Table of Contents
- Executive Summary: Key Legal Developments in Kiribati
- Overview of Kiribati’s Legal System and Business Law Framework
- Recent Legislative Changes Impacting Businesses (2024–2025)
- Business Registration and Corporate Structures
- Taxation Laws and Compliance Requirements
- Employment, Labor, and Immigration Regulations
- Intellectual Property Protection and Enforcement
- Foreign Investment Laws and Restrictions
- Dispute Resolution: Courts, Arbitration, and Enforcement
- Outlook 2025–2029: Predicted Reforms and Strategic Opportunities
- Sources & References
Executive Summary: Key Legal Developments in Kiribati
In 2025, business law in Kiribati continues to evolve in response to both domestic priorities and the country’s international obligations. Recent legal reforms focus on enhancing the ease of doing business, strengthening regulatory compliance, and fostering economic resilience amid climate and global market challenges. The Companies Ordinance remains the principal legislation governing company formation, operations, and dissolution. Amendments in recent years streamline company registration and clarify director responsibilities, supporting investor confidence and transparency.
The government has prioritized anti-money laundering (AML) and combating the financing of terrorism (CFT) compliance, in line with the commitments under the Financial Action Task Force and the Kiribati Financial Intelligence Unit. Businesses are now required to implement stricter customer due diligence processes, report suspicious transactions, and maintain detailed records. This strengthens the country’s reputation and access to international financial systems.
Foreign investment regulations, governed by the Foreign Investment Act, have seen renewed attention, with the Ministry of Finance and Economic Development clarifying sectoral restrictions and streamlining approval processes. These measures, coupled with the establishment of a single-window system for business licensing, are designed to reduce red tape and attract investment, especially in fisheries, tourism, and renewable energy sectors.
Labour law reforms under the Employment and Industrial Relations Code continue to protect worker rights while allowing flexible workforce arrangements. The Ministry of Employment and Human Resource has issued updated guidelines on contracts, occupational safety, and dispute resolution, reflecting Kiribati’s commitment to international labour standards.
Statistically, the Kiribati National Statistics Office reports a gradual increase in registered businesses, with a notable 8% rise in new registrations in the last fiscal year. This indicates growing entrepreneurial activity, particularly among micro and small enterprises.
Looking ahead, digitalization of regulatory processes, continued AML/CFT enhancements, and ongoing labour reforms are expected to shape the business law landscape. These trends aim to foster a more transparent, competitive, and resilient business environment, supporting sustainable economic growth in the face of ongoing climate and market risks.
Overview of Kiribati’s Legal System and Business Law Framework
Kiribati’s legal system is primarily based on English common law, complemented by local statutes and customary law. The principal legislation shaping business operations includes the Companies Ordinance (Cap. 10), the Business Names Registration Act 2011, and the Foreign Investment Act 1985. The judiciary, comprising the High Court and subordinate courts, is the central authority for interpreting and enforcing business law provisions. In recent years, the government has signaled intentions to modernize its commercial legal framework to better facilitate investment and economic diversification, aligning with national development objectives outlined in the Kiribati 20-Year Vision 2016–2036 (KV20).
All businesses, whether domestic or foreign, must register with the Ministry of Finance and Economic Development (MFED). The Ministry oversees company incorporation, business name registration, and compliance with tax and regulatory obligations. Foreign investors require approval from the Ministry of Commerce, Industry and Cooperatives (MCIC) under the Foreign Investment Act, which sets out sectoral restrictions and approval processes. There is an ongoing review of foreign investment rules, with expected reforms in 2025 to streamline approval processes and reduce administrative barriers to entry.
Key compliance requirements for businesses include annual filing of financial statements, timely tax payments under the Income Tax Act, and adherence to labor laws as enforced by the Ministry of Employment and Human Resources. The government is also strengthening anti-corruption and anti-money laundering controls, in line with commitments to the Financial Action Task Force recommendations. As of 2024, Kiribati has improved its business registration process, typically allowing company formation within 10–15 business days. However, challenges persist in contract enforcement and access to dispute resolution mechanisms, as identified by the Kiribati Judiciary.
