Starting a Business · Afghanistan
Starting a business in Afghanistan: foreigner's guide (2026)
Afghanistan shaded by its starting a business status
Afghanistan formally permits 100% foreign ownership and imposes no statutory minimum capital for LLC formation under its 2016 Investment Law, but the practical environment for foreign business formation is severely constrained. The Taliban's designation as a Specially Designated National (SDN) by the US Treasury/OFAC creates material sanctions-compliance risk for any foreign entity transacting with Taliban-controlled government bodies, including MoCI and ACBR. Compounded by frozen central bank reserves (~$9 billion), a collapsed international banking linkage, and a GDP that fell an estimated 26% after the 2021 Taliban takeover, effective foreign business entry is highly restricted in practice.
Key points
The Afghanistan Investment Law (2016) permits 100% foreign ownership across all sectors, with no sector carve-outs for foreign investors. Investments exceeding USD 3 million require approval from the High Commission on Investment (HCI).
There is no statutory minimum share capital requirement for establishing a Limited Liability Company (LLC) in Afghanistan. However, applicants must provide proof that initial capital has been deposited in an Afghan bank as part of the ACBR registration package.
Formation involves: (1) name reservation and referral letter from a license authority (MoCI/AISA); (2) submission of Articles of Incorporation, passport copies, and photos to ACBR; (3) AISA investment license application — statutory 14-day evaluation window; (4) publication in the Official Gazette; (5) issuance of Registration Certificate and Tax Identification Number (TIN). End-to-end timeline is typically several weeks to months in practice.
The Taliban is listed as a Specially Designated National (SDN) by OFAC. Afghanistan is NOT subject to comprehensive US sanctions, and OFAC has confirmed that general trade and money transfers to Afghanistan not involving SDN-listed parties are not prohibited. However, any payments, licensing fees, or regulatory approvals channelled through Taliban-controlled government entities carry sanctions-violation risk, creating a significant compliance barrier for foreign companies.
Afghanistan's central bank reserves (approximately $9 billion) remain frozen at the US Federal Reserve since August 2021. The country has lost access to the international banking system, severely limiting the ability to capitalise a new entity, repatriate profits, or conduct cross-border transactions.
Afghanistan ranked 173 out of 190 economies in the World Bank Doing Business index (last scored before discontinuation). Real GDP fell roughly 26% following the Taliban takeover; the World Bank's December 2025 update notes some modest expansion but flags persistent governance, security, and private-investment barriers. The Heritage Foundation's Index of Economic Freedom rates Afghanistan among the least-free economies globally.
Afghanistan - other topics
Last verified 5/24/2026 · Orientation, not legal advice - verify against the primary sources linked above. Explore the full world map →