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Estonia company formation and registration

According to the Estonian Commercial Code, there are six forms of companies in the Republic of Estonia. Foreign investors have the same rights and obligations as local entrepreneurs. All foreign investors can set up a company in the Republic of Estonia in the same way as local investors; no particular restrictions are imposed.

Before founding a company, it is important to examine and select the form of company that makes the most legal and economic sense for you. This choice affects not only the amount of equity required, but also the legal form of the company and other business-related issues.

The most popular types of legal entities formed by foreigners in Estonia are the so-called limited liability company (OÜ) and limited liability company (AS).

Limited Liability Company (OÜ) Joint Stock Company (AS) or Joint Stock Company General partnership (TÜ) and limited partnership (UÜ) Sole proprietorship (FIE) Branch of a foreign company It is mandatory to register the company in the Commercial Register of Estonia in order to start business and operate in Estonia.

Depiction Legal Baltic is able to draw up all necessary incorporation documents and represent your interests before the commercial register.

Limited Liability Company (OÜ) Equity capital

– when establishing a limited liability company, the minimum share capital is 2500 euros. The share capital contribution can be made in three different ways: Cash contribution (100% in cash). Disadvantage is your "money frozen" for 1 week. 100% contribution in kind. A contribution in kind can be a property or property right that can be valued in money and can be transferred to the stock corporation, to which a claim can be directed. An assessment by an auditor is required. more than half (1251 euros) in cash and the remaining (1249 euros) through a contribution in kind. In such a case, no expert opinion is required. The limited liability company in Estonia is not allowed to sell its shares to the public.

Founders – one or more persons can be founders or partners of a limited liability company and they can be both natural and legal persons. The founder may or may not be a resident of the Republic of Estonia.

Deeds of incorporation must be signed in front of a notary. All founders and board members must be present.

Status – a limited liability company is considered a legal entity.

Liability - the founder(s) or shareholders of a limited liability company are not personally liable for the liabilities of the company. The shareholder(s) of the company are liable for the debts and liabilities of the company to the extent of the respective contribution. A limited liability company is liable for the performance of its obligations with all of its assets.

Governing body – a company must have a board of directors which is a governing body of the limited liability company that represents and directs the limited liability company. The board consists of one or more directors; Directors can only be natural persons. A board member does not have to be a shareholder. At least 50% of the board members must be residents of the European Union, Switzerland, Norway, Iceland or Liechtenstein. A limited liability company must have a board of directors if the share capital exceeds EUR 25,000, the board of directors consists of fewer than three members or the articles of association of the limited liability company so require.

Accounting - monthly accounting is required in case the company has a VAT ID or regular payroll payments. Otherwise, it is sufficient to submit annual reports once a year, at the latest within 6 months after the end of the financial year.

Verification – always required if the share capital exceeds EUR 25,000, otherwise it is required if two of the following conditions are met:

Annual turnover exceeds about EUR 650 000; Total assets exceed EUR 330 000; The number of employees is 10 or more.

https://www.baltic-legal.com/estonia-company-formation-and-registration-eng.htm