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13.2. Thin-capitalization and other Restrictions to Interest Deduction

There are no specific thin-capitalization rules in Equatorial Guinea but limits on the deductibility of interest expense exist.

Interest paid in excess of the following thresholds is not deductible:

  • Interest paid to the shareholders for amounts made available to the company, in addition to their capital contributions, in excess of the interest rate for advances by the central bank (currently 3.25%); and
  • Interest paid on the portion of loans granted  by shareholders, that is in excess of one-half of capital stock, where the shareholder participates in the management of the company.