Ease of Doing Business in


Palau Download Profile (1698.5KB, pdf)
Region East Asia & Pacific
Income Category Upper middle income
Population 21,291
GNI Per Capita (US$) 12,180
City covered Koror



DB 2017 Rank



DB 2017 DTF (% points)

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Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 136 135 down
53.81 53.78 down
Starting a Business 120 114 down
81.95 81.85 up
Dealing with Construction Permits 98 94 down
68.38 68.39 down
Getting Electricity 138 141 up
54.84 54.81 up
Registering Property 44 44
75.16 75.11 up
Getting Credit 82 78 down
50.00 50.00
Protecting Minority Investors 179 181 up
28.33 28.33
Paying Taxes 118 114 down
64.65 64.65
Trading across Borders 163 163
46.22 46.22
Enforcing Contracts 126 126
52.21 52.21
Resolving Insolvency 166 166
16.38 16.28 up

DB 2017 Rank:


DB 2016 Rank:


Change in Rank:


DB 2017 DTF (% points):


DB 2016 DTF (% points):


Change in DTF (% points):


Legal form Private Limited Liability Company
Paid-in minimum capital requirement USD 1,000
City Koror
Indicator Palau East Asia & Pacific OECD high income
Procedure – Men (number) info_outline 8 7.0 4.8
Time – Men (days) info_outline 28 23.9 8.3
Cost – Men (% of income per capita) info_outline 2.9 19.0 3.1
Procedure – Women (number) info_outline 8 7.1 4.8
Time – Women (days) info_outline 28 23.9 8.3
Cost – Women (% of income per capita) info_outline 2.9 19.0 3.1
Paid-in min. capital (% of income per capita) info_outline 7.7 12.3 9.2
  • No. Procedure Time to Complete Associated Costs

    Deposit the legally required capital in a bank and obtain deposit evidence

    Agency: Commercial Bank

    Under the Money Laundering and Proceeds of Crime Act of 2001, a corporate bank account cannot be opened until incorporation documents are issued. Accordingly, the incorporator must first either open an account in his name or deposit the initial capital in the trust account of his attorney for the corporation. Incorporators must obtain proof of payment in the form of a bank statement, receipt, or other documentation of the amount paid into the company as paid-in capital.

    1 day no charge

    Check the uniqueness of the proposed company name and reserve a name

    Agency: Corporate Registrar

    The uniqueness of the proposed company name can be checked over the phone. The Corporate Registrar at the Office of the Attorney General searches the name index. In practice, few incorporators search for a company name before incorporating. Because Palau has no trademark statute, there are limited avenues for enforcement.

    1 day no charge

    Notarize the company deeds

    Agency: Notary

    Section 2.1 of the Corporations Regulations for the Republic of Palau requires that “any number of persons not less than three desiring to form a corporation shall execute articles of incorporation and acknowledge the same before a Clerk of the Supreme Court of the Republic or a notary public.” Attorneys generally prepare the incorporation documents. If professional services are used, this adds USD 1,000 to the process.

    The articles of incorporation must contain (a) the company name; (b) place; (c) purpose; (d) shares; (e) directors; (f) duration; (g) incorporators; (h) voting; (i) disposition; (j) liquidation; (k) amendments; (l) ownership, and (m) foreign ownership.

    A shareholder affidavit must be notarized and set forth the following: (a) the number of authorized shares of each class; (b) the par value of the shares; (c) the names of subscribers for shares of each class; (d) the number of shares of each class subscribed to by each subscriber; and (e) the subscription price or prices for the shares of each class subscribed.

    1 day USD 10

    Pay the registration fee at the National Treasury

    Agency: National Treasury

    Payment of the registration fee is done at the National Treasury.

    1 day USD 250

    Register the company with the Corporate Registrar at the Office of the Attorney General; obtain a certificate of incorporation

    Agency: Corporate Registrar

    The time between when the company submits the documents to the Corporate Registrar to when the Office of the President issues the charter is about 2 weeks. This time varies, however, depending on (a) how long charter issuance takes once the OCR approves the documents; (b) if there are errors in the corporate documents; and if so, (c) the time required to correct any errors.

    14 days included in previous procedure

    Register employees for social security and obtain an employer identification number (EIN)

    Agency: Social Security Administration

    Companies must register with the Office of Social Security for payment of social security tax withheld from employees. All employers or self-employed persons doing business in Palau must apply for an employer identification number (EIN) from the Social Security Administration. The applicant completes the Application for Employer Number form and pays the applicable fee (USD 15 for first-time employers, USD 10 for renewing employers). The Palau Social Security Administration will assign the applicant an employer identification number (EIN), which must be entered on the employer's quarterly tax returns. The EIN is required to apply for a business license from the Division of Revenue and Taxation.

    1 day USD 15

    Apply for a business license from the relevant licensing authority

    Agency: Division for Revenue and Taxation

    Before a person or a firm engages in business, they must apply for a business license from the Division of Revenue and Taxation, State Government. Previously, companies were licensed by entity, but starting in 2007, companies must obtain a license for each establishment (store).

    5 days USD 50

    Apply for a business license from the state government

    Agency: State government

    The Koror state government requires a state business license. The following license fees apply:
    - USD 50: For each retail store (Class A), movie theater, building contractor, furniture manufacturer, and boat building and repair shop association or corporation.
    - USD 40: For each scrap-metal-collecting business.
    - USD 30: For each retail store (Class B) and each non-associated or non-incorporated boat building and repair shop.

    Other classes and their respective fees apply to other businesses

    4 days on average USD 50, depending on numbers and types of licenses