Investing in Andorra can offer attractive opportunities for entrepreneurs, private investors and international companies. However, obtaining foreign investment authorisation involves much more than completing an application form and demonstrating financial capacity.
Every investment application represents a project that needs to be clearly explained, properly structured and supported by appropriate documentation.
Who is making the investment? Where do the funds come from? What is the purpose of the transaction? What business activity will be carried out in Andorra?
These are essential questions when preparing a well-organised and consistent foreign investment application.
At NEXORY GROUP, we believe that successful preparation begins long before an application is submitted to the Andorran authorities.
1. What Is Considered Foreign Investment in Andorra?
Andorran legislation regulates investments made by individuals and legal entities that meet the conditions established under the country's foreign investment framework.
Such transactions may include establishing an Andorran company, acquiring shares in an existing business or undertaking certain real estate investments.
The legal framework was amended by Law 5/2025 of 6 March, on Sustainable Growth and the Right to Housing, together with the Foreign Investment Regulation of 9 April 2025.
The legislation primarily distinguishes between foreign direct investment and foreign real estate investment.
Not all transactions are subject to the same procedures. Whether prior administrative authorisation is required depends on the nature of the investment and the circumstances established by law.
The first step is therefore to determine how the proposed transaction should be classified under Andorran legislation.
2. Who Is the Actual Investor?
One of the first matters to clarify is the identity of the individual or entity making the investment.
When the investor is an individual, the application should accurately reflect their identity and the circumstances relevant to the transaction.
If the investment is made through a foreign company, it may be necessary to explain its ownership structure and provide supporting corporate documentation.
Where several companies are involved, particular attention should be given to identifying the persons exercising control and the ultimate beneficial owners.
This information helps establish a clear understanding of the transaction and ensures consistency between the documents submitted.
A well-prepared application should clearly explain who is investing, through which structure and for what purpose.
3. Source of Funds: An Essential Part of the Process
Demonstrating the investor's financial capacity and documenting the origin of the resources used to finance a transaction are important considerations when preparing many investment projects.
It is essential to distinguish between two concepts.
Financial capacity: having sufficient resources to carry out the proposed investment.
Source of funds: being able to explain and substantiate how the money intended to finance the investment was obtained.
For example, an investor may own substantial assets, including real estate, company shares and financial investments.
However, a significant net worth does not necessarily mean that the investor has immediate access to the cash required for a particular transaction.
Similarly, projected future income should not be presented as funds that are already available.
Depending on the transaction and the applicable verification requirements, supporting documentation may include:
Bank statements and bank certificates.
Tax returns and tax assessments.
Company financial statements.
Evidence of dividend distributions.
Agreements relating to the sale of assets or shares.
Documentation supporting savings or professional income.
Information about ownership interests in other companies.
The documentation should provide a clear picture of the investor's financial position and the proposed financing arrangements.
It is also important to distinguish the administrative foreign investment authorisation process from the due diligence procedures carried out by banks and other entities subject to anti-money laundering obligations.
These are separate processes and may involve different documentary requirements.
4. Ensuring Consistency Between Assets and the Proposed Investment
An application may contain extensive documentation and still raise questions because of inconsistencies.
Consider an investor who declares total assets worth €600,000 and intends to invest €300,000 in Andorra.
The value of those assets alone does not establish that €300,000 is immediately available in cash.
It is necessary to distinguish between bank deposits, financial investments, company shares, real estate and other assets.
The investor should also be able to explain how the proposed transaction will actually be financed.
Financial information must remain consistent throughout the documentation.
Before submitting an application, it is advisable to review the amounts, dates, ownership percentages and explanations provided in the different supporting documents.
The strength of an investment application does not depend on the number of documents submitted, but on the clarity and consistency of the information they contain.
5. What Business Activity Will Be Carried Out in Andorra?
When an investment involves establishing or acquiring an interest in an Andorran company, the business project may be particularly relevant.
Simply stating an intention to incorporate a company is not always sufficient to explain the proposed activity.
A clear business presentation should describe what the company intends to do, which customers it will serve, how it will operate and what resources it will require.
Depending on the nature of the transaction, a business dossier may include:
A description of the business activity and services offered.
The professional background of the project promoter.
An overview of the target market.
