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The advantages of setting up a limited liability company in European countries

Europe is without a doubt one of the most appealing investment destinations in the world. The European Union and its member countries taken separately offer many advantages to investors who want to open companies on the Old Continent.

Those who decide to open a company in an EU country will benefit from a unitary legislation which will allow them to operate in the other states much more easily, while those who decide for a non-EU country will benefit from protocols and agreements signed with the member states.

So how to choose the best European country to open a company in? The first step is to analyze the market and then choose the proper type of company. With respect to the latter, the limited liability company is widely used on the European market.

The limited liability company across European countries

There are many advantages of opening a limited liability company, the best one being the limited liability of the owners. This simply means that, in case of anything going wrong, the owner will be liable for the debts of the company within the boundaries of the amount of money invested.

Another significant benefit of choosing a limited liability company is the capital which is required upon incorporation. Many European countries have diminished the share capital requirements for this type of company. One of the best examples in this case is the Netherlands: those who want to open a Dutch limited liability company need only 1 euro as a share capital. Of course, the overall costs will be higher, but the Netherlands remains one of the cheapest European countries to open a company in.

It also helps to know that the requirements for registering such company are pretty much the same in all European countries. These requirements refer to the number of shareholders, company management and residency of company directors. The minimum number of shareholders is usually one or two, as for the directors, these need not necessarily be residents of the country where the company is registered.

Registering a limited liability company in an European country

The incorporation of a limited liability company in all European countries is simple and fast, this is why many foreigners choose it. The documentation requirements have been reduced to a minimum and most local authorities require the passports of the future business owners and drafting and notarization of the company’s statutory documents. Most of the times, the Trade Register in the chosen country will have samples of the incorporation documents which can be used when setting up limited liability companies.

Other important steps when opening a limited liability company is opening a bank account and registering for tax and social security purposes.

If these steps seem hard to complete, there is no need to worry: most of them can be completed online, as most European countries have created e-government systems which allows investors to file the documents online. Italy was one of the first countries to use such system, so those who want to set up a limited liability in Italy can easily register it online.

One aspect which differs from country to country is the licensing. This phase will depend on the industry chosen and the approvals needed, however these requirements no longer depend on the type of structure chosen.

The limited liability company is one of the most advantageous types of entities in the world. No matter the country one wants to set it up in, it will be subject to similar requirements and simple registration procedures and Europe makes no exception. What Europe has to offer compared to other continents is a flourishing economy and market stability.

photo credit: marcoverch Hand hält eine Gänseblume vor unscharfem Hintergrund. Frühling via photopin (license)

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