Distribution Channels

Tunisian law allows both wholesale and retail marketing by foreign businesses, but the government discourages new foreign investment in retail distribution for the domestic market. Most distribution and sales activity occurs in the major coastal cities, i.e., Tunis, Sfax, Sousse-Monastir, and Bizerte. There are a limited number of major grocery or consumer retail store chains and the first foreign supermarket chain will open in 2000 through a joint venture agreement. Tunisian pharmacies offer an alternative outlet for a broad range of personal care items.

Use of Agents and Distributors: Finding a Partner

Many Tunisian businesses are family-owned or -controlled. While they might welcome foreign investment in distributing or marketing ventures, Tunisian businesses often resist ceding any management control of existing enterprises to outsiders. Tunisian commercial law also contains provisions designed to protect minority shareholder interests that can give disproportionate influence to Tunisian minority partners. Distribution or marketing contracts should be very specific about financial obligations and performance measurements.

Direct Marketing, Sales Techniques

Direct marketing can offer certain advantages, however Tunisian business is still somehow dependent upon the establishment of personal relationships. Customers also expect access to after-sales service, and are sometimes reluctant to purchase new products, technologies, or brand names in the absence of a local representative. Direct marketing is probably best suited in the Tunisian market to low-technology consumer goods with a strong global (or at least European) buyer recognition.

Joint Ventures/ Licensing

There are several successful examples of Joint ventures in Tunisia. Common sense, however, must be exercised. As always Companies should be careful in selecting a partner. The joint venture agreement should also clearly establish a binding dispute settlement procedure acceptable to both parties.

Steps to Establishing an Office

Establishing or, more accurately, registering an office of a foreign company in Tunisia is a relatively simple task. The Foreign Investment Promotion Agency (FIPA) offers a "one stop shop" service to investors seeking to establish a business in Tunisia. Generally, it takes approximately two weeks to complete all the necessary work. Companies should get the advice of a local lawyer before starting the process. Many commercial lawyers have specialized staff who can handle the details with fipa or other ministries.

Firms contemplating this matter should be aware that this is only a first, albeit necessary, step toward commencing operations in the Tunisian market. Depending upon the type of commercial activity under consideration, firms may need to complete a wide range of regulatory, licensing, and logistical procedures before bringing their products or services to the market.

Foreign Investment Promotion Agency's simplified registration procedure is not available for all commercial activities. The following activities require prior approval from the relevant government agencies: fisheries, tourism, transportation, communications, education and training, film production, health, real estate development, machine-made carpets, waste treatment and recycling.

Sales Service / Customer Support

Tunisian consumers are becoming more accustomed to sales service, and have begun to expect a higher degree of customer support. The government has instituted measures to increase consumer protection, including a ministry of commerce-designed standard sales contract detailing the requirements of retail or manufacturer guarantees. In addition to providing technical instructions in Arab and French or English and providing verification of the proper functioning and good condition of the merchandise, the law includes a schedule of reimbursements to be made to the consumer if faulty merchandise cannot be adequately repaired within 15 days of notification from the consumer.

Selling to the Government

The Tunisian government makes the majority of its purchases from foreign suppliers through international tenders. These tenders are published widely in the local media; the larger tenders are sometimes disseminated in selected foreign journals as well.

Need for a Local Attorney

Foreign Firms interested in the Tunisian market should engage a reputable local attorney with experience in commercial affairs. Local attorneys can provide a broad range of important services and firms can often avoid hiring an additional local agent(s) for administrative or political matters.