Trade Regulations

The Ministry of Commerce and Industry is the custodian of trade policies and regulations. The government promotes an open trade policy for both local and foreign investors. Rules guiding investment procedures for foreign investors are clearly spelt out in the Foreign Investment Law.

Both foreign and local investors will be subjected to similar trade regulations when participating in trade. These include:

(1) Payment of all taxes and fees due to the state. The following taxes will apply:

  1. Customs and excise: The Somaliland customs tariff makes use of both specific and ad valorem duty rates which range from 3% to 70%. The average duty is approximately 30%. Higher rates of duty are applied to none essential or luxurious items such as Khat, cigarettes and perfumes.

  2. Harbour tax: There is wharfage fee imposed on all goods entering or leaving Somaliland through all maritime ports at the rate of 3% of value. Goods exempted from this fee are:

  1. Livestock/pets belonging to a foreign sovereign or head of state under a reciprocity arrangement

  2. Samples of goods, provided not directly utilizable

  3. Duty except goods imported by state

  4. Materials for humanitarian assistance

(2) Obtain all the relevant documentation needed to execute trade. They include:

  1. Certificate Origin: The certificate of origin applicable to the exporter’s consignment depends on the country of destination and on the possibility for it benefiting from any scheme of preferential tariffs. This certificate is issued by the SLCCIA.

  2. Certificate of Health: Most countries require veterinary or sanitary certificates with respect to animals and animal products in order to be in a position to satisfy the buyer.

  3. Movement Permit: This applies to livestock and is issued by the veterinary authorities at the source market to signify that the livestock have met all the specified health requirements. These will be required before animals are admitted to the quarantine stations at the ports of exit.

  4. Shipping documents: Shipping is the most used mode of transport for moving goods to and from Somaliland’s to customers and suppliers located around the world. It is preferred to air transport because it is cheaper and more convenient for heavy and bulky cargo. Marine transport is available at the port of Berbera which serves all cargo originating from and destined to other ports of the world. The documents required for shipment to/from Somaliland are:

  • The commercial invoice in triplicate which must contain all necessary information to establish the cost, insurance, and freight (CIF) value of goods
  • A bill of landing or Airway Bill
  • And in certain instances, health and other special certificates

The required shipping documents should not accompany ocean freight ships, but should be forwarded by airline to ensure that they reach the consignee prior to the arrival of the goods. For shipments by the air cargo, the shipping documents may either accompany the goods or be attached to the consignment notes. The net weight in kilograms must be shown on the invoice or papers accompanying any shipment of goods to Somaliland. In addition, the quality of individual commodities should be indicated in units of measures commonly associated with those goods.

(3) Obtain all the relevant licenses needed to execute trade. They include:

  1. Export Licenses. These will apply to all investors who would like to invest in export trade. The documents required for issuance of export licenses are:

Individual traders:

  • Identity card (national) or Passport photo copy (foreign resident)
  • Original bank statement for 5million Somaliland shillings
  • Two passport size photographs
  • Fixed assets USD 10,000 or 30 million Somaliland shillings
  • Penal certificate issued by the Attorney General’s office
  • Tax clearance certificate from the land revenue office
  • Chamber of Commerce Registration

Corporate traders:

  • Certificate of registration of the company issued by the Attorney General’s office
  • Memorandum and Article of Association of the Company
  • Specimen signature of the Chief Executive Officer of the Company
  • Licenses fee- 2084,000 Somaliland shillings equivalent to US$ 600
  • Tax Clearance Certificate from the Land Revenue Office
  • Chamber of Commerce Registration.

  1. Clearing and forwarding and shipping agencies license. This will be required for those who need to invest in clearing, forwarding or shipping business. Documents required are:

Individual traders:

  • Identity Card (National) or Passport Photo Copy (foreign resident)
  • Original Bank Statement for 5 million Somaliland shillings or USD 1,500
  • Two passport size photographs
  • Fixed assets USD 30,000
  • Penal Certificate issued by the Attorney General’s Office
  • Tax Clearance Certificate from the Land Revenue Office
  • Chamber of Commerce Registration

Corporate traders

  • Certificate of Registration of the company issued by the Attorney General’s office
  • Memorandum and Article of Association
  • Specimen signature of the Chief Executive Officer of the company
  • Licenses fee US$ 200
  • Tax clearance certificate from the Land Revenue Office
  • Chamber of Commerce Registration