
2.1.5.2 Dispensatory scheme tax incentives ....................................................................................................................................................................................................54
2.1.5.3 Procedures to obtain incentives..................................................................................................................................................................................................................55
2.2 Implementation of incentives ......................................................................................................................................................................................................................56
2.2.1 Incentives at the implementation phase .........................................................................................................................................................................................56
2.2.2 Incentives at the operating phase ...........................................................................................................................................................................................................56
2.2.3 Obligation to reinvest profits .......................................................................................................................................................................................................................57
2.3 Institutions governing investment promotion ...........................................................................................................................................................................58
2.3.1 The National Investment Council (CNI) ...............................................................................................................................................................................................58
2.3.2 The National Investment Development Agency (ANDI) ...................................................................................................................................................59
2.3.3 One-stop service ..........................................................................................................................................................................................................................................................60
Chapter 3
Legal Forms of Incorporation in Algeria ...................................................................................................................................................................................61
3.1 Commercial companies .......................................................................................................................................................................................................................................61
3.1.1 Common elements for all commercial companies..................................................................................................................................................................61
3.1.2 The features of each commercial company-type ....................................................................................................................................................................63
3.1.2.1 The joint stock company (JSC) ....................................................................................................................................................................................................................63
3.1.2.2 The limited liability company (LLC) .......................................................................................................................................................................................................70
3.1.2.3 The sole proprietorship limited liability company (SPLLC) .............................................................................................................................................74
3.1.2.4 Limited partnership (LP) ....................................................................................................................................................................................................................................75
3.1.2.5 Limited partnership with shares (LPS) ...............................................................................................................................................................................................75
3.1.2.6 Undeclared partnership ........................................................................................................................................................................................................................................76
3.2 The Group/Joint Venture [index 49] ....................................................................................................................................................................................................77
3.2.1 The goal of the group/JV ...................................................................................................................................................................................................................................77
3.2.2 Transparency of the group’s activities ................................................................................................................................................................................................77
3.2.3 Legal status of the group/JV ........................................................................................................................................................................................................................77
3.2.4 Contractual freedom ..............................................................................................................................................................................................................................................77
3.2.5 Liability ................................................................................................................................................................................................................................................................................78
3.2.6 Practical use of groupings and temporary JV ..............................................................................................................................................................................78
3.3 Other types of establishments in Algeria ........................................................................................................................................................................................78
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
3.3.1 The liaison office .........................................................................................................................................................................................................................................................78
3.3.1.1 The principle ....................................................................................................................................................................................................................................................................78
3.3.1.2 The accreditation of the liaison office...................................................................................................................................................................................................79
3.3.1.3 Operations and obligations of the liaison office ........................................................................................................................................................................79
3.3.1.4 Advisability of resorting to a liaison office ......................................................................................................................................................................................79
3.3.2 The branch registered with the trade registry .............................................................................................................................................................................80
3.3.3 The permanent establishment .....................................................................................................................................................................................................................80
Chapter 4
Exercising Commercial Activities ..........................................................................................................................................................................................................81
4.1 The Trade Register ......................................................................................................................................................................................................................................................81
4.2 Regulated activities ................................................................................................................................................................................................................................................83
4.3 The status of foreign traders ..........................................................................................................................................................................................................................83
4.3.1 The professional card .............................................................................................................................................................................................................................................84
4.3.1.1 Conditions for obtaining the professional card ..........................................................................................................................................................................84
4.3.1.2 Establishing/Renewal of the professional card ..........................................................................................................................................................................85
4.3.1.3 Period of validity of the professional card ........................................................................................................................................................................................86
4.3.2 The foreign resident card ...................................................................................................................................................................................................................................86
Chapter 5
Foreign Trade ....................................................................................................................................................................................................................................................................................87
5.1 Legal Framework concerning Imports and Exports................................................................................................................................................................87
5.1.1 Freedom of Imports and Exports ...............................................................................................................................................................................................................87
