How to register a company in Finland in 9 (almost) easy steps
Surprisingly a google search for “how to set up a company in Finland” does not really give a definitive answer, thus, I decided to put up a very simple guide mostly based on a personal experience and things learned during Nordic Founders meetups in Helsinki. It may seem like a long list, but in short, it’s really quite simple:
- Make sure you have Finnish social security number
- Choose the right form for incorporation
- Pick a name
- Stockpile the capital (2500€)
- Document first shareholder meeting
- Make an online application
- Open company bank account
- Transfer capital
- Get company ID
Now in more detail
1. Be a resident
That is the obvious one requirement, but still a lot of foreigners thinks the process is very similar to US (walk into registrar office and pay the fee). It is not. It is really a good idea to have valid grounds for being in Finland — work or study is the best.
2. Choose the right form for incorporation
There are few options you can choose from (which deserves a separate story), but for simplicity sake stick with “limited liability company” form (osakeyhtiö in Finnish, or frequently abbreviate to just Oy). I will cover other forms later, note that one of them (sole trader or toiminimi) can be potentially usefully if you business can be described as “one man and a dog”.
3. Invent a great name
Seriously, that is the most difficult part of the process. There is a pretty good summary of what you can and can not use as a name here. Once you have something — make sure check no one else already registered it before you. Name squatting is not very common in Finland, but of course, most obvious combinations are already taken.
4. Get the capital
Bad news, in order to register an Oy you need 2500€ in cash. Good news that money represent share capital of your company. The actual registration fee is only 330 € (if you do it online ) and rest of the sum is free to be spent (or not) on any other company purchases. Naturally, as any proper Finish entrepreneur, you have to splurge on a fancy coffee machine.
5. First shareholder meeting
Very carefully think about shareholder structure (who owns what). There is no silver bullet for this, but try to come up with something that is fair for all founding members. In case you are doing it alone, it is, of course, easy — you simply own 100% of all shares. It is a good idea to define share price as low a possible, for example at 2.5 euros cents. This way 2500 € is exactly 100 000 shares. There is a choice betwee A and B class shares, it is best not to overcomplicated your life at this stage and declare all shares as ordinary class A shares.
Draft a shareholder meeting minutes where you specify who are the shareholders (this name, addresses, citizenships and social security numbers), share distribution and a decision to incorporate according to Finnish law. It is also a good idea to agree who will act as a chairman of the board (do not confuse with CEO or managing director) and ordinary board members. Each registered company must have at least one chairman and one ordinary member (at least one person needs to have a permanent residency in EU).
You also need to create an sign an “memorandum of association”, if you go with a paper way — Google for an example. If you decide to make a notification online, there is a template provided by PRH (it works for most cases).
6. Make an online application to PRH
PHR (Patentti- ja rekisterihallitus) is the only organization you need to deal in Finland for most of the company governance-related questions. Most of the paperwork can be done online, as long as you all company founders have Finnish social security numbers (a couple of other conditions can be read here. If you don’t you would need to make a paper notification which is a bit more complicated (full list of documents). In both cases, you will be asked to provide the information you came up in the previous step. Upon completion of application, you will be asked to pay 330 €. At this point of time, one person can do it from a personal bank account and get a refund later.
Despite common belief, it is not manadotry to specify your accounting company and auditor at this stage. You can select them later (both needs to have a license to operate in Finland).
7. Open your company bank account
Choose any bank of you liking (good idea to stick with the bank where you already have an account), give them a call and ask for a meeting to set up a company bank account. Meeting itself is pretty straightforward and will take 15 minutes max. It is important to come to a meeting prepared and have:
- certificate that indicates registration desolation has been submitted (receipt from online application works just fine;
- shareholder meeting minutes you made on step 6.
8. Transfer capital
Company supposed to have capital and that is where 2500 € you luckily already have come in handy. Each founding member needs to transfer share capital corresponding to company ownership from personal bank account with an indication of the amount of shares being bought (for example 50% owner would need to transfer 1250 € and write a message “Purchase of 50 000 shares of Company Oy at price 0.025 euros). If all founders have personal accounts in the same bank — the transaction is instant, if not, you will need to wait for a couple of days for the bank to issue a statement.
9. Get company ID
If you did notification online, you would need to login to your YTJ account again and confirm the transfer of funds. In the case of a paper notification, you would need to ask the bank to provide you with account statement which you need to submit to PRH. Then in 2–4 weeks (really don’t try to register anything during July) you will get a registration certificate and 8 digits company ID from PRH.
Congrats! Now you are officially a “Nordic Founder”. But don’t get relaxed, it is just the beginning. We will cover all new fun activities you can (and sometimes must) do as a business owner in Finland in future.
