Afghanistan Compliance Advisory
10 May 2015
Introduction. In continuation of our series, this issue discusses licensing, visas inside/outside Afghanistan and taxation. This information is only applicable to DoD or NATO non-Afghan prime or subcontractors in Afghanistan.
Business licensing. The procedures for obtaining 3-year business licenses from the Afghanistan Investment Support Agency (AISA) have now been approved, see http://ahg.af/aca/. The new process includes the option of obtaining an authenticated Power of Attorney, Board Resolution, Physical Presence Memo and Letter of Introduction in country at the Resolute Support (RS) Legal Office on base, significantly reducing the time required to obtain a business license. Eligible companies with existing 1-year business licenses can convert to a 3-year license at the time of renewal, if the contractor’s name appears on the list of contractors that has been provided by RS to AISA.
All DoD or NATO prime and subcontractors are required to obtain a business license by 1 June 2015. There are 10 items that are required for new applications; which can all be couriered to AHG in Kabul. The turnaround time is currently 4-6 business days after the documents have been authenticated. For assistance with obtaining, renewing or converting your business license, please email us at email@example.com.
Visas outside Afghanistan. The procedures for obtaining 1-year multiple entry visas at all Ministry of Foreign Affairs (MFA) Afghan Embassies and Consulates worldwide were approved 14 April 2015, see http://ahg.af/aca/. These procedures allow for group applications, do not require a work permit, clarify there are no penalties before 1 June 2015 and that the use of third party agents is allowed. Here are the only items required, if the contractor’s name is on the list of contractors that has been provided by RS to the MFA:
1. One visa application form
2. One passport size photo (attached to application form)
3. Original passport, valid for at least 6 months
4. Request letter from any senior representative of the contractor which provides a list of the contractor’s employees who are applying for visas (first name, last name, nationality, passport numbers) and the name of the agent who will drop off and pick up the passports
5. Official visa fees payment; which varies by applicant nationality and is equivalent to the corresponding fees charged by the applicant government to Afghan nationals under reciprocity agreements. In addition, $200 is charged only for the first time the applicant applies for such a visa.
AHG’s partners offer visa processing services at two locations outside Afghanistan:
A. Washington, DC. The Embassy of Afghanistan in Washington, DC has long been providing 1-year multiple entry visas. However, please note that as of the date of this advisory, only U.S. citizens are allowed, the visa applications must be notarized, and the applicants must be physically present inside the United States during the time of application. The Embassy has blanket denied all applications from contractors after contacting a few of the employees and learning that they were in Afghanistan. The 5 items numbered above can be couriered to AHG in DC; turnaround time is currently 2-3 weeks and increasing.
B. Abu Dhabi, UAE. The Embassy of Afghanistan in Abu Dhabi, UAE started providing 1 year multiple entry visas on 5 May 2015. Any nationality is allowed as long they have the appropriate documentation described above, the visa applications do not need be notarized, and the applicants do not need be physically present in the UAE during the time of application. The 5 items numbered above can be couriered to AHG in Dubai; turnaround time is currently 1-2 business days.
Visas inside Afghanistan. The procedures for obtaining 1-year multiple entry visas at the Ministry of Interior (MOI) Central Passport Department (CPD) have long been approved, see http://ahg.af/aca/. In addition to the 5 items numbered above (although the visa fee is fixed at $360 per application for all nationalities, plus the $200 one-time, total $560 per visa), the MOI also requires:
6. Valid AISA business license of the contractor, which should match the contractor’s name on the list of contractors that has been provided by RS to the MOI
7. Copy of the front and back of the military ID badge of the employee (albeit not the approved procedures)
8. One of the following four documents that serve as verification of a contractor employee eligibility:
For U.S. Contractors: Submit a DoD-issued Letter of Authorization (LOA) for each employee applying for a visa. Letter of Authorization is generated by the DoD SPOT system.
For NATO Contractors under the NATO Support Procurement Agency (NSPA): Submit a NATO Letter of Affiliation (LOA) for each employee applying for a visa. Letter of Affiliation template is available from NSPA.
For NATO Contractors under the NATO Communications and Information Agency (NCIA): Submit a NATO Letter of Affiliation (LOA) for each employee applying for a visa. Letter of Affiliation template is available from NCIA.
For Other NATO Contractors Not Listed Above: U.S./NATO Contractors may submit a contractor certificate for each employee applying for a visa, issued by the Resolute Support Legal Advisor/U.S. Forces – Afghanistan Staff Judge Advocate office in Kabul.
AHG offers visa processing services at two locations inside Afghanistan:
A. At the Airport. Visa exemptions are only valid until 1 June 2015. All international passengers arriving or departing Afghanistan thereafter via any military or commercial airport should have an Afghan visa. It has been discussed that those arriving without a visa may be provided a 15 day stamp within which period a visa must be obtained. Those that are departing without a visa may have their passports sent to MFA to get an exit visa, for which then need to pay penalties accruing from 1 June 2015: $10/day for the first month, $15/day for the second and $20/day and deportation the third month. On the commercial side of Hamid Karzai International Airport, there is a new MFA Consular Office, which can provide a 30-day visa to arriving passengers, but only with prior MOI and MFA approval. Once in country, the individual may apply for a 1-year multiple entry visa at the MOI (see below). The 8 items numbered above can be couriered to AHG in Kabul; turnaround time is currently 4-5 business days.
B. At the Ministry of Interior. The majority of BSA visas are expected to be processed at the MOI in Kabul. Please note that the MOI often requests items that are not in the agreed procedures, such as: Interpol sign-off, letter of introduction from NATO, emailed approval from NATO, license copy of courier, copy of contract between courier and contractor, physical presence of applicant, copy of the military prime contract and more. However, these items should not be provided without the express consent of the RS Legal Office. Only the 8 items numbered above should be couriered to AHG in Kabul; turnaround time is currently 1-3 business days.
Taxation. The following steps are required to maintain compliant in Afghanistan, even if all of a contractor’s contracts are tax exempt. Each step is a prerequisite for the next: 1) business license issuance with tax identification number, 2) Afghan landlord/employee/vendor tax withholding, 3) tax exemption confirmation for each contract, attached to annual income tax returns, 4) annual tax clearance letter, and 5) business license renewal. The MOF still has not granted international subcontractor tax exemptions afforded in the BSA, particularly on revenue received before 1 Jan 2015; however, there are political discussions ongoing. The MOF currently does not accept redacted contracts when applying for tax exemption confirmations, however, there is an effort to change this. Regarding the US Embassy/SDDC stamp required on contractor officer letters and contracts, there is an effort to have Legal Offices on base in Afghanistan place the stamp, instead of going through the US Embassy/SDDC. For assistance with taxation in Afghanistan, please email us at firstname.lastname@example.org.