To open a company in Estonia by power of attorney

Setting up a company remotely by power of attorney is one of the most convenient ways to register a business in the legal framework of the Republic of Estonia. This method is ideal for those who value their time and for whom planning a trip to Tallinn goes against their business plans and busy life schedule.

In order to set up a company in person, you will need to draw up a set of notarised documents, on the basis of which our lawyers will carry out the enterprise registration procedure on your behalf. You do not have to worry about anything – our consultants will provide you with clear guidance on how to draw up and notarise all the necessary documents.

We guarantee reliability and efficiency – our lawyers will carry out the procedure of your company registration within 5 days from the moment of receipt of the original notarised powers of attorney and other required documents.

The main stages of remote company registration in Estonia

The procedure for setting up a business and registering a company in Estonia remotely on the basis of the notarised power of attorney consists of the following steps:

  • Preliminary consultation. Our specialists will discuss with you the details and nuances of the forthcoming procedure for the remote establishment of your company, as well as answer all your questions regarding the start of business activities and further management of your enterprise.
  • Issuance of notarised powers of attorney. To carry out the remote company registration procedure, we will need: a notarised power of attorney issued to our company’s lawyers, and a notarised copy of the passport of the future founder. We will provide you with a template of power of attorney and a guidance on certifying documents. It will be necessary to send the originals of notarised documents to us by courier delivery.
  • Preparation of the company establishment procedure. After receiving the original notarised powers of attorney and agreeing with you the details of the forthcoming company registration procedure, our consultants will reserve time at the notary office and prepare the draft constituent acts and articles of association for your company.
  • Conducting the company establishment procedure. Our lawyers will carry out the company establishment procedure at the notary office in Tallinn, Estonia, and sign the constituent acts and other necessary documents on your behalf, acting on the basis of the notarised power of attorney you have previously granted.
  • Adding the enterprise to the Commercial Register of Estonia. All company incorporation documents drawn up at the notary office are submitted for processing and consideration to the Commercial Register, which enters the enterprise into the register of legal entities within 5 working days.

Upon completion of the process described above, you will be able to get acquainted with all the company’s data, as well as receive copies of the company’s constituent documents in electronic form on the Internet portal of the Estonian Commercial Register.

What information do we need?

To prepare and carry out the company registration procedure remotely without your personal presence in Tallinn, Estonia, we need the following documents and information:

  • Notarised power of attorney for company registration;
  • Notarised copy of an identity document;
  • Suggested name for the company to be established (2-3 options);
  • Planned field of activity of the enterprise to be registered;
  • Contact details of the company to be registered (telephone number and e-mail).

We will provide you with power of attorney templates in your preferred language, as well as give advice and guidance on the preparation of the notarial documents required for company registration. In the process of agreeing on details and nuances, we will ask you to fill out client questionnaires in order to clarify and record all the important circumstances related to your future enterprise.

Additional services

We will be glad to offer you a full list of services necessary for the successful registration of your enterprise in Estonia and its further operation within the legal framework of the European Union.

  • Legal address. We offer the service of a registered or legal address in Estonia with the possibility of receiving and forwarding incoming mail.
  • Contact person. We provide the services of a contact person for accepting and receiving official documents and notices in Estonia for companies and enterprises whose actors are non-residents.
  • Accounting services. We provide a full range of accounting services, from preliminary consultations to the preparation and filing of tax returns and annual accounts.
  • Legal services. Our lawyers will support you in dealing with legal issues of any complexity – from analysing legal documentation to defending your interests in litigation.

If you are interested in any other services not listed above, feel free to contact our consultants for more information and a personalised price quotation.

The cost of registering a company by power of attorney

The cost of a company registration service by notarised power of attorney without personal presence consists of the following components:

  • Legal support – 350 euros
  • Notary services – 150 euros
  • State fee – 200 euros
  • Legal address service for 1 year – 150 euros
  • Contact person service for 1 year – 150 euros

The total cost of setting up an enterprise on a turnkey basis – 1,000 euros

If you have any specific wishes regarding the conditions and nuances of the procedure for setting up your enterprise in Estonia, please contact our experts for a personalised price quotation.

Contact us

Establishing a company in Estonia is the best solution for starting and further developing your business in the European Union. You can find other important information on registering and supporting Estonian companies on the thematic page of our website.

