What is Company Registration in Finland?
Finland is a key target for international investors because of its economic stability and high-tech industrial base. In Finland anyone can set up business irrespective of their nationality but so long one of the company’s founding members is resident in the European Economic Area.
In case founder is a legal person, its domicile should be in an EEA country.
Note: EEA compromises all the EU countries with Iceland, Liechtenstein, Norway and Switzerland.
In Finland, laws are very encouraging for the investors who want to start a company (Example in the north, where local authorities have special interests to attract foreign investments).
Types of Entities
In Finland, Limited Company is established by at least one member with a minimum share capital of 2500 Euros (cash or assets) divided into shares. Under this, shares are not transferable to the public. In this type of company management is assured by at least one manager whereas the major decisions are taken by the general meeting of the shareholders.
In Finland, for large business, Public Limited Company is designed and it is founded by at least one statutory person with a minimum share capital of 80,000 EUR (cash or property). Management board must consist more than 3 members (more than 50% of them must be EEA residents) and a managing director in case capital is more than 80,000 EUR. The shares can be listed of this type of entity at the Helsinki Stock Exchange.
Requirements for a Public Limited Company
- Minimum three board directors with chief executive
- Usual to be listed in the Helsinki Stock Exchange
- Statutory requirement for audited accounts
- Corporate Tax rate is 26%
Requirements for a Private Limited Company
- At least one board director and a deputy
- Statutory requirement for audited accounts in case company has a turnover of more than €200,000, balance sheet total of more than €100,000, and 3 or more employees
- Flat Corporate Tax rate of 26%
In Finland, smallest form of business is the private Person or a private trader carrying on trade, in this, owner is not considered as separate entity from their business and will be liable with its own assets for the company’s debts. Specific business taxes must be paid by the owner and it’s free to withhold profit.
In Finland, General Partnership consists at least two members who are called as general partners. Under this type of business, there is no requirement of minimum share capital and members are equally responsible for the debts and liabilities. The profits can be equally shared between the members.
In Finland, Limited Partnership is formed by at least two partners out of which one of them must be the general partner with right to decide in the name of the business and claim profits and silent partner has no decisional powers and cannot claim profits but which doesn’t absorb the losses.
Finnish Branch of a Foreign Company is a part of a foreign society which operates in Finland. It is not considered as a separate entity and the capital is provided by the parent company. In Finnish market, in order to perform research activities, investors can also open a representative office.
Firstly, in order to open an account, entity must deliver the following documents to the bank and receive certificate in order to prove that the minimum share capital was deposit:
- Foundation deeds;
- Description of the nature of the banking transactions and
- Company’s field of business.
Once amount is deposited, until the company is registered amount of money cannot be withdrawn.
Application must be accompanied by the following:
- The articles of association,
- The memorandum of association,
- Declaration confirming that the company has been incorporated under the provisions of the Finnish Limited Liability Companies Act,
- Certificate of the auditors confirming the shares are respecting the provisions of the Limited Liability Companies Act and other relevant documents asked by it.
The last step of the company incorporation in Finland is the registration for the pension insurance can be made at a pension provider freely chooses by the entrepreneur.