5.1.2 Protective Trade Measures ..............................................................................................................................................................................................................................87
5.1.2.1 Safeguards .........................................................................................................................................................................................................................................................................87
5.1.2.2 Countervailing Measures ..................................................................................................................................................................................................................................88
5.1.2.3 Anti-Dumping Measures ..................................................................................................................................................................................................................................88
5.2 Obligations of Commercial Companies ..............................................................................................................................................................................................89
5.3 Customs Procedures ..............................................................................................................................................................................................................................................89
5.3.1 Customs Regulations .............................................................................................................................................................................................................................................89
5.3.2 The customs agent ...................................................................................................................................................................................................................................................90
5.3.3 The accompanying supporting documents ....................................................................................................................................................................................91
5.3.4 Bonded Warehouses Regimes .......................................................................................................................................................................................................................91
5.3.5 The temporary admission regime .............................................................................................................................................................................................................92
5.3.6 Customs value ..............................................................................................................................................................................................................................................................92
5.3.7 Measures to protect intellectual property rights .....................................................................................................................................................................93
5.3.8 The Euro-Mediterranean agreement establishing an association between the European Union and Algeria ........93
Chapter 6
Foreign Exchange Regulations ...................................................................................................................................................................................................................96
6.1 Contextual elements ...............................................................................................................................................................................................................................................96
6.2 The new role of commercial banks ........................................................................................................................................................................................................97
6.3 The principle of the free movement of capital in a commercial context ........................................................................................................97
6.4 Foreign currency accounts ..............................................................................................................................................................................................................................97
6.5 The imports system .................................................................................................................................................................................................................................................99
6.5.1 Domiciliation ..................................................................................................................................................................................................................................................................99
6.5.2 Elements or information contained in the commercial contract ..........................................................................................................................100
6.5.3 Payment of imports ................................................................................................................................................................................................................................................101
6.5.4 The exports system ................................................................................................................................................................................................................................................102
Chapter 7
Contract Law ...............................................................................................................................................................................................................................................................................103
7.1 General principles ....................................................................................................................................................................................................................................................103
7.2 The effects of the contract .............................................................................................................................................................................................................................104
7.3 Contractual liability and breach of contract ................................................................................................................................................................................104
Chapter 8
Competition Law ..................................................................................................................................................................................................................................................................107
8.1 Definition and scope of application ......................................................................................................................................................................................................107
8.2 Pricing freedom...........................................................................................................................................................................................................................................................107
8.3 Unfair contract terms ...........................................................................................................................................................................................................................................108
8.3.1 The essential components of commercial contracts ..........................................................................................................................................................108
8.3.2 Contract terms deemed unfair ....................................................................................................................................................................................................................108
8.3.3 The establishment of a controlling institution ........................................................................................................................................................................109
8.4 Prohibited restrictive practices .................................................................................................................................................................................................................109
8.5 Regulation of economic concentrations .........................................................................................................................................................................................110
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
8.6 Rules applicable to commercial practices ......................................................................................................................................................................................111
8.7 The Competitive Council ..................................................................................................................................................................................................................................112
Chapter 9
The Financial and Banking System .................................................................................................................................................................................................114
9.1 The legal framework of banking activities ...................................................................................................................................................................................114
9.1.1 The provisions of the Ordinance on money and credit ....................................................................................................................................................115
9.1.1.1 Monitoring payment systems ....................................................................................................................................................................................................................115
9.1.1.2 Adapting to international accounting standards ....................................................................................................................................................................115
9.1.1.3 Strengthening banking supervision .....................................................................................................................................................................................................115
9.1.1.4 Minimum capital requirements ................................................................................................................................................................................................................115
9.1.1.5 The status of financial institutions ........................................................................................................................................................................................................115
9.1.1.6 The equity investment system ...................................................................................................................................................................................................................116