If you wish to start the process of remote registration of a company in the legal environment of Estonia on the basis of a power of attorney or if you have any additional questions, please contact our consultants by phone, e-mail or by using the feedback form on our website.

Changes to VASP regulation in Lithuania in 2022/2023

Over the last five years we have seen rapid development of financial and payment services sector in Lithuania, and we can confidently state that Lithuania has become one of the significant centers of fintech industry in Europe and in the world. Today, the development of innovative financial technologies is quite difficult to imagine without the presence of cryptocurrencies and other products closely related to the blockchain system – thus, step by step, Lithuania has become today also one of the hubs for cryptocurrency exchanges and exchanges.

On June 30, 2022, the Seimas of the Republic of Lithuania passed a package of amendments to the Anti-Money Laundering and Counter-Terrorist Financing Law (AML Act). The main purpose of adopting these amendments is to streamline the legal framework governing the sphere of virtual assets and provision, as well as to increase, to some extent, the entry threshold into the virtual asset market for cryptocurrency service providers, which should improve the quality, transparency and reliability of exchange and storage services provided for cryptocurrencies and other virtual assets.

First of all, the above-mentioned amendments adjusted the definition of virtual currency. Thus, according to Lithuanian legislation, the term virtual currency, which includes all cryptocurrencies and most of the various tokens, is defined as follows:

Virtual currency is an instrument that has a digital value but does not have the legal status of currency or money, that is not authorized or guaranteed by a central bank or other government agency and that is not necessarily related to currency but that is recognized by individuals or entities as a medium of exchange and that can be transferred, stored, sold, exchanged, invested and used to settle by electronic means.

New requirements for Lithuanian cryptocurrencies and VASP

The amendments to the AML Act also established additional requirements for cryptocurrency companies that provide crypto-asset exchange and custody services. Below we list the most important circumstances that were outlined in the above-mentioned amendments, which should be paid special attention to:

Statutory capital for a crypto company in Lithuania

A legal entity established in the Republic of Lithuania, which intends to operate a virtual currency exchange operator and/or a virtual currency depository wallet operator, must have a registered share capital, which must be at least EUR 125,000.

Local AML officer / MLRO for VASP in Lithuania

A legal entity that has started operating as a virtual currency exchange operator and/or virtual currency deposit wallet operator must have a senior manager who is a permanent resident of Lithuania.

Providing services in the Lithuanian market

A virtual currency exchanger and/or virtual currency depository wallet operator must not provide its services exclusively to customers from another country or focus on providing services in another country’s market to the extent that its activities in the Republic of Lithuania could be considered formal and immaterial based on the company’s business model.

How to bring a company into compliance with the new requirements of the FNTT regulator?

Those cryptocurrency companies that have obtained a cryptocurrency license in Lithuania and registered the activity of a virtual currency exchange operator and/or virtual currency depository wallet operator before November 1, 2022 must bring their activities into compliance with the new requirements no later than December 31, 2022 and are entitled to continue their activities within the designated transitional period without any restrictions.

Statutory Capital Registration

Cryptocurrency companies operating in the jurisdiction of the Republic of Lithuania are required to form a share capital of at least EUR 125,000 by depositing money into the company’s current account, after which changes in the share capital must be registered with the Lithuanian Commercial Register and shown on the company’s register card.

The Lithuanian Commercial Code allows for contributions to the share capital of a legal entity so that 25% of the declared amount is paid at the initial stage and the remaining 75% must be paid within one calendar year.

Attracting a local MLRO

All active Lithuanian cryptocurrency exchanges must recruit a local AML officer / MLRO into their staff no later than December 31, 2022, conclude an employment contract with him/her and notify the FNTT regulator of the local AML officer’s assignment to the cryptocurrency company. Our team is ready to provide you with HR services and help with recruiting a qualified MLRO from among residents of the Republic of Lithuania, as well as offer further support on the issue of formalizing the employment relationship and their registration with the tax authority and SODRA and notifying the FNTT regulator of the appointment of an AML officer.

What happens if I ignore the new FNTT requirements?

If a crypto-enterprise for any reason ignores the obligation to comply with the new requirements of the AML Act and the FNTT regulator and fails to bring the company into proper form by December 31, 2022, such crypto-company will be excluded from the list of virtual currency exchange operators and/or virtual currency depository wallet operators and lose the right to provide crypto-oriented services starting from January 1, 2023.