Statistical data from the MFED shows a gradual rise in business registrations, with over 100 new entities registered annually since 2022. The majority of businesses operate in retail, fishing, and services, while foreign investment remains concentrated in fisheries and tourism. Looking ahead to 2025 and beyond, the outlook for business law in Kiribati is cautiously optimistic. Policy reforms are expected to enhance transparency, investor protection, and regulatory efficiency, though infrastructure and institutional capacity constraints may continue to impact the pace of progress.
Recent Legislative Changes Impacting Businesses (2024–2025)
In 2024 and into 2025, Kiribati has seen several noteworthy legislative and regulatory developments affecting its business landscape. The government, under its ongoing commitment to economic modernization and transparency, has focused on reforms to company registration, anti-money laundering (AML) compliance, and investment facilitation.
One of the most significant changes is the continued implementation of the Companies Act 2017, which was designed to streamline the incorporation process and clarify directors’ duties and shareholder rights. In 2024, the Ministry of Finance and Economic Development updated registration procedures to allow for more efficient digital submissions, aiming to reduce processing times for new business entities by up to 30%. This initiative is expected to encourage both domestic and foreign investment through reduced bureaucratic barriers.
In the area of anti-money laundering, Kiribati has taken steps to align its practices with international standards, as part of its obligations under the Asia/Pacific Group on Money Laundering (APGML). Amendments to the Anti-Money Laundering and Counter Terrorism Financing Act 2009 were introduced in late 2024, strengthening reporting requirements for financial institutions and designated non-financial businesses. These amendments, overseen by the Ministry of Justice, include more robust customer due diligence and suspicious transaction reporting, with penalties for non-compliance.
Taxation remains relatively straightforward in Kiribati, with the Kiribati Revenue Board maintaining an annual corporate tax rate of 25%. For 2025, small business tax thresholds and compliance procedures were further clarified to assist micro and small enterprises, a sector that comprises over 80% of registered businesses in the country. The government also continues to streamline Value Added Tax (VAT) collection, focusing on digital record-keeping and compliance audits.
Looking ahead, Kiribati is expected to pursue additional legislative reforms to attract foreign direct investment, particularly in fisheries, tourism, and renewable energy. Ongoing collaboration with the Ministry of Finance and Economic Development and international partners suggests that further regulatory adjustments—such as simplified licensing and enhanced dispute resolution mechanisms—may be enacted by 2026.
Overall, these legislative changes indicate a drive toward greater legal certainty, compliance with global standards, and a more attractive business environment for both local entrepreneurs and overseas investors.
Business Registration and Corporate Structures
Business law in Kiribati is primarily governed by the Companies Ordinance (Cap. 10A), which outlines the legal framework for the registration and operation of companies. The Ministry of Finance and Economic Development (MFED) is the key regulatory authority overseeing business registration and compliance. In recent years, the government has sought to modernize its commercial legal framework to foster economic growth and attract foreign investment.
To register a business in Kiribati, applicants must submit required documentation to the Registrar of Companies under MFED. The process includes reserving a company name, submitting the memorandum and articles of association, and paying applicable fees. As of 2025, reforms are underway to streamline registration, with plans to introduce digital processes and reduce bureaucratic hurdles. The anticipated outcome is improved efficiency and lower costs for new businesses, aligning with regional best practices.
Corporate structures permitted in Kiribati include private companies, public companies, and partnerships. The most common form chosen by local and foreign investors is the private company limited by shares, due to its flexible governance and limited liability protection. Partnerships are also recognized, though they are less common due to unlimited liability of partners. The law requires at least one director and one shareholder for a private company, and annual filings to maintain good standing.
Compliance obligations are enforced by MFED, with annual return filings, disclosure of beneficial ownership, and maintenance of proper accounting records as core requirements. Failure to comply may result in penalties, deregistration, or restrictions on doing business. In 2024, the government enhanced oversight of anti-money laundering (AML) and counter-terrorism financing (CTF) measures, requiring companies to update ownership information and cooperate with due diligence requests from authorities (Ministry of Finance and Economic Development).
Statistically, Kiribati remains a small market, with fewer than 300 active registered companies as of late 2024. Growth is expected in the fisheries, tourism, and renewable energy sectors, in line with government economic diversification goals. The outlook for 2025 and beyond is cautiously optimistic, as legislative reforms and digitization are projected to improve the ease of doing business and attract new investors to Kiribati’s emerging market (Ministry of Finance and Economic Development).