9.1.1.7 Organizations outside the banking legislation ........................................................................................................................................................................116
9.1.1.8 Group treasury operations .............................................................................................................................................................................................................................116
9.1.1.9 Regulated agreements and normal transactions ..................................................................................................................................................................116
9.1.1.10 Withdrawal of the Public Treasury from the deposit insurance fund .................................................................................................................117
9.1.1.11 The right to a bank account ..........................................................................................................................................................................................................................117
9.1.1.12 Strengthening of cooperation with foreign monetary authorities.......................................................................................................................117
9.1.2 Principles of the Algerian banking system laid down by Ordinance 03-11 pertaining to Money and Credit ..........117
9.1.2.1 Privileges granted to banks and financial institutions .....................................................................................................................................................117
9.1.2.2 Broad delegation of power to monetary authorities .........................................................................................................................................................118
9.1.2.3 Separation between the regulatory and supervisory authorities .........................................................................................................................118
9.2 The characteristics of the Algerian banking sector ...............................................................................................................................................................118
9.2.1 Diversification of the banking system ................................................................................................................................................................................................120
9.2.2 Modernization of the Algerian banking system ......................................................................................................................................................................121
9.3 Requirements for the formation and establishment of banks and financial institutions ...........................................................121
9.4 The financial market ............................................................................................................................................................................................................................................123
9.5 The fight against money laundering ....................................................................................................................................................................................................124
9.6 Prudential regulations .........................................................................................................................................................................................................................................124
9.7 Banking services ......................................................................................................................................................................................................................................................124
9.7.1 Banking approach ....................................................................................................................................................................................................................................................125
9.7.2 Banking products and services ..................................................................................................................................................................................................................125
Chapter 10
The Algerian Accounting System ........................................................................................................................................................................................................128
10.1 General background on the Algerian Accounting System .............................................................................................................................................128
10.1.1 The existing accounting plan .......................................................................................................................................................................................................................128
10.1.2 Revaluations .................................................................................................................................................................................................................................................................128
10.1.3 The new financial and accounting system (FAS) ....................................................................................................................................................................129
10.2 The financial and accounting system ................................................................................................................................................................................................129
10.2.1 Required financial statements ..................................................................................................................................................................................................................130
10.2.2 Balance sheet format ............................................................................................................................................................................................................................................130
10.2.3 Format of the balance sheet .........................................................................................................................................................................................................................132
10.2.4 Detailed accounting plan and nomenclature of the FAS project ..........................................................................................................................134
10.2.5 The main accounting concepts and innovations introduced by the proposed FAS compared to NAP 75 .................136
10.2.5.1 General principles ....................................................................................................................................................................................................................................................136
10.2.5.2 Main innovations .....................................................................................................................................................................................................................................................137
10.2.5.3 IFRS influence in definitions and recognition criteria ........................................................................................................................................................137
10.2.5.4 Contradictions with previous legislations ....................................................................................................................................................................................138
10.2.6 Organizational rules of the FAS ..140
10.2.7 Analysis of the main accounting rules or standards .........................................................................................................................................................139
10.2.7.1 Property, plant and equipment .................................................................................................................................................................................................................139
10.2.7.2 Non-current financial assets ........................................................................................................................................................................................................................141
10.2.7.3 Inventory ..........................................................................................................................................................................................................................................................................142
10.2.7.4 Trade accounts receivables .............................................................................................................................................................................................................................143
10.2.7.5 Subsidies .........................................................................................................................................................................................................................................................................143
10.2.7.6 Provisions for liabilities and charges....................................................................................................................................................................................................143
10.2.7.7 Loans and financial liabilities .....................................................................................................................................................................................................................144
10.2.7.8 Long-term contracts .............................................................................................................................................................................................................................................144
10.2.7.9 Leasing contracts and deferred taxes .................................................................................................................................................................................................145
10.2.7.10 Method and valuation changes .................................................................................................................................................................................................................145
10.2.7.11 Rules of consolidation, goodwill and concessions ...............................................................................................................................................................146
10.2.8 Conclusion regarding the FAS proposal under review ....................................................................................................................................................146
10.3 Latest elements concerning FAS ..............................................................................................................................................................................................................147
10.3.1 Transition-related problems ...........................................................................................................................................................................................................................147