Assistance in adapting the company to the new FNTT requirements

Our experts are ready to fully assist you in adapting your crypto project and bringing your cryptocurrency company in line with the new requirements of the FNTT regulator. We will help you with making and registering share capital, offer individual HR services in finding and hiring a qualified MLRO, and accompany you in resolving other nuances and circumstances that need to be resolved as the company adapts to the new requirements of the AML Act of the Republic of Lithuania.

Is Lithuania still an attractive jurisdiction for crypto projects?

Yes, Lithuania certainly remains one of the most relevant and efficient jurisdictions for crypto-oriented activities and crypto-asset exchange and storage services and is likely to remain so for a long time to come.

This is due to the fact that the regulation of virtual assets and cryptocurrency exchange and storage services in Lithuania remains one of the simplest, most straightforward and liberal compared to other jurisdictions in Europe. The AML Act of the Republic of Lithuania does not provide for any additional AML/KYC obligations for cryptocurrency market participants, unnecessarily aggravating and bureaucratic internal processes of a cryptocurrency company, therefore the state policy towards crypto-assets and AML/CFT legislation of Lithuania and FNTT regulator practice can be considered as a reference for other European states.

Also, the previously outlined changes regarding increasing the authorized capital (at the initial stage, a contribution of 25% of the required amount of EUR 125,000) and involvement of a local MLRO (Lithuania has a sufficient number of qualified AML specialists) are not excessive and burdensome, because they can be implemented without much difficulty by the average participants of the Lithuanian cryptocurrency services market.

Contact us

If you are interested in registering a crypto company in Lithuania and obtaining a VASP license, or if you would like more information about the innovations in the Lithuanian AML legislation – please contact our consultants by phone, e-mail or using the feedback form on our website.

Registration of an NFT company or marketplace in Estonia

As the ICO boom passed, blockchain technologies began to spread actively and were used not only in financial and investment environments, but also began to gradually enter other areas of everyday life. Thus, in the last few years, the NFT industry has developed extensively, making it possible to create standardised property certificates for digital objects.

An NFT (non-fungible token) is a type of cryptographic token that, as elements of the blockchain network in the form of digital records, is tied to specific digital objects, making each exemplar of NFT unique in nature and not replaceable with another similar token.

Any digital product, content or asset that claims to be unique can be represented as an NFT: an image or picture, a gif or animation, music or song, video or film, text or post, or any inventory or asset from a computer game that is exclusive to that game for one reason or another.

By purchasing an NFT token, the user becomes the holder of an electronic or, in other words, cryptographic certificate for a piece of virtual art, asset or content. At the same time, a record is generated in the blockchain network that confirms the user’s ownership of the digital object, which is sent to IPFS (InterPlanetary File System) for storage.
NFT tokens are particularly popular with progressive collectors and modern art lovers, as well as gamers who invest in unique and exclusive inventory for their characters and other virtual goods and objects in game universes.

NFT services and industry

The main players in the market for NFT services are the developers and issuers of NFT tokens, as well as platforms for placement and further sale of NFT, also referred to as NFT marketplaces. In 2021, the volume of trading in non-interchangeable tokens exceeded the amount of 13 billion US dollars, so this indicator increased almost 400 times compared to 2020, with OpenSea becoming the most significant marketplace, which provided about 88% of the NFT trading volume.

Based on the above data, it can be unequivocally asserted that NFT is no longer a niche product and is currently of interest to a wider user audience; in addition, the NFT industry has acquired a significant business component among other blockchain projects.

Your NFT project in Europe: why Estonia?

Development and promotion of any NFT project and provision of NFT-related services on a commercial basis involves setting up a legal entity, in whose name all the necessary infrastructure for successful business operations (website, trading platform, settlement accounts, etc.) will be registered, and on whose behalf all legally significant actions will be performed, including the creation, placement and sale of NFT tokens.

Are you looking for the most suitable jurisdiction to start your NFT project in the European Union? Among all European countries, we recommend that you first of all pay your attention to Estonia, as the most efficient jurisdiction in the NFT context.