Taxation Laws and Compliance Requirements
Kiribati’s taxation framework is primarily governed by the Income Tax Act (Cap. 41), the Value Added Tax Act 2013, and supporting regulations. The Ministry of Finance and Economic Development is the main authority overseeing tax administration, collection, and policy enforcement. All businesses operating in Kiribati—local and foreign—are subject to these laws and must register with the Kiribati Taxation Division before commencing operations.
As of 2025, the principal business taxes in Kiribati are:
- Corporate Income Tax: Companies are taxed at a flat rate of 25% on profits, while non-resident companies are taxed at a rate of 30% for income derived from Kiribati sources.
- Value Added Tax (VAT): Standard VAT is levied at 12.5% on most goods and services supplied in Kiribati or imported into the country. Businesses with annual turnover above the threshold (currently AUD 40,000) must register for VAT.
- Withholding Tax: Dividends, interest, and royalties paid to non-residents are generally subject to a 10% withholding tax, unless reduced by an applicable tax treaty.
Compliance obligations require periodic filing of tax returns (typically annually for corporate income tax and monthly for VAT). Businesses must maintain accurate accounting records, submit timely returns, and make payments through the government’s approved channels. The Taxation Division provides electronic tax filing and payment options, though digital infrastructure remains limited in outlying islands.
Kiribati continues to strengthen tax compliance, supported by capacity-building projects and digitalization efforts in cooperation with regional partners. In 2023-2024, the government has increased audits and taxpayer education, aiming to improve the national tax-to-GDP ratio, which was estimated below 15% in recent years according to the Ministry of Finance and Economic Development. Efforts to align tax practices with international standards are ongoing, including commitments to anti-money laundering (AML) and countering the financing of terrorism (CFT) obligations under the Financial Supervisory Commission.
Looking ahead to 2025 and beyond, Kiribati is expected to roll out further reforms to broaden the tax base, improve collection efficiency, and incentivize formalization in the private sector. Businesses should monitor updates from the Ministry of Finance and Economic Development for changes to rates, filing requirements, and compliance initiatives, as authorities pursue domestic revenue mobilization and regulatory modernization.
Employment, Labor, and Immigration Regulations
Kiribati’s employment, labor, and immigration regulations form a crucial pillar of its business law environment, influencing both domestic enterprises and foreign investors. The legal framework governing employment relations is primarily codified in the Employment Ordinance, which outlines the rights and responsibilities of employers and employees. This ordinance establishes standards regarding contracts, termination, working hours, wages, leave entitlements, and dispute resolution mechanisms. The government, through the Ministry of Employment and Human Resources, actively oversees compliance and updates to labor regulations.
Recent years have seen incremental reforms aimed at strengthening worker protections and improving labor market flexibility. As of 2025, the minimum wage remains under periodic review, and there is ongoing dialogue about aligning local standards with international labor conventions, reflecting Kiribati’s commitments as a member of the International Labour Organization (International Labour Organization).
- Employment Contracts: Written contracts are required, stipulating job descriptions, remuneration, working hours, and termination conditions. Employers must provide proper notice or compensation upon termination, except in cases of serious misconduct.
- Workplace Standards: The law prescribes maximum working hours and mandates rest days. Provisions for annual leave, sick leave, and maternity leave are stipulated, with enforcement supported by labor inspections.
- Dispute Resolution: The Employment Ordinance sets out procedures for handling grievances, with the Labour Office facilitating mediation and, if necessary, referral to the courts.
On the immigration front, the Kiribati Immigration Division regulates the entry and employment of foreign nationals. Work permits are mandatory for non-citizens seeking employment, requiring sponsorship by a registered local entity and compliance with sector-specific quotas or skills assessments. The government is exploring digitalization of immigration processes to streamline applications and monitoring, with pilot initiatives planned for late 2025.
Key statistics indicate that as of 2024, formal sector employment remains concentrated in public administration, education, and fisheries, with private sector employment gradually expanding due to government-driven economic diversification (Ministry of Finance and Economic Development). However, compliance challenges persist in the informal sector, prompting targeted awareness and enforcement campaigns.
Looking ahead, Kiribati’s employment and immigration regulations are expected to evolve in response to economic modernization, climate-induced migration pressures, and international best practices. Businesses operating in Kiribati should closely monitor regulatory updates and ensure robust compliance systems to mitigate legal risks and capitalize on emerging opportunities in the local labor market.
