• Partnership. A partnership may be registered as a separate legal entity or it can be formed as an agreement between the partners (contractual partnership). Partnerships generally are less regulated and offer more flexibility. Unlike an LLC or a JSC where the company is managed by a single director (chief executive officer), a partnership may be actively managed by several partners. It is possible to create either a general partnership or a limited partnership. General partners are personally liable for the debts of the business, whereas the limited partners are passive investors who cannot lose more than their investment. A contractual partnership is not subject to registration, however the tax office must be notified of its creation. 
• Cooperative. A cooperative is an association of workers where each member has one vote and profits are shared based on contribution of labor, not capital. This is a unique corporate form that better suits smaller employee-owned businesses which value labor more than capital. Special regulations apply to agricultural cooperatives.
• Private Equity Fund. A private equity fund is an entity used for making investments in real estate, securities and other assets. A private equity fund is registered by the Central Bank of Armenia and enjoys substantial tax benefits, such as annual tax equal to only 0.01% of the net value of its assets, tax-free distribution of profits etc. 
• Non-Corporate Forms of Doing Business. Business partners may also enter into non-corporate forms of collaboration based on contractual agreements of joint-venture, franchising, trust management, agency, commission, delegation etc.

To select the right form for your business you may have to consider a number of tax and non-tax factors, such as limited liability, setup and maintenance costs, privacy, number of shareholders, management structure and exit options. 

• Branch Office (BO). A branch office is a territorial unit (subdivision) of a foreign company in Armenia. It is not a separate legal entity but an extension of a foreign company. Branch offices operating in Armenia are required to register with the State Registry and to get a taxpayer ID number.
• Subsidiary. A subsidiary is a locally registered company (LLC or JSC) that is wholly or partly owned by a foreign company. All corporate matters are regulated by the Armenian law. Because of the limited liability the subsidiary's creditors will not be able to reach the foreign shareholders. 

• Representative Office. A representative office is similar to a branch office with the exception that it is not allowed to engage in business activities. Its role is limited to representing the interests of the foreign company in Armenia. Representative offices operating in Armenia are required to register with the State Registry and to get a taxpayer ID number.
• Permanent Establishment. A permanent establishment is primarily a tax concept. It exists where a foreign company maintains a certain level of business presence in Armenia. The choice of registering a permanent establishment is primarily motivated by tax reasons. The Tax Office registers permanent establishments and assigns taxpayer ID numbers to them.

If the primary purpose of setting up a business entity in Armenia is to hire local employees you may consider, as an alternative, using employer or record services. Such a solution can reduce costs and compliance risks. Employer of record services normally include recruiting, onboarding, arranging local payroll, filing taxes, making salary payouts, providing employee benefits, etc.

Non-profit organizations in Armenia  are normally established in the form of foundations or public associations. 

• Public Association. A public association is a membership-based organization, which caters primarily to the needs of its members (e.g. professional associations, clubs, etc.). A public association is managed by an executive manager (management board) appointed by the general meeting of the members.
• Foundation. Foundations do not have members and are used primarily to fund charitable projects that benefit certain classes or the society at large. Foundations are governed by a board of trustees, initially appointed by the founders. An executive manager is appointed by the board. 

Both the foundation and the public association can engage in business and other income-generating activities. Such income is taxed at regular rates applicable to for-profit organizations. However membership fees, charitable donations and other gratuitous transfers (monetary and in-kind) made to non-profit organizations are not taxable. Non-profit organizations may choose to establish for-profit organizations (LLC, JSC, etc.) to separate the business operations from their main activities.

• Religious Organization. Registration of a religious organization is dependent upon obtaining a certificate from the Council or Religious Affairs confirming that the religion is "traditional" (based on a historically canonized scripture and part of the modern system of  religious and ecclesiastical communities) and that the organization has at least 200 members (not including minors). 
• Institution.  An institution is a structural or territorial unit established within a legal entity to pursue non-profit activities in areas of education, athletics, culture, governance etc. An institution has its articles of organization but it is not granted the status of a legal entity. The founding organization is liable for the debts of the institution. 