Estonia has long gained a reputation as one of the world’s centres for the development of innovative technologies – for many years, Estonia has paid special attention to the development of its IT industry and high-tech business environment. Adding to the above circumstances the fact that Estonia has no corporate tax on undistributed profits and that Estonia was the first country in the world to introduce regulation of cryptocurrencies and services for their exchange and storage at the legislative level, it can be said with full confidence that Estonia is the ideal jurisdiction to register and start the activities of your NFT startup.

Registering your NFT business in Estonia will necessarily become an effective solution for the successful start of your NFT project and the entry of your NFT startup to the international market for non-fungible tokens.

NFT company in Estonia: token development and issuance

If you have unique digital content and you want to develop and offer your own non-fungible token to an interested audience, or you have plans to create an entire line of NFT tokens, opening an NFT company (an NFT token developer company) in Estonia will undoubtedly be the best solution for developing your NFT project. Feel free to contact our specialists and we will help you set up an effective corporate structure for launching your NFT business as soon as possible.
NFT marketplace of Estonia: listing and sale of tokens

Do you want to place (list) and offer NFT tokens developed by third parties to a wider audience by setting up your own NFT exchange or NFT marketplace? Our specialists have many years of experience in supporting various blockchain projects of various kinds and are ready to offer the most advanced organisational and technological solutions for your NFT project, which will help introduce your marketplace into the legal framework of the European Union as soon as possible.

Is it necessary to obtain a licence to issue the NFT?

Generally, NFT projects that create, place or sell NFT tokens do not require any separate licensing or obtaining a permit to operate.

NFT tokens are not directly described or regulated in Estonian legislation and are not virtual assets within the meaning of the AML Act of the Republic of Estonia, as they are not primarily a means of payment and are not accepted as a means of payment by a wide range of persons.

However, the intergovernmental organisation FATF (Financial Action Task Force on Money Laundering) has pointed out in its 2021 guidelines that some NFT tokens, which at first glance have nothing to do with cryptocurrencies, may still fall within the definition of virtual assets if practically used for payment purposes; in this case the issuing company or marketplace will have to obtain a VASP (Virtual Asset Service Provider) licence as part of its business.

You should also be careful if the NFT token is directly or indirectly intended to be used for investment purposes, or potentially gives its holder the right to receive a part of the profit or the right to participate (share) or vote in any enterprise (project) – in this situation, you may be dealing with a security token, the issue and offering of which may be subject to securities regulations and the competence of the financial regulator.

If you find any of the features or properties outlined above in the NFT tokens you are developing or placing, we strongly recommend that you conduct a thorough analysis of the nature of your NFT token in order to avoid any future difficulties.

We would also like to note that accepting payments in cryptocurrency for services or goods is a legal payment method for Estonian companies. However, a clear distinction must be made between the implementation of transactions for the purchase and sale of NFT for cryptocurrency and the provision of VASP services, which include cryptocurrency exchange and storage services and the implementation of cryptocurrency transactions that require an appropriate licence.

Contact us

Setting up an NFT business in Estonia has many advantages and will certainly become an effective tool for developing your NFT startup.

If you are interested in the possibility of registering an NFT company in Estonia or you have any additional questions, please contact our specialists by phone, e-mail or by using the feedback form on our website.

Registering a company in Estonia in person

One of the most common ways to establish a company in Estonia is to do it in person in Tallinn. This is the fastest and most convenient way to register your company in Estonia and bring your business project to the international market.

To launch a company in person, you need to plan your trip to Tallinn – you can do everything in one working day, so you do not have to stay long in Estonia.

You do not need to worry about anything – our specialists and consultants will prepare all the necessary documents, make an appointment with the notary, confirm the instruments of constitution of your future company and accompany you personally throughout the entire process.

Main steps of registering a business in Estonia

The preparation and carrying out of the registration procedure can be divided into the following steps:

  • Pre-Consultation. Our specialists will answer your questions and discuss with you the details of your visit to Estonia and the company’s registration procedure.
  • Coordination of your arrival in Tallinn. Since we need to coordinate with the notary and book a time, we ask you to inform us 3-5 days in advance of your planned visit to Estonia.
  • Preparation of instrument of constitution. Our consultants will prepare the memorandum of association and the provisional articles of association as well as check if you are free to use your chosen company name and help you choose the correct area of activity.
  • Carrying out the notarial proceedings for establishing a company. All operations related to registering a company will be conducted at a notarial office. Our lawyers will accompany and consult you at the notarial office throughout the entire process of establishing the company.
  • Entering the company into the Estonian Business Registry. After the end of the notarial proceedings of registering your company, all instruments of constitution will be forwarded to the Estonian Business Registry and your company will be entered into the register within five working days.

