The right start for your business
Introduction
Fifty percent of small businesses wave the white flag of surrender within five years of their founding. This is something that cannot be overlooked when observing statistics from various countries around the world. The business environment is teeming with closures and accumulated liabilities. As the saying goes, 'How things end is determined by how they begin.' Current economic challenges and the pursuit of financial freedom are driving ambitious individuals to shape their future through both traditional and e-commerce. To reduce the chances of failure and avoid drowning in a torrent of business liabilities and fees, one must be cautious and choose the proper legal path and the right starting point tailored to the nature of the project and capital.
History
Aug 2024
The sector
Commercial Activities

While a commercial registration requires fees for its issuance and renewal, small business owners who do not need a physical headquarters to conduct their business activities—and whose businesses are based on possessing a skill or providing a specific service—should issue a freelance document. This is a document granted by the Ministry of Human Resources and Social Development to freelancers through the Freelance Portal; it is free of charge and requires no fees, while allowing the holder to open a commercial bank account linked to the document and use digital payment channels, which adds trust and credibility to their project in the eyes of customers. As for larger-scale projects and commercial entities that require a headquarters, have substantial capital and a reserved trade name, and sign contracts with employees while maintaining an administrative structure, the merchant can choose to establish a company or a sole proprietorship, depending on the differences between the two forms of establishment and the merchant's aspirations and development plan for the business. While a sole proprietorship does not possess an independent legal personality—meaning its founder is personally liable for the business's debts and obligations—a company enjoys an independent legal personality separate from its founders and has independent financial liability. Furthermore, a sole proprietorship is established by a single individual, whereas a company is generally founded by multiple people. However, having more than one founder is not a prerequisite for a company to acquire a legal personality, as a merchant can establish a "single-member company," which is a limited liability company that acquires a legal personality despite being founded by one person, as an exception to Article Two of the Companies Law, which defined a company as "a contract by which two or more persons undertake..." It is also stipulated that a single person may not establish more than one single-member limited liability company: "In all cases, a natural person may not establish or own more than one single-member limited liability company, and a single-member limited liability company (whether owned by a natural or legal person) may not establish or own another single-member limited liability company," according to Article 154 of the Companies Law. In recent years, with the advancement of technology and the shift of most merchants and service providers toward e-commerce, it has become crucial to know the legal pathways to starting an e-commerce business correctly. To offer commercial services online, it is necessary to issue an electronic commercial registration to facilitate contracts with shipping companies and to provide digital payment methods. The Ministry of Commerce has made the issuance process easy for entrepreneurs; obtaining it does not require a physical headquarters or commercial store, as activating the national address is sufficient to acquire it. The procedures for its issuance are simplified by visiting the website of the Ministry of Commerce and Investment, where it can be issued within 180 seconds.
The proper and legal start of your business limits your risk of future fines. Furthermore, conducting your business activities based on the advice of legal experts saves you much of the time and money that would otherwise be spent correcting your business's legal status later.