10.3.1.1 Contents of these instructions ...................................................................................................................................................................................................................147
10.3.1.2 Examination of general provisions ........................................................................................................................................................................................................147
10.3.1.3 Procedures that have to be implemented ......................................................................................................................................................................................148
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
10.3.1.4 Accounting provisions related to the transition ......................................................................................................................................................................149
10.3.1.5 Contents of the methodological notes: ............................................................................................................................................................................................149
10.3.1.6 Details that are not contained in the instructions .................................................................................................................................................................152
10.3.2 Position of the tax authorities.....................................................................................................................................................................................................................152
10.3.2.1 Provisions of the Supplementary Finance for 2009 relating to FAS ....................................................................................................................152
10.3.2.1.1 Monitoring long-term contracts ................................................................................................................................................................................................................152
10.3.2.1.2 Provisions .........................................................................................................................................................................................................................................................................153
10.3.2.1.3 Preliminary expenses ...........................................................................................................................................................................................................................................153
10.3.2.1.4 Asset revaluation ......................................................................................................................................................................................................................................................153
10.3.2.1.5 General framework .................................................................................................................................................................................................................................................154
10.3.2.1.6 Conclusion .......................................................................................................................................................................................................................................................................154
10.3.2.2 Provisions relating to the 2010 Finance Law ..............................................................................................................................................................................154
10.3.2.2.1 Treatment of Leasing ............................................................................................................................................................................................................................................154
10.3.2.2.2 Operating depreciation.......................................................................................................................................................................................................................................154
10.3.2.2.3 Reversal of preliminary expenses ...........................................................................................................................................................................................................154
10.3.2.2.4 Treatment of grants ................................................................................................................................................................................................................................................155
10.3.2.3 Provisions of the supplementary Finance Law for 2010 affecting the FAS .................................................................................................155
10.3.3 Conclusion .......................................................................................................................................................................................................................................................................156
Chapter 11
The Tax System in Algeria ................................................................................................................................................................................................................................157
11.1 Taxation of individuals .......................................................................................................................................................................................................................................157
11.1.1 Tax liable individuals ...........................................................................................................................................................................................................................................157
11.1.2 Residents and non-resident Algerians ..............................................................................................................................................................................................157
11.1.2.1 Domestic rules ...........................................................................................................................................................................................................................................................157
11.1.2.2 Treaty rules .....................................................................................................................................................................................................................................................................157
11.1.3 Definition of Global income tax (Impôt sur le revenu global, IRG) ......................................................................................................................158
11.1.4 Tax regime ......................................................................................................................................................................................................................................................................158
11.1.4.1 Taxation of salaries ................................................................................................................................................................................................................................................158
11.1.4.1.1 Determination of taxable income ..........................................................................................................................................................................................................158
11.1.4.1.2 Tax system for Algerian salaried workers ......................................................................................................................................................................................158
11.1.4.1.3 Tax system for expatriate salaried workers ...................................................................................................................................................................................159
11.1.4.2 Taxation of income from movable capital ......................................................................................................................................................................................159
1.1.1.4.2.1 Revenues from dividends and membership shares ............................................................................................................................................................159
1.1.1.4.2.2 Revenues from debt securities, deposits and guarantee bonds ...........................................................................................................................160
1.1.1.4.3 Taxation of capital gains ...................................................................................................................................................................................................................................160
1.1.1.4.3.1 Capital gains on property conveyances ...........................................................................................................................................................................................160
1.1.1.4.3.2 Capital gains from the transfer of capital assets ...................................................................................................................................................................160
1.1.1.4.4 Other revenue categories ...............................................................................................................................................................................................................................161
1.1.1.4.4.1 Industrial and commercial profits (ICP) .............................................................................................................................................................................................161
1.1.1.4.4.2 Non-commercial earnings ..............................................................................................................................................................................................................................162
1.1.1.4.4.3 Property revenues ..................................................................................................................................................................................................................................................162
11.2 Main taxes paid by legal entities .............................................................................................................................................................................................................162
11.2.1 Resident legal entities .......................................................................................................................................................................................................................................162
11.2.1.1 Direct taxes .....................................................................................................................................................................................................................................................................162