After the completion of the registration process, your company will be entered into the register where you can view the company’s details and get electronic copies of all instruments of constitution.

What information do we need from you?

We need the following details for booking an appointment at the notary and preparing the registration procedure and instrument of constitution:

  • The presumed date for your trip to Tallinn;
  • The preferred names for your company (2–3 options);
  • The planned area of activity;
  • Contact information (phone number and e-mail) for your company;
  • The founders’ and the directors’ information (given name and surname, address, etc.).

In order for us to be able to prepare the instrument of constitution, we ask you to send scanned copies of the founders’ passports and fill in forms and questionnaires about your clients to specify and fixate all important matters related to the company.

Additional business services

You should also consider the following services for the proper registration and further operation of your business:

  • Legal address. You need to indicate the legal address of the company in Estonia when registering a company. Our company offers legal address services in Estonia, including receiving and forwarding incoming letters.
  • Contact person. Every company whose board members are non-residents in Estonia is obliged to appoint a contact person to whom official documents, notices and other letters can be delivered. We offer contact person services in Estonia for legal entities.
  • Accounting services. Every legal person registered in Estonia is obliged to keep business records and submit an annual report to state agencies. Our accountants will provide you with comprehensive accounting support.
  • Legal services. Our experienced lawyers will offer you comprehensive legal aid beginning from pre-consultations and analyses of legal documentation to representing clients’ interests in court proceedings.

Our specialists are ready to offer you all the services necessary for the establishment of your company in Estonia and its further functioning in the legal framework of the European Union.

The cost of registering a company in Estonia

The cost of the whole process of registering a company in person in Estonia includes the following:

  • Legal services – 100 euros
  • State fee – 200 euros
  • Notarial services – 150 euros
  • Legal address for one year – 150 euros
  • Contact person for one year – 150 euros

Total cost of turnkey solution of company incorporation in Estonia – 750 euros

If you have any specific requests or wishes related to the instrument of the constitution as well as preparing and carrying out the registration procedure in Estonia, please contact our consultants to receive a personal quote.

Contact Us

There are many advantages to registering a company in Estonia and it will become an effective tool for developing your business. You can find all the additional information about registering a company in Estonia on the thematic page of our website.

If you are interested in registering a company in Estonia in person or if you have any questions, please contact our specialists via phone, e-mail or the feedback form on our website.

Investments in Cryptocurrency and Crypto Assets

Lately, the investment components and the value of various cryptocurrencies and other virtual assets (tokens, NFTs, etc.) have significantly increased. The modern finance world is becoming more and more intertwined with innovative solutions and blockchain technologies – today, it is rare if an investment portfolio does not contain any crypto assets. People often ask us if, under the law of the Republic of Estonia, any restrictions apply to the legal persons registered here when investing in crypto assets and other virtual assets.

Our answer is – yes, of course, all Estonian companies, regardless of their legal status, are entitled to invest their accumulated funds in cryptocurrency, tokens, NFTs or other virtual assets. And that’s not all – the Estonian tax legislation does not tax the re-investment of profit received from the economic activities of a company – all retained earnings’ tax rate is 0% (the profit of a company will not be taxed with income tax until the decision of payment of dividends).

However, it should be noted that a company’s board is obliged to strictly follow the principles of due diligence, avoid investing their resources in unknown cryptocurrencies and questionable blockchain projects and use only safe and reputable crypto exchanges or other platforms. Additionally, purchases of any crypto derivatives (e.g., utility tokens or NFTs) shall be transparent and an investment context shall be determined. Otherwise, the owners of the company but also creditors in case of bankruptcy are entitled to request the board members to compensate for any damages caused by the impetuous investment decisions.

Do You Need a VASP license?

You don’t need a license or permission to buy cryptocurrency or to invest the company’s funds in virtual assets. Every company has the right to freely make its own investment decisions, including investing in modern and developing technologies and innovative investment instruments.

A licensing issue might arise when a company decides to offer cryptocurrency exchange or storage to third parties as part of its economic activities. If a company only uses crypto exchange and investment platform services offered by third parties, they don’t need a VASP (virtual asset service provider) license.