• Registration Process. Company formation and corporate amendments are registered with the State Registry of Legal Entities of the Armenian Ministry of Justice. You do not have to personally appear before the Registry as lawyers can complete the formalities (file the registration documents) with a power of attorney. Typically company registration is followed by ordering a corporate rubber stamp and filing statements with the tax office.
• Timeline. Remote registration can take as little as one business day if fast-track service fees are paid or three business days if no such fee are paid. Certain registrations related to branch offices and non-profits can take longer. 
• Documents. Document requirements may vary form case to case but, in general, individual shareholders and directors are required to provide original or legalized copies (i.e. Apostille or consular legalization) of their passports. Corporate shareholders and directors are required to provide legalized copies of their corporate documents - certificate of registration and articles of incorporation or equivalent documents. Originals or legalized copies are necessary in order to have them translated into Armenian language and notarized. 
• Cost. Incorporation costs consist of government fees, legal fees and other expenses, such as fees for translation, corporate stamps, mailing etc.

A company registered in Armenia must have a business name (firm name) to which it has exclusive rights. The business name shall consist of a distinguishing word or expression (common or proper name, fictitious name or sequence of letters) and the corporate form of the company (e.g. ACME LLC). A business name can be changed but it cannot be assigned to another person unless the company reorganizes. 

The use of words "Armenia," "Armenian," "Arm," the names of Armenian regions, cities, villages can only be used with the approval of the national or local authorities. The annual government fee for using the words "Armenia" or "Armenian" is AMD 600,000 (US$1,233). Moreover, a business name cannot contain names the use of which requires a special license or permit (e.g. "bank," "insurance," "notary," etc.). 

A business name cannot be identical or confusingly similar to a business name or trademark previously registered in Armenia. Name searches can be conducted in advance of registration at the websites of the State Registry and the Intellectual Property Agency. While a firm name grants its holder exclusive rights to use it, you should also consider registering a trademark as it generally offers a better protection. 

To be registered in Armenia the company must have a legal address to which official letters and notifications will be sent. You are not required to own or lease business premises in Armenia and you can use your residential address for company registration purposes. If you do not have an address in Armenia it can be provided to you by your lawyer.

The legal address is used for official correspondence and it may be different from the actual place of business. The legal address must be shown in the articles of organization of the company. If the address is changed the articles have to be amended accordingly.

Having a local phone number is also important as the tax office and other government agencies will primarily use the phone for urgent communication with the company.

• Shareholders. There are generally no restrictions on shareholding in Armenia. Foreign individuals and legal entities are allowed to be 100% owners of Armenian companies without having to involve local partners, directors, employees etc.
  • Dividends. If dividends are formally declared and distributed to shareholders they may be subject to taxation. Individual shareholders pay income tax of 5%. Dividends paid to non-resident corporate shareholders are also subject to a 5% withholding tax, while dividends received by Armenian companies are exempt from taxation. The rate of 5% applicable to non-resident shareholders can be reduced by a double tax treaty.
  • Limited Liability. Shareholders generally enjoy limited liability, which means that they cannot lose more than the amount invested and they are not personally responsible for the debts of the company. However, shareholders may be held liable if they knowingly (intentionally) caused the bankruptcy of the company.
• Managers. In Armenia companies are normally managed by a single director (chief executive officer) who acts on behalf of the company by virtue of law and can issue powers of attorney to other managers. It is possible, but uncommon, to have an upper-level board of directors. Creation of a board is legally required for companies with more than 49 shareholders. Directors can be individuals or legal entities. Directors and other managers may be held liable for damages caused to the company if they act unreasonably or in bad faith. Directors may also be held liable for administrative and criminal offenses resulting from mismanagement (including tax evasion, money laundering, currency control, immigration offenses, etc.). Managers may also be held liable for intentional bankruptcy of the company. Having an internal auditor (audit committee) is required for all JSCs and for LLCs with more than 20 shareholders.

As of 2022, there are seventeen banks in Armenia offering banking services to individual and corporate clients, both resident and non-resident. All the banks are privately owned and regulated by the Central Bank. In addition to the well-known HSBC international bank, many local banks are with foreign capital from Russia (VTB Bank), France (ACBA-Credit Agricole Bank), Lebanon (Byblos Bank, Anelik Bank), Argentina (Converse Bank), Iran (Mellat Bank) and other countries.

