Finland – Ready Made Shelf Companies – Company Formation

Finland

Finland is a Nordic republic located between Sweden and Russia, and also the northernmost member of the European Union. It has two official languages: Finnish and Swedish, the latter due to the presence of over 370,000 Finland-Swedes. The country has one autonomous province: Åland Islands.

Finland gained its independence in 1917, joined the UN in 1955, OECD in 1969, WTO and EU in 1995 and Eurozone in 1999. Currently, it is the sole Nordic country that adopted euro as the official currency. According to the Finnish business legislation, shareholders establishing a private limited company (Osakeyhtiö or Oy) need to provide at least 2,500 EUR of initial capital. The registered name of this type of company has to include the words osakeyhtiö, oy, aktiebolag or ab. Entities with share capital exceeding 80,000 euro must appoint at least three members of the management board and one managing director. As a general rule, at least of the members must be a resident of EEA.

Companies, with the exception of small enterprises, are under obligation to have an auditor. This can be a natural person or an authorised audit office. Audit is obligatory for companies with control over other entities. Other types of business structures in Finland are public limited liability company (shares are traded in a stock exchange), general partnership and limited partnership. The corporate tax rate is 20%. The rate applies to big as well as small business entities. There are no restrictions on dividend distribution or transferring profits to other countries. Taxation on dividends depends on their value in relation to the value of equity. Dividends from a private limited company to a private or public limited company are exempt from tax. Capital gains tax is 30 to 34 percent. The general VAT rate in Finland is 20%. Finland is among the world’s top 15 countries with the highest nominal GDP per capita. The state’s economy is driven by the service sector, followed by manufacturing. Agriculture and forestry are also of significance to the economy. Finland’s biggest trade partners are Germany, Russia, and Sweden. According to the World Bank Group’s Doing Business report, the country is among the top 20 places in the world with the best business environment. Finland is a republic with a unicameral Parliament whose members are elected in general elections which are held every four years. The Finnish head of state is the President. The government (known as the Council of State) is headed by the Prime Minister. Government members have collective ministerial responsibility. In Finland there are more than 250 credit institution. The country’s financial sector, including banks, is supervised by the Financial Supervisory Authority. There are four major banks: OP Financial Group, Nordea, Municipality Finance and Danske Bank. The Bank of Finland is the world’s fourth oldest central bank.