Infrastructure for Investments

You need an infrastructure for transactions with cryptocurrencies and virtual values – company accounts on a crypto exchange or cooperation with other cryptocurrency investment platforms.

Not all banks and payment systems support EMI and PSP cryptocurrencies, and this is somewhat understandable – virtual currencies are high-risk assets, they provide anonymity and are often used for illegal purposes (money laundering, financing terrorism, tax evasion, concealment of criminal proceeds, etc.). Due to this, we recommend considering all possible channels for storing and later withdrawing cryptocurrency on crypto exchanges before investing to avoid unnecessary difficulties, delays, and inconveniences later.

Our specialists have years of experience in supporting crypto companies and blockchain projects. If you need help with opening a bank account in banks that accept cryptocurrency and blockchains or a company account on trustworthy crypto exchanges, our consultants are happy to answer your questions and will offer you the most effective solutions.

We don’t recommend that you use trading accounts or other accounts belonging to individuals for purchasing cryptocurrency. Transferring money from a company to these accounts or crypto wallets is seen as paying dividends or remuneration (a company is a taxable person) or a private person receiving income to their trading account from the investment (a private person is obliged to pay their taxes).

Accounting for Crypto Assets

In addition to the previously mentioned matters, it is worth noting that recording the investment assets of a company, including the proper calculation of its profit or loss, is an inseparable part of accounting and financing. The statements on cryptocurrency accounting and crypto assets need to involve each transaction, taking into consideration the exchange rate at the time, and display all crypto wallet balances in their base currency, euros.

Since accounting cryptocurrency and its assets and composing financial reports is an own specialisation in the provision of accounting services, we recommend that you contact accountants with the relevant skills and experience – our accounting specialists have experience in supporting cryptocurrency projects and blockchain start-ups since 2017 and they are ready to offer you high-quality accounting support.

Contact Us

If you wish to start a company in Estonia to invest in cryptocurrencies, tokens, NFTs or other crypto assets or you need legal or accounting consultation, feel free to contact our consultants!

Annual report for Estonian companies

Preparing and filing the report for the business year (annual report) is mandatory for all legal entities and enterprises that are registered and operating in Estonia. The annual report is submitted to the Commercial Register, and all information in the report becomes public – everyone has the right to access the financial statements of any enterprise.

The main purpose of introducing the obligation to prepare and submit financial statements to the Commercial Register annually is to provide objective and reliable information on the financial position and the results of the company’s business activities to governmental authorities and other interested parties.

What does the annual accounting report consist of?

The annual report must comply with the established rules and standards, and include the following items:

Balance sheet

The balance sheet provides information about the company’s financial position, including its assets, liabilities, and equity, as of the last day of the financial year (31 December by default).

Income statement

The income statement lists the income and expenses of the enterprise within the reporting period (year), reflecting the economic indicators of the company, including income, expenses, profit or loss.

Cash flow statement

The cash flow statement reflects the cash flows of the enterprise for the reporting period, including cash receipts and cash equivalents and disbursements, as well as payments made by the company during its business activities, grouped according to their purpose as cash flow from operating activities, investing activities and financing activities.

Statement of changes in equity

The statement of changes in equity reflects movements and transformations in the company’s equity that occurred during the reporting period, including contributions to the authorised capital of the company or payments made to the company’s participants, profit or loss as well as other significant circumstances and data that affected the size of the company’s equity.

Additional information

Depending on the specifics of the commercial activities of the enterprise, the annual financial report must include certain additional information. As a minimum, the following annexes should be attached to the annual report:

  • report on the activities of the enterprise – a description of the company’s activities and its plans as well as of other significant circumstances that are relevant in the context of the annual report;
  • explanation as to the financial reporting standard applied in the preparation of the annual report;
  • accounting principles used to prepare the annual report;
  • explanations and clarifications on significant items and articles, changes in the main statement and during the reporting period.

Zero balance

The obligation to prepare and file annual financial statements (annual report) applies to all companies, regardless of whether the company was economically active during the financial year or was idle for any reason.

In case of a complete absence of any economic activity of the legal entity (there is not a single accounting transaction in the bank or the cash register), it is necessary to prepare and submit a zero balance report to the Commercial Register.

