What are the types of legal entities I can register in Estonia?
The five types of business recognized by the Estonian Commercial Code are the private limited company, the public limited company, general partnership, limited partnership and the sole proprietorship. The branches of the foreign companies are also following the regulations of the commercial code.
A private limited liability company (Osaühing or OÜ) is a form of business incorporated by at least one founder with a share capital of 40.000 EEK. The members are liable for the company’s debts only in the limit of their contribution to the capital. The constitutive documents of the private limited liability company are the memorandum of association and the articles of association. The management is assured by a management board with at least one member, which is not mandatory to be shareholder. If the capital is above 400.000 EEK, a supervisory board and an auditor must be appointed.
A public limited company (Aktsiaselts or AS) is formed by at least one person with a minimum share capital of 400.000 EEK. The liability of its members is limited by the contribution to the capital. The management of this type of business is assured by a management board, a supervisory board and an auditor. The highest decisions are taken by the general meeting of the shareholders.
The limited partnership (Usaldusühing or UÜ) is a form of business composed by two or more members, one or more persons, called general member(s), liable for the obligations of the entity with all their assets and one or more persons, called silent partner(s) liable for the obligations of the limited partnership to the extent of their contribution to the capital. The silent partner has no right to manage or represent the partnership. There is no minimum share capital required in order to establish this form of business.
A general partnership (Täisühing or TÜ) is formed only by general partners, liable with their personal assets for the entity’s debts. An agreement is signed between the partners. Just like in the case of the limited partnership, there are no requirements for a minimum share capital.
The sole proprietorships ( Füüsilisest Isikust Ettevõtja or FIE) are forms of business established by a single entrepreneur with no minimum share capital, based on a petition registered in the commercial register containing the name and field of activity of the business, the address of the business, the beginning and end of the financial year, the name, identification number and the address of the sole proprietor .Other information can be required.
What are the steps for incorporation of a company in Estonia?
There are only five procedures that have to be accomplished in one working week before starting the commercial activities by the legal entities. The registration of a company cannot be performed later than a year from signing the memorandum of association.
First of all, the name must be checked for uniqueness. The process can be performed online and if the name is available, a reservation can be made.
A bank account must be opened and the entity’s capital must be deposited. The bank must issue a certificate of deposit, necessary for the registration in the Commercial register.
The next step is submitting the notarized constitutive documents (the memorandum of association and articles of association-in case of the limited companies, agreements between the partners-in case of the partnerships, petition-in case of the sole proprietorship) and the certificate attesting the deposited capital at the Commercial Register.
For the legal entities with taxable supplies above 16.000 EUR (without import) in a year the registration for the VAT is mandatory. The necessary documents must be deposited at the National Tax Board. The applicant must provide information regarding the members of the company, the management board and the constitutive documentation of the company. The submission can be performed electronically in the Commercial Register system.
The last step of incorporation is the registration at the Central Sick Fund of Estonia. All the employees must be registered within a week from hiring.
What is the minimum share capital of an OU and an AS?
An Estonian private limited liability (OU) must deposit at registration 40.000 EEK, while a public limited liability company must deposit a minimum share capital of 400.000 EEK.
What documents are required for the incorporation of a company in Estonia?
A company must deposit the following for registration in the commercial register: if it’s a limited liability company must deposit the memorandum of association and the articles of association along with the receipt from the bank confirming that the minimum share capital was deposited, a partnership must deposit the agreement signed by the parties and the sole proprietor must deposit a petition regarding the incorporation of its business.
How quickly can I incorporate my company in Estonia?
A company can be incorporated in maximum one working week following five easy steps.
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