11.2.1.1.1 Corporate income tax (IBS) ..........................................................................................................................................................................................................................162
11.2.1.1.2 Tax on professional activities (TAP) .......................................................................................................................................................................................................167
11.2.1.1.3 Dividends .........................................................................................................................................................................................................................................................................169
11.2.1.2 Value Added Tax (VAT) ..........................................................................................................................................................................................................................................169
11.2.1.2.1 Territoriality of the VAT ........................................................................................................................................................................................................................................170
11.2.1.2.2 Taxable operations ..................................................................................................................................................................................................................................................170
11.2.1.2.3 Calculation of the tax .........................................................................................................................................................................................................................................171
11.2.1.2.4 Assessment and payment of taxes ......................................................................................................................................................................................................171
11.2.1.2.5 Specific regimes .......................................................................................................................................................................................................................................................172
11.2.1.3 Registration fees applicable to legal entities ..............................................................................................................................................................................174
11.2.1.3.1 Registration fees on transfers ....................................................................................................................................................................................................................174
11.2.1.3.2 Registration fees for articles of incorporation .........................................................................................................................................................................175
11.2.1.3.3 Registration fees on the transfer of corporate shares and bonds for consideration .........................................................................177
11.2.1.4 Tax advantages ............................................................................................................................................................................................................................................................177
11.2.2 Non-resident legal entities .............................................................................................................................................................................................................................178
11.2.2.1 The regime of service providers ................................................................................................................................................................................................................179
11.2.2.1.1 The withholding tax regime ..........................................................................................................................................................................................................................179
11.2.2.1.2 The real income regime option ..................................................................................................................................................................................................................179
11.2.2.1.3 Sale of equipment ...................................................................................................................................................................................................................................................179
11.2.2.1.4 Delivery of services and tax treaties ....................................................................................................................................................................................................179
11.2.2.2 The construction regime ..................................................................................................................................................................................................................................180
11.2.2.2.1 The real income taxation regime ............................................................................................................................................................................................................180
11.2.2.2.2 Tax declaration obligations ...........................................................................................................................................................................................................................180
11.2.2.2.3 EPC contracts and tax treaties ..................................................................................................................................................................................................................180
11.2.2.3 Specific circumstances linked to the existence of a grouping ...............................................................................................................................181
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
11.2.2.3.1 Signing a grouping contract Signing a grouping contract ........................................................................................................................................181
11.2.2.3.2 Invoicing and earnings distribution problems ..........................................................................................................................................................................181
11.2.2.4 Double taxation treaties...................................................................................................................................................................................................................................181
11.2.2.4.1 General presentation ...........................................................................................................................................................................................................................................182
11.2.2.4.2 List of treaties signed by Algeria .............................................................................................................................................................................................................182
11.2.2.4.3 Presentation and analysis of the OECD model convention ........................................................................................................................................184
11.3 Supervision and litigation ..............................................................................................................................................................................................................................186
11.3.1 Control procedures and the guarantees of taxable persons ......................................................................................................................................186
11.3.1.1 Controlling declarations ...................................................................................................................................................................................................................................186
11.3.1.1.1 Definition ..........................................................................................................................................................................................................................................................................186
11.3.1.1.2 Control procedures ................................................................................................................................................................................................................................................186
11.3.1.1.3 Correction of the declarations....................................................................................................................................................................................................................186
11.3.1.2 Accounting audits ...................................................................................................................................................................................................................................................187
11.3.1.2.1 Audit notification dispatch ............................................................................................................................................................................................................................187
11.3.1.2.2 Prior preparation period ...................................................................................................................................................................................................................................187
11.3.1.2.3 Assistance of counsel .........................................................................................................................................................................................................................................187
11.3.1.2.4 Place of audit................................................................................................................................................................................................................................................................188
11.3.1.2.5 Time limit of accounting audits ...............................................................................................................................................................................................................188
11.3.1.2.6 Provision prohibiting the renewal of accounting audits ................................................................................................................................................188
11.3.1.2.7 Notification of adjustments .........................................................................................................................................................................................................................188
11.3.2 Litigation............................................................................................................................................................................................................................................................................190