Deadlines for filing annual financial statements

The annual report must be prepared, approved and submitted to the Commercial Register within half a year (6 months) after the end of the business year. Thus, if the business year of the enterprise is equal to the calendar year (from 1 January to 31 December), the deadline for filing the annual financial report will be 30 June.

If the annual report is not filed by the due date, the Commercial Register is entitled to impose penalties on the company. As a rule, for the first warning, the Commercial Register gives the enterprise an additional term (typically 30 days) to submit the annual report. Further, if the company ignores the indicated order, it may be fined up to EUR 3200 (typically EUR 200-300). Finally, if neither orders nor penalties have any effect, the Commercial Register can initiate compulsory liquidation proceedings against the company.

Recently, the Commercial Register has started to pay particular attention to businesses that do not fulfil their obligation to file financial statements with the governmental authorities. Thus, the number of orders and fines issued by the Commercial Register has increased tenfold. Thereby, we strongly advise you not to delay preparing and submitting your annual statements and fulfil all obligations on time.

How do I file my annual report?

By default, the annual report is submitted to governmental authorities in electronic form through the online portal of the Commercial Register. To provide the accountant with access to the online environment, used for filling out the forms and preparing the annual report for filing and subsequent signing of the financial statements, the general manager of the company (member of the management board) must have a valid electronic signature (ID-card, Mobile-ID or e-Residency).

As an exception, if all general managers of a company are non-residents who do not have an Estonian personal identification code and the right to electronic signature, they can sign the annual reports by hand and submit a scanned copy of the signed report to the Commercial Register. In this case, the accountant will pre-fill out all the necessary forms, generate a standardised report form and provide the Commercial Register with a scanned copy of the annual report signed by the general manager of the company independently on his own behalf.

Do you need to prepare an annual report?

If you need help preparing and filing an annual report for your enterprise, feel free to contact our accountants. To assess the work to be completed and prepare a quotation, we will need a brief description of the activity of your enterprise, as well as statements of all transactions from the bank and cash register, if any.

Usually, it takes our accountants one week to prepare and check the annual report. In this case, the cost of accounting services starts from EUR 150. You can learn more about other accounting services on our webpage.

Contact person in Estonia

In early 2018, amendments to the Commercial Code came into force in Estonia. According to them, all foreign companies are obliged to appoint a local contact person to whom official documents and notices addressed to the enterprise can be delivered.

The need for a contact person arose from the fact that Estonia has become rather popular for company registration by non-residents, and the number of Estonian companies set up by foreigners has exceeded several tens of thousands. As the actual connection of such companies with Estonia may be minimal, it is necessary to provide a steady channel of communication and transmission of notices, declarations of intent and other relevant correspondence between the governing bodies, managers of foreign companies, state authorities, counterparties and/ or potential creditors of the company.

Thus, according to Section 631 of the Commercial Code of the Republic of Estonia:

  1. An undertaking may designate a person to whom the procedural documents of the undertaking and the declarations of intent addressed to the undertaking (hereinafter contact person) may be delivered in Estonia. Upon delivery of a procedural document or declaration of intent to the contact person, the respective procedural document or declaration of will is deemed to have been delivered also to the undertaking.
  2. If the management board of a commercial partnership or a body substituting therefor is located in a foreign country, the company must appoint a contact person specified in subsection 1 of this section. In such case, only a notary, advocate, law office, sworn auditor, tax representative of a non-resident or a provider of trust and company services may be designated as a contact person. The address of the contact person shall be considered the address of the company in such case.

The purpose of introducing the concept of a contact person is to fully legitimise the situation when a company registered in Estonia is fully managed from abroad, and all the management bodies of a legal entity are located in a foreign country.

The powers of a contact person

A contact person is in one way or another a representative of the company and their details are included on the company’s registration card. However, the representative function of the contact person is solely passive – the contact person is only authorised to accept official documents addressed to the undertaking. A contact person does not hold any rights to take legally significant actions on behalf of the company.

However, it should be noted that under the current legislation, delivery of any notices or documentation to the contact person is equivalent in nature to the delivery of these materials to the management board or general managers of the company. Moreover, upon the appointment of a contact person, their contact details become part of the official contact details of the company, and the address of the contact person becomes the official address of the foreign company.

Can you start a company without a contact person?

When non-residents register a company, the presence of a contact person is a condition at the notary stage as well as when registering a company in the Estonian Commercial Register. If it is revealed that a company failed to appoint a contact person, the Commercial Register will grant a term for eliminating the deficiency, and the company will not be registered until the appointment of a contact person.