Armenian banks offer decent customer service, low charges, enhanced privacy and a wide range of modern banking services, including:

• Online and mobile banking, phone banking;
• Debit and credit cards (Visa, MasterCard, AmEx);
• International bank transfers and money remittance services;
• Accounts in USD, EUR, CHF, GBP, CAD, AED, RUR, JPY;
• Gold accounts;
• Wealth management and private banking;
• Deposit boxes, etc.
  

• Opening a Bank Account. Opening a corporate bank account in Armenia typically takes 1-3 business days, depending on the length of background checks conducted by the bank. It may also be possible to open a bank account in Armenia remotely, with a power of attorney. Armenian banks generally do not have minimum deposit requirements and charge only minimum fees for maintaining a bank account. A corporate applicant would be required to present the company registration papers and passport copies of directors, shareholders and beneficiaries (UBO). The bank may request additional documents, such as proof of address, source of income, police clearance certificate, etc.
• Secrecy. Bank secrecy is strictly protected by law. Disclosing bank secrets is a crime punishable by imprisonment and monetary fines. Normally a court order is required for a bank to release information on bank accounts. Under anti-money laundering (AML) regulations banks are  required to report suspicious activity to the Central Bank.  Armenia does not participate in AEOI/CRS but has a FATCA agreement with the U.S.
• Interest rates and taxes. As of February 2022, banks offer interest rates of up to 10% for deposits in local currency and 5% for deposits in U.S. dollars. Corporate bonds listed on the Armenian stock exchange generally offer higher rates. Investment services are provided by banks and investment companies, also licensed by the Central Bank. Interest income is generally taxed at 10%. 
• Safety. All banks are licensed and regulated by the Central Bank of Armenia. Bank deposits and bank account balances of up to AMD 16 million in local currency (approx. $33,000) and AMD 7 million in foreign currency (approx. $14,000) are insured by the Deposit Guarantee Fund of Armenia. The deposit insurance system has never been used as there have been no bank runs in the recent history.
• Merchant accounts and payment gateways. Merchant account and Internet acquiring services are available. They allow merchants to accept online payments made with VISA and MasterCard cards through their websites. Generally banks provide the required software free of charge and the merchant does not have to incur additional expenses on programming, certification procedures etc. Payment gateways such as 2checkout work with Armenian bank accounts.

The general business license is generally sufficient to start your business in Armenia. However, certain businesses require additional licenses at the national or local level. In certain cases only a formal notification is required. 

National License

Local License

Notification

There are no requirements for a newly registered business to become a member of a chamber of commerce or any other other professional association. However, you may join such associations on a voluntary basis. Below is a list of the most popular associations:

• Chamber of Commerce and Industry of the Republic of Armenia
• Chamber of Commerce and Industry of Yerevan
• American Chamber of Commerce
• Union of Manufacturers and Businessmen of Armenia
• Republican Union of Employers of Armenia
• Women Entrepreneurs Network in Armenia
• Union of Advanced Technology Enterprises

Corporate Amendments. Amendments in the articles of the company must be registered with the State Registry.  In particular, changes in the name of the company, its statutory capital, address, executive directorship require making amendments to the articles. In case of a limited liability company (LLC) changes in shareholding also must be registered. Documents submitted are checked and registered within two business days, unless the applicant pays the fast-track service fees for urgent registration (see the table below).

Dissolution. Dissolution of a company requires posting an announcement on the official website www.azdarar.am to notify the creditors of the company. The creditors have two months to file their claims. The tax office has 20 days to submit its claims for unpaid taxes. Normally this is preceded by a tax audit in the company. The dissolution of the company also involves working with the National Archive and the Police in order to archive the corporate documents and to hand over the company's stamp, respectively. 

The alternative to dissolution can be filing a declaration with the tax office stating that the company is inactive. The inactive (dormant) company will remain on the register but will not be required to file tax returns or pay taxes. 

Reorganization. Reorganization of the company can take the form of a merger, spin-off, split-off, or change in the corporate structure (e.g. LLC turns into a JSC or vice versa). Reorganization also requires posting a public announcement to notify potential creditors. 

Dissolution or corporate amendments can be registered remotely by your lawyer or other representative having the necessary power of attorney.