11.3.2.1 The prior administrative appeal ................................................................................................................................................................................................................190
11.3.2.1.1 Jurisdiction of the director of the DGE ..............................................................................................................................................................................................190
11.3.2.1.2 Investigation of the claim ................................................................................................................................................................................................................................190
11.3.2.1.3 Choosing a residence in Algeria ................................................................................................................................................................................................................191
11.3.2.1.4 Statutory payment deferment ....................................................................................................................................................................................................................191
11.3.2.1.5 Jurisdiction of the central tax authorities ......................................................................................................................................................................................192
11.3.2.2 Appealing before the Central Commission ...................................................................................................................................................................................192
11.3.2.2.1 Deadline for petitioning .....................................................................................................................................................................................................................................192
11.3.2.2.2 Effect of the Central Commission’s opinion ................................................................................................................................................................................193
11.3.2.3 Judicial proceedings .............................................................................................................................................................................................................................................193
11.3.2.3.1 Proceedings before the administrative court ..............................................................................................................................................................................193
11.3.2.3.2 Proceedings before the State Council ...............................................................................................................................................................................................193
11.4 Taxation of corporate groups .......................................................................................................................................................................................................................194
11.4.1 Definition of corporate groups ...................................................................................................................................................................................................................194
11.4.1.1 Legal definition of corporate group .....................................................................................................................................................................................................194
11.4.1.2 Definition of a corporate group from a tax standpoint.....................................................................................................................................................195
11.4.2 The regime applicable to corporate groups ..................................................................................................................................................................................195
11.4.2.1 The legal regime ........................................................................................................................................................................................................................................................195
11.4.2.2 The tax regime.............................................................................................................................................................................................................................................................196
11.4.2.2.1 Applicable tax rate ..................................................................................................................................................................................................................................................196
11.4.2.2.2 Consolidation of earnings................................................................................................................................................................................................................................197
11.4.2.2.3 Granted tax advantages ....................................................................................................................................................................................................................................197
11.4.2.2.4 Declaration obligations of corporate groups ..............................................................................................................................................................................298
11.4.3 Financial flexibility granted to corporate groups .................................................................................................................................................................298
Chapter 12
Social Systems ..........................................................................................................................................................................................................................................................................201
12.1 The main characteristics of labor law .................................................................................................................................................................................................201
12.1.1 Law No. 90-11 of 21 April, 1990 concerning employment relationships ..........................................................................................................201
12.1.2 Collective bargaining ............................................................................................................................................................................................................................................201
12.1.3 Internal rules .................................................................................................................................................................................................................................................................202
12.1.4 Exercising union rights ......................................................................................................................................................................................................................................202
12.1.5 Organs of representation ...............................................................................................................................................................................................................................202
12.1.6 Employer obligations concerning registers .................................................................................................................................................................................203
12.1.7 Recruitment ...................................................................................................................................................................................................................................................................203
12.1.8 Legal workweek ........................................................................................................................................................................................................................................................205
12.1.9 National guaranteed minimum wage ................................................................................................................................................................................................206
12.1.10 Legal rest periods and leave .........................................................................................................................................................................................................................206
12.1.11 Training and promotion while employed .......................................................................................................................................................................................207
12.1.12 Amendment, suspension and termination of the employment relationship ...........................................................................................208
12.2 Social security, retirement and unemployment .......................................................................................................................................................................211
12.2.1 Subjection and affiliation .................................................................................................................................................................................................................................211
12.2.2 Retirement .......................................................................................................................................................................................................................................................................212
12.2.3 Organization of unemployment insurance ....................................................................................................................................................................................213
12.2.4 Assessment basis, payment, control and litigation .............................................................................................................................................................215
12.2.4.1 Assessment basis of contributions........................................................................................................................................................................................................215
12.2.4.2 Payment ..............................................................................................................................................................................................................................................................................215
12.2.4.3 Verification .......................................................................................................................................................................................................................................................................216
12.2.4.4 Litigation............................................................................................................................................................................................................................................................................216
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.