Intellectual Property Protection and Enforcement
Intellectual property (IP) protection in Kiribati remains an emerging area within the broader context of business law, reflecting both the country’s developmental priorities and ongoing efforts to align with international standards. As of 2025, Kiribati’s legal framework for intellectual property is primarily governed by the Trademarks Act 1938 (Revised Edition 1977) and the Copyright Act 2000. These statutes provide the basis for the registration and enforcement of trademarks and copyrights, respectively, but the scope of IP protection is relatively limited compared to more developed jurisdictions.
Kiribati is not currently a member of the World Intellectual Property Organization (WIPO) or a signatory to major international IP treaties such as the Paris Convention or the Berne Convention. This limits the automatic recognition and protection of foreign IP rights within Kiribati and can present challenges for international businesses seeking to operate in or from Kiribati World Intellectual Property Organization. The government, through the Ministry of Foreign Affairs and Immigration, has indicated an intention to explore accession to international agreements to enhance the IP regime, but progress remains gradual.
Enforcement mechanisms, including the role of the judiciary and relevant administrative bodies, are still developing. Court cases involving IP disputes are rare, reflecting both the modest scale of commercial activity and limited public awareness of IP rights. The Judiciary of Kiribati handles IP enforcement under general civil procedure, but there are few specialized resources or personnel dedicated to IP matters.
Compliance with existing IP laws is largely voluntary and depends on individual and business initiatives to register and maintain their rights. The number of registered trademarks and copyrights remains low, with only a handful of applications processed annually by the government. This is in line with Kiribati’s small private sector and limited number of foreign direct investments.
Looking ahead to 2025 and the subsequent years, the outlook for intellectual property protection and enforcement in Kiribati is cautiously optimistic. There is growing recognition—especially among local entrepreneurs and SMEs—of the importance of IP for economic development, innovation, and access to global markets. Ongoing technical assistance and capacity-building programs, often facilitated by regional organizations and donor partners, are expected to gradually strengthen the legislative and institutional framework. However, substantive changes, such as accession to international IP treaties or the establishment of a dedicated IP office, are likely to be realized over the medium to long term.
Foreign Investment Laws and Restrictions
Kiribati’s foreign investment regime is governed primarily by the Foreign Investment Act 1985 and its subsequent amendments. The Act outlines the framework for the entry and operation of foreign investors within the country, aiming to balance economic development with the safeguarding of national interests. The Foreign Investment Commission (FIC), operating under the Ministry of Commerce, Industry and Cooperatives, is responsible for regulating and approving all foreign investments.
Foreign investors must apply for and obtain a Foreign Investment Certificate (FIC) before commencing business activities. The application process requires detailed disclosure of the nature of the business, ownership structure, financial projections, and intended location of operations. The FIC retains the authority to approve, reject, or impose conditions on foreign investment proposals, particularly in sectors critical to public welfare, national security, or environmental protection (Ministry of Commerce, Industry and Cooperatives).
Certain sectors are reserved for citizens or subject to restrictions for non-citizens. These include small-scale retail, passenger transport, and certain fisheries operations, as outlined in the Schedule of Reserved Activities periodically updated by the government. Additionally, land tenure in Kiribati is governed by customary law; non-I-Kiribati investors cannot purchase land outright but may access land through lease arrangements, subject to government and landowner approvals (Ministry of Environment, Lands and Agricultural Development).
Compliance with local employment regulations, environmental standards, and regular reporting requirements is mandatory. The government continues to review its foreign investment laws to attract responsible investment, particularly in renewable energy, fisheries processing, and sustainable tourism. However, the approval process remains stringent to ensure alignment with Kiribati’s Sustainable Development Goals and to mitigate risks of exploitation or environmental degradation.
Kiribati has seen modest growth in approved foreign investments, with the FIC reporting a steady annual increase in applications, predominantly from the Asia-Pacific region. In 2023, foreign investment approvals contributed to approximately 4% of GDP, mainly in fisheries and services (Ministry of Finance and Economic Development). The outlook for 2025 and subsequent years anticipates gradual liberalization, with potential amendments to the Foreign Investment Act targeting streamlined approvals and enhanced investor protections, while maintaining controls in sensitive sectors.