If the company is found to have an obligation to appoint a contact person, but this obligation has been ignored for any reason, or the previously appointed contact person has resigned, the Commercial Register is entitled to establish a term for the company for the elimination of the deficiency; in case of failure to comply with this requirement, the Commercial Register is entitled to fine the company or initiate proceedings for the forced liquidation of the legal entity.

Who can be a contact person?

The law stipulates that not everyone is entitled to become a contact person in foreign companies. The purpose of narrowing the pool of potential candidates for contact persons is to grant this right to representatives of only such professions that are by default subject to increased requirements for qualifications and due diligence and who look unambiguously trustworthy persons in the legislators’ and public eyes.

Thus, according to current legislation, notaries, lawyers, sworn auditors or providers of trust and company services may serve as contact persons.

Order a contact person service in Estonia

Our company is registered as a contact person in the Estonian Commercial Registry and holds a state licence no. FIU000144, issued by the Estonian Financial Intelligence Unit (FIU), thus we are legally authorised to offer contact person services to our clients.

The cost of the contact person service is €150 per year

You can find more information about the provision of representative services and virtual office services in Estonia on the thematic page of our website. If you would like to order contact person services, please contact our specialists by phone, e-mail or by filling out the relevant form on our website.

A company in Europe – why Estonia?

Do you want to start a business and register a company in Europe? We recommend that you consider opening your company in Estonia since it has many assets and stands out among other European Union countries.

At the end of 2021, there were 241,181 companies registered in Estonia out of which 24,779 (about 10%) were established last year. Given the size of Estonia’s population (1.3 million inhabitants), these figures clearly demonstrate that Estonia is a popular destination for foreign businesses to minimise jurisdictional and other risks as well as to optimise taxes.

Here are the 10 key reasons why you should set up your business and register a company in Estonia:

  1. In Estonia, there is no tax on retained earnings at all. This means that the profits of any Estonian company are exempt from corporate income tax until they decide to pay dividends and the accumulated profits are distributed among the company’s participants. This allows companies registered in Estonia to accumulate profits freely and invest funds without paying corporate taxes.
  2. Estonia ranked 1st on the International Tax Competitiveness Index thanks to its extremely straightforward and transparent tax system. The process of calculating, declaring, and paying taxes is easy, convenient, and as automated as possible. All legislative acts and tax regulations are written in simple and clear language, you can find all the necessary information on the website of the Estonian Tax and Customs Board, and the tax administration employees are always friendly and ready to help you.
  3. Estonia has the most favourable business climate – it is not for nothing that Estonia holds leading positions in various international rankings: 7th place in the Index of Economic Freedom and 18th place in the Ease of Doing Business Index.
  4. Unlike many other European countries, there is no need to contribute authorised capital when registering a company in Estonia, which makes the process of starting a business straightforward and unbureaucratic.
  5. Estonia has been a member of the European Union and the European Union Customs Union since 2004, which means that all customs duties and restrictions on trade activities throughout the EU are abolished.
  6. An e-Residency programme was put in place for foreigners in Estonia in 2014, allowing non-residents to obtain an electronic signature accepted in Estonia and other European countries. The e-Residency and electronic signature enable non-residents to use various online services, including the electronic Business Register through which you can register a company quickly and conveniently and carry out further management of the enterprise.
  7. You can instantly and effortlessly open accounts for your Estonian company in electronic payment systems such as Wise, Paysera or Revolut, which will facilitate entering international markets.
  8. Even though official paperwork in Estonia is conducted in Estonian, you can always contact and communicate with government authorities in Russian or English.
  9. The registration process in Estonia is as efficient, transparent and unbureaucratic as possible. In just a few days, you can register a company in-person, remotely by the power of attorney or online using e-Residency.
  10. To establish a business in the Republic of Estonia, you don’t have to involve local residents in its structure. The founders and general managers may be 100% non-residents of Estonia.

This is by no means a complete list of advantages in choosing Estonia for setting up your business in the European Union. You will find more information about the procedure and conditions for establishing an enterprise in Estonia on the thematic page of our website.

If you are interested in registering a company in Estonia, or if you have any questions, feel free to contact our specialists by phone, e-mail or by filling out the appropriate form on our website.

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