Libya: Operating a Business

In this page: Setting Up a Company | The Active Population in Figures | Working Conditions | Cost of Labour | Social Partners

Setting Up a Company

Limited liability company: Number of partners: Minimum 3, maximum 25
Capital (max/min): Minimum LYD 5,000
Shareholders and liability: Liability is limited to the amount contributed.
Joint stock company: Number of partners: Minimum number of shareholders according to 4 thresholds (13 shareholders; 25 shareholders; 50 shareholders; 100 shareholders).
Capital (max/min): - 1st threshold: maximum capital of 1 million LYD,
- 2nd threshold: capital of between 1 and 2 million LYD,
- 3rd threshold: capital of between 2 and 4 million LYD,
- 4th threshold: capital above 4 million LYD.
Shareholders and liability: Liability is limited to the amount contributed.
The foreign company: Number of partners: Minimum of 2 partners. One of them must be of Libyan nationality.
Capital (max/min): The capital must be between a minimum of 5 000 LYD and a maximum of LYD 30,000. The Libyan partner must hold at least 51% of the capital.
Shareholders and liability: Liability is limited to the amount contributed.
The office of representation: Number of partners: A minimum of 2 partners, one of whom must be of Libyan nationality.
Capital (max/min): The office of representation must open a non-resident bank account with funds supplied by the parent company. The deposit must be at least equal to LYD 50,000.
Shareholders and liability: Limited.
The foreign subsidiary: Number of partners: A minimum of 2 partners, one of whom must be of Libyan nationality.
Capital (max/min): The subsidiary must set aside a sum reserved for setup and operating that must be at least LYD 150,000.
Shareholders and liability: Liability is limited to the amount contributed.

The Competent Organisation: Decree n°8 of 9 January 2005 modifying some provisions of law 65/1970 stipulates that depositing a request with the Bureau of the investment Register and Commercial Register is compulsory for any foreign company wishing to open an office of representation in Libya. In the request the following must be mentioned: the name, profession and postal address of the representative responsible for filing the request.

Setting Up a Company	Libya	Middle East & North Africa
Procedures (number)	10.0	6.3
Time (days)	35.0	19.5

Source: Doing Business.

Business Setup Procedures: DCFA Libya, Libya Trade Laws.

The Active Population in Figures

	2018	2019	2020
Labour Force	2,380,697	2,422,944	2,389,259

Source: International Labour Organization, ILOSTAT database

	2017	2018	2019
Total activity rate	52.72%	52.79%	52.80%
Men activity rate	68.67%	68.79%	68.83%
Women activity rate	36.45%	36.47%	36.46%

Source: International Labour Organization, ILOSTAT database

Working Conditions

Legal Weekly Duration: 48 hours
Retirement Age: Retirement age is fixed at 65 for men, 60 for women and 62 for civil servants.
Working Contracts: Employment law is regulated by law number 15 of 1981.
Foreign employees cannot expect a work contract in Libya unless they have a work permit and a residence permit issued by the competent Libyan authorities. The contract is in the form of a written undertaking that must include:
- the duration of the undertaking,
- the rights and obligations of the employee,
- the number of hours worked daily and weekly,
- holidays,
- length of leave periods,
- the salary as well as overtime payments,
- accommodation,
- insurance.

Cost of Labour

Minimum Wage: LYD 250 per month (source: ILO, 2011).
Average Wage: The average monthly gross earnings is LYD 190.
Social Contributions: Social Security Contributions Paid By Employers: 11.25%
Social Security Contributions Paid By Employees: 3.75%

Social Partners

Social Dialogue and Involvement of Social Partners: There is only one trade union in Libya that employees are allowed to join. This is the National Federation Of Unions, formed in 1972. Foreign workers are not allowed to form unions.
Labour Regulation Bodies: The Revolutionary Command Council (RCC)

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