Dispute Resolution: Courts, Arbitration, and Enforcement
In 2025, dispute resolution in Kiribati remains primarily rooted in its formal court system, with arbitration and alternative dispute resolution (ADR) mechanisms still in nascent stages of development. The judiciary consists mainly of the Magistrates’ Courts, the High Court, and the Court of Appeal, with the High Court having original jurisdiction over civil and commercial matters exceeding the lower courts’ monetary thresholds. The Kiribati Judiciary continues to play a central role in resolving business disputes, although limited judicial resources and geographic dispersion across numerous islands can result in delays and logistical challenges.
The country’s legal framework for commercial dispute resolution is primarily governed by the Civil Procedure Act 2003 and the High Court Act 2014. These laws set out procedures for filing claims, hearings, judgments, and appeals. Most business-related disputes are adjudicated through these statutory mechanisms. However, Kiribati has not yet enacted a modern arbitration law or adopted the UNCITRAL Model Law—a standard for commercial arbitration in many jurisdictions—nor is it a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. As such, enforceability of foreign arbitral awards remains uncertain and typically requires fresh proceedings in Kiribati courts.
Compliance with court procedures is mandatory, and failure to adhere may result in dismissal or adverse judgments. Enforcement of judgments is addressed via the High Court Act, which empowers the court to order execution against property, garnishment, or other remedies as appropriate. However, logistical challenges—such as limited court staff, distances between islands, and lack of digital infrastructure—may impede timely enforcement.
Statistical data on commercial disputes is limited, but anecdotal reports from the Ministry of Justice and the Kiribati Chamber of Commerce & Industry indicate a low but steady volume of formal business litigation, reflecting the small size of the private sector and a preference for informal resolution within communities. Nonetheless, as foreign investment initiatives and infrastructure projects expand, the complexity and frequency of commercial disputes are expected to grow modestly through 2025 and beyond.
Looking ahead, there is cautious optimism that Kiribati may gradually introduce more robust arbitration and ADR frameworks, especially as regional harmonization efforts and donor-supported legal reform initiatives gather pace. Businesses operating in Kiribati are advised to monitor legal developments closely and seek tailored legal advice to navigate the evolving dispute resolution landscape.
Outlook 2025–2029: Predicted Reforms and Strategic Opportunities
From 2025 to 2029, Kiribati is expected to continue its gradual efforts to modernize its business law framework in response to both domestic needs and international development obligations. The government’s ongoing partnership with multilateral agencies, such as the World Bank and Asian Development Bank, is likely to influence the pace and focus of legal reforms, particularly in the areas of business registration, investment, and corporate governance.
Recent years have seen the government’s commitment to improving the ease of doing business, as reflected in the implementation of the new Companies Act 2016, which streamlined company incorporation and reporting requirements. For 2025 and beyond, further amendments to the Companies Act, and possibly associated regulations, are anticipated to simplify compliance and facilitate foreign investment, in line with recommendations from international partners. The Ministry of Justice has indicated ongoing consultations regarding digitalization of company filings and the potential adoption of e-government services for business licensing.
Another area ripe for reform is insolvency law. Kiribati currently lacks a comprehensive insolvency regime, which has been identified as a barrier to commercial confidence and credit growth. Stakeholder dialogues led by the Ministry of Finance & Economic Development are expected to result in draft legislation by 2027, with the aim of aligning local standards with those of other Pacific Island economies.
Compliance remains a challenge due to limited administrative capacity and outdated processes. However, with the support of technical assistance programs and donor funding, Kiribati is poised to adopt risk-based approaches in regulatory oversight, particularly concerning anti-money laundering obligations and beneficial ownership transparency. The Financial Supervisory Commission is likely to introduce new guidance and periodic reviews to strengthen enforcement in the financial sector.
Key statistics, such as the number of registered businesses and time required for incorporation, are expected to improve modestly given these reforms. According to the Ministry of Finance & Economic Development, business registrations have grown by approximately 5% annually since 2022, a trend projected to hold as regulatory barriers are reduced.
In summary, while Kiribati’s business law reforms are expected to progress incrementally, the outlook for 2025–2029 indicates a more enabling environment for private sector growth, greater legal certainty for investors, and strategic opportunities in sectors such as fisheries, tourism, and digital services. Continuous monitoring and capacity building will be crucial to ensure effective implementation and compliance in the years ahead.
