The Commercial Code (Äriseadustik) establishes the legal activities of companies in Estonia. The business activities of a company start once it has been registered with the Commercial Register. Each company must be registered under a name that will contain the appendage referring to the legal form of the company. Also, there are certain forms of activities that require special licenses.
It suffices a person to start a private limited company. The Estonian private limited company has a capital formed by shares and is owned by one or more shareholders, that are not liable individually. The minimum amount to start a private limited company must be 2, 550 euros, and the minimum nominal value of a share must be 1 euro. The Estonian private limited company must have a management board formed by Estonian residents, although management board members do not need to be shareholders.
For more information regarding the establishment of an Estonian Limited Liability Company please watch the video below.
A legal or natural person is the minimum required to start a public limited company in Estonia. It needs a public share capital of 25, 500 euros with a minimum nominal share value of 1 euro. Its shareholders have no liability for the company’s legal obligations. Compared to the private company, the public company’s shareholder must be registered in the Estonian Central Register of Securities and it is required to have a management and supervisory board. The supervisory board is usually made up of 3 members, not necessarily shareholders but half of them must be EU residents. The supervisory board appoints and organizes the management.
If you want to open a company our Estonian lawyers can offer you the best legal advice.
The Estonian general partnership must be made of 2 or more partners and submits to the terms of the partnership agreement. Partners have joint and full liability for the obligations of the company. There is no minimum capital investment and the profits are divided amongst the partners according to their share, unless the agreement specifies otherwise.
The Estonian limited partnership must be made of at least a fully liable partner and is required to have a general partner and a limited partner. The general partner will be fully liable for the company’s legal obligations while the limited partner is liable up to his amount of investment.
A natural person has the possibility of being a sole proprietor but must register with the Commercial Register after submitting a notarized petition. The sole proprietor has full liability for the legal activities of the business.
A foreign company may open a branch office in Estonia. Branch offices must also register with the Commercial Register even if they are not a legal business and the parent company is liable for all the activities of the branch.
When registering with the Commercial Register a company must submit an application within 6 months from the foundation, the memorandum and articles of association, and a bank payment as evidence of the full payment of the share capital.
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