12.3 The independent consultant and the work contract ...........................................................................................................................................................219
12.4 The status of the expatriate ..........................................................................................................................................................................................................................219
12.4.1 Conditions of entry, stay and movement of foreigners ....................................................................................................................................................219
12.4.1.1 General provisions...................................................................................................................................................................................................................................................219
12.4.1.2 Conditions of Entry and Exit of Foreigners ..................................................................................................................................................................................220
12.4.1.3 Conditions of stay for non-residents...................................................................................................................................................................................................220
12.4.1.4 Conditions of residence for foreigners ..............................................................................................................................................................................................220
12.4.1.5 Conditions for movement of foreigners ..........................................................................................................................................................................................221
12.4.1.6 Declaration of employment and accommodation for foreigners ..........................................................................................................................221
12.4.1.7 Expulsion and escort to the border ......................................................................................................................................................................................................221
12.4.1.8 Penalties ............................................................................................................................................................................................................................................................................222
12.4.2 Recruitment conditions.....................................................................................................................................................................................................................................222
12.4.2.1 In the private economic sector ..................................................................................................................................................................................................................222
12.4.2.2 In the public service sector ..........................................................................................................................................................................................................................223
12.4.3 Taxes ......................................................................................................................................................................................................................................................................................223
12.4.4 Repatriation of salaries ......................................................................................................................................................................................................................................223
12.5 Social security .............................................................................................................................................................................................................................................................224
Chapter 13
The Algerian Justice System .......................................................................................................................................................................................................................226
13.1 The judicial organization .................................................................................................................................................................................................................................226
13.1.1 The tribunals .................................................................................................................................................................................................................................................................226
13.1.1.1 Proceedings before the tribunals ............................................................................................................................................................................................................227
13.1.1.2 Administrative tribunals ...................................................................................................................................................................................................................................228
13.1.2 The courts ......................................................................................................................................................................................................................................................................228
13.1.3 The Supreme Court ...............................................................................................................................................................................................................................................228
13.1.4 Overview of the system of legal remedies ...................................................................................................................................................................................230
13.1.5 The State Council ...................................................................................................................................................................................................................................................230
13.1.6 The specifics of administrative procedures .................................................................................................................................................................................231
13.1.7 Overview of the system of legal remedies ...................................................................................................................................................................................232
13.2 Jurisdiction of courts and tribunals with regard to emergency measures ................................................................................................232
13.2.1 Emergency measures ..........................................................................................................................................................................................................................................233
13.2.2 Orders for payment ...............................................................................................................................................................................................................................................233
13.2.3 Proceedings for interim relief ......................................................................................................................................................................................................................233
13.3 Personnel categories in the judicial system ................................................................................................................................................................................234
13.3.1 Judges .................................................................................................................................................................................................................................................................................234
13.3.2 Court officers ................................................................................................................................................................................................................................................................234
13.3.3 Civil servants ................................................................................................................................................................................................................................................................234
13.4 Customs Disputes ...................................................................................................................................................................................................................................................234
13.4.1 Persons empowered to establish the occurrence of customs violations and their powers .....................................................235
13.4.2 Methods of establishing customs violations .............................................................................................................................................................................235
13.4.3 Scope of jurisdictions ..........................................................................................................................................................................................................................................236
13.4.3.1 Absolute jurisdiction ............................................................................................................................................................................................................................................236
13.4.3.2 Territorial jurisdiction ...........................................................................................................................................................................................................................................236
13.4.4 Customs offenses ....................................................................................................................................................................................................................................................237
13.4.4.1 Misdemeanors ............................................................................................................................................................................................................................................................237
13.4.4.2 Petty customs offenses......................................................................................................................................................................................................................................237
13.4.5 Main violations likely to be uncovered by the verification of merchandise .............................................................................................238
13.4.6 Prosecutions and punishment of customs violations.......................................................................................................................................................238
13.4.7 Organization of the directorate general of customs ...........................................................................................................................................................240
13.5 Alternative dispute resolution ...................................................................................................................................................................................................................240
13.5.1 Arbitration .......................................................................................................................................................................................................................................................................240
13.5.2 Mediation .........................................................................................................................................................................................................................................................................240
Chapter 14
Arbitration ..........................................................................................................................................................................................................................................................................................242
Chapter 15
The Legal Regimes for Hydrocarbons and Mining .......................................................................................................................................244
15.1 Hydrocarbons...............................................................................................................................................................................................................................................................244
15.1.1 The legislative framework ............................................................................................................................................................................................................................244
15.1.2 The tax system ...........................................................................................................................................................................................................................................................246
15.1.2.1 The upstream (exploration and/or exploitation activities) tax system ..........................................................................................................246
15.1.2.1.1 The surface tax ...........................................................................................................................................................................................................................................................246
15.1.2.1.2 Oil royalties ....................................................................................................................................................................................................................................................................246
15.1.2.1.3 Tax on oil revenues (TOR) ...............................................................................................................................................................................................................................247
15.1.2.1.4 The Additional Tax on Income .....................................................................................................................................................................................................................248
15.1.2.1.5 Tax on flaring ................................................................................................................................................................................................................................................................248
© 2012 KPMG Algérie SPA, membre algérien du réseau KPMG constitué de cabinets indépendants adhérents de KPMG International Coopérative, une entité de droit suisse. Tous droits réservés. Imprimé en Algérie.