The proposed business model.
The initial investment required.
Operational and organisational needs.
Reasoned financial projections.
The planned organisation of business activities in Andorra.
Financial forecasts should be based on reasonable assumptions and clearly identified as estimates rather than guaranteed results.
The applicable legislation also provides for obligations relating to genuine economic activity in certain circumstances involving companies with foreign direct investment.
For this reason, the proposed business should reflect a credible and genuine economic project.
6. What Happens if the Authorities Request Additional Documentation?
During the review of a foreign investment application, the Andorran authorities may request clarification or additional supporting documents.
Such a request does not necessarily mean that the application will be rejected.
The authorities may need to clarify a financial figure, obtain further information about a company, understand a particular transaction or review the proposed financing structure.
The applicable regulations establish decision-making deadlines and provide for the suspension of those deadlines while requested additional information is outstanding.
It is therefore important to respond within the specified period and provide clear explanations supported by appropriate evidence.
A structured and comprehensive response can make the application easier to assess.
7. How Long Does Foreign Investment Authorisation Take?
Under the Foreign Investment Regulation, the general maximum period for deciding an application requiring prior authorisation is two months.
This period may be extended by an additional month in the circumstances provided for by the regulations.
Furthermore, the time limit may be suspended when the authorities request additional information or documentation, until the requested material is received.
It is important to understand that the absence of an express decision within the applicable legal period does not result in automatic approval. The framework provides for negative administrative silence.
Once authorisation has been granted, the applicable deadlines for formalising the investment must also be respected.
Careful coordination between the administrative, banking, corporate and notarial stages is therefore advisable.
8. Common Mistakes When Preparing a Foreign Investment Application
Several avoidable mistakes can complicate the preparation of a foreign investment project in Andorra.
Providing inconsistent financial figures. Amounts declared in the application should match the supporting documentation.
Confusing net worth with available cash. Owning valuable assets does not necessarily mean having immediate access to sufficient funds.
Failing to explain the corporate structure. Where several companies are involved, their respective roles and ownership relationships should be clearly documented.
Submitting unsupported financial projections. Forecasts should be based on realistic and reasonable assumptions.
Providing documents without sufficient explanation. Supporting evidence should be accompanied by enough context to make the information understandable.
Overlooking banking due diligence. Administrative authorisation and opening a bank account are separate procedures, each with its own requirements.
Leaving preparation until the last minute. Obtaining certificates and corporate documents from other countries can take time.
9. Why a Well-Prepared Investment Dossier Matters
A properly organised application should make the proposed transaction understandable from the outset.
Corporate documentation, financial information, the business presentation and the investor's declarations should form a coherent and consistent package.
Before submission, it is advisable to verify that:
The investor's identity and ownership structure are properly documented.
The proposed transaction is clearly defined.
The financing arrangements are adequately explained.
Financial figures are consistent across all documents.
The business project is presented in sufficient detail.
Any additional authorisations and subsequent procedures have been identified.
Thorough preparation does not guarantee approval, as the final decision rests with the competent authorities.
However, it can help ensure that the application is presented clearly and reduce avoidable administrative difficulties.
NEXORY GROUP: Supporting Foreign Investment Projects in Andorra
At NEXORY GROUP, we assist entrepreneurs, private investors and international companies wishing to establish or develop business activities in the Principality of Andorra.
Our services include the preliminary assessment of investment projects, preparation and review of supporting documentation, organisation of the investment dossier and follow-up of the relevant administrative procedures.
We also help coordinate the different stages of the process, from foreign investment applications to the corporate and notarial formalities required for each transaction.
We pay particular attention to projects involving international corporate structures, multiple financing sources or complex financial documentation.
Every investment has its own characteristics. That is why we favour a personalised approach based on understanding each investor's circumstances and objectives.
Are you considering investing in Andorra or establishing a company with foreign capital?
Contact NEXORY GROUP to discuss your project.
Our team can assist you in assessing the proposed transaction and preparing a documentary and administrative strategy tailored to your circumstances.
NEXORY GROUP — Supporting your investment and business projects in Andorra.
This article was prepared for informational purposes in October 2026. Legislation, documentary requirements and administrative procedures may change. Each investment should be assessed individually in accordance with the applicable legal framework.