IE vs LLC in Armenia: key differences

If you plan to do business in Armenia, the first question is which form to choose: an individual entrepreneur (IE, ԱՁ) or a limited liability company (LLC, ՍՊԸ). Both are registered by the Agency of the State Register of Legal Entities of the Ministry of Justice.

Individual entrepreneur

An IE is a natural person registered to carry out business activity. According to hartak.am:

• both Armenian citizens and foreign nationals can register;
• online registration is available to holders of an Armenian ID card with an electronic signature; everyone else applies in person at a service centre;
• foreign nationals need a passport with a notarised Armenian translation;
• the duty for a paper application is AMD 3,000; online filing is reportedly free (this needs confirmation);
• registration happens immediately after the documents are submitted and the activity type is selected.

Limited liability company

An LLC is a separate legal entity. According to e-register.moj.am and hartak.am:

• an LLC can have one or more participants, up to 49;
• state registration of an LLC is free;
• with the template charter, registration is immediate; otherwise it takes up to 2 business days;
• you need the founder's decision (or minutes of the founders' meeting), the charter, an application to register the company name and documents of the participants and the director;
• the name can be checked in the register and reserved for up to 6 months.

Note: using "Hay", "Armenia", "Armenian" or their translations in the name is subject to a duty of AMD 600,000 per year (unless it is part of the founder's name).

Liability

As a rule, an IE is liable for business obligations with their own property, while LLC participants are liable within their contributions. The exact consequences depend on the situation — discuss them with a lawyer.

Reporting and taxes

All legal entities submit beneficial ownership information to the register by 20 February each year (or confirm that the previous declaration is still current). We recommend confirming the deadline for the first declaration after registration with a specialist.

Armenia has several tax regimes (the general regime, turnover tax, micro-enterprise). Thresholds and rates change, so we do not quote figures — discuss the choice of regime with a tax adviser and check petekamutner.am.

Which to choose

An IE is usually simpler for one person with a modest volume of activity. An LLC suits a business with several participants or one that needs a separate legal entity and a separation of assets. The decision depends on your plans, partners and tax implications.

Good to know

• Some activities require a licence — this is checked separately.
• Requirements for a public services number and address registration for foreign nationals registering an IE or LLC still need confirmation.
• Documents of corporate (especially foreign) founders usually require an apostille and translation.

This guide is for information only. Official sources: e-register.moj.am, hartak.am.