Today, it becomes more and more in fashion to do business in other countries. It seems that regulatory reforms are more comfortable there, the market is larger, and technology is more accessible. But there are a lot of restrictions such as language, mentality, and far from every country that allows a foreign citizen to set up a company.
How to choose a country where doing business will surely work out? Criteria by which you can select a country for doing business are as follows:
Many of these criteria are measured from year to year by the World Bank’s Doing Business rating. Also, you can rely on news in business media, which makes it entirely possible to get information about the development of technologies in a particular country, the level of corruption, political freedom, etc. As a rule, the Scandinavian countries are called the most convenient for doing business in Europe. But everything is not so simple. Together with a favorable business environment and high financial well-being of the population, one of the highest costs of doing business awaits you there.
Payment for comfort
Everyone can start a business in Sweden, including a foreign citizen. Non-residents in Sweden can register a limited liability company (Privat Actiebolag), and an open joint-stock company (Publikt Aktiebolag), these forms of business are similar to Russian LLC and PJSC. One manager can manage Privat Actiebolag, but Publikt Aktiebolag should have three or more directors, so in Sweden, possible management conflicts are resolved from the get-go. Non-residents can also manage the company, without legal problems in their country, in the company, at least one of the directors must be a Swede. In management measures, a foreigner must have a special work permit (from the National Patentoch Registreringsvercet).
It is also essential to choose a name and register with the Swedish Enterprise Registration Service (Bolagsverket). According to the rules, it should not repeat any of the available ones, as well as mislead consumers. The next step is to add the company to the state registry, and this can be done online. And you will receive a confirmation in just 2 hours. The main digital business resource in Sweden is Verksamt. On it, you can not only register a company but also fill out a business plan. You can use the consulting service for all organizational parts, and it will cost $ 50 per hour. You can also buy a ready-made company that was registered with a resident of Sweden, and even with a prefabricated client pool. In this case, 50% of the board members will be appointed from among the residents of Sweden.
The Swedish authorities actively support the local small business, in particular, help unemployed citizens to open their markets. For example, the employment service holds special educational meetings, even helps financially, until the business gains momentum. There are free courses on conducting and promoting a business, and even ambulance entrepreneurial assistance — business consultants who help to get out of such micro-crises for free. However, for non-residents, such support is unavailable.
Besides, Sweden has very high taxes – about 60%. 32% is the tax of the company, which includes municipal taxes, income tax, and social contributions, 25% of the value-added tax (VAT) is partially refunded. Plus, customs fees if the company works with foreign partners. End-to-end and unified reporting – conducted through a single database of banks, social protection services, and other government agencies. It is not recommended to avoid taxes, and if such a fact is discovered, an entrepreneur can receive a fine of up to 40% of hidden income, as well as two years in prison. For Russians in Sweden, access to financing is almost closed. Only residents and firms can open accounts in a state bank; private banks do not have such restrictions but are reluctant to work with non-residents. And one more pitfall is the good financial well-being of residents is combined with high prices. Thus, both labor resources and operating costs will be much higher than, let us say, in Russia.
Baltic countries are the right place for running a business. Many people still remember the Russian language there and are generally close in mentality, and they are also usually included in the top lists of countries that are comfortable for doing business. For example, quite prosperous and technological Estonia. Non-residents can open companies here, and the form of the company is very close to Russian realities: individual entrepreneur (FIE), limited liability partnership such as LLC (OÜ), and joint-stock company (AS). FIE, like an individual entrepreneur, is the riskiest option, since the entrepreneur is responsible for his property.
The Tallinn Department of Entrepreneurship will help you draw up a business plan, and here you can get free advice on the preparation of a financial plan and forecasts. Local unemployed, as in Scandinavia, are trained to do business for free.
Loans of Estonian banks to foreign entrepreneurs are practically unavailable. But non-residents can rely on cash assistance in the amount of up to € 15,000 from the Enterprise Development Fund (EAS). The start-up subsidy is intended for enterprises with high development potential, and it should be engaged in services for the population or production. The company that received the start-up subsidies must work at least three years, otherwise, the subsidies money will have to be returned.
Austria is an exciting and promising choice of business habitat. The country is not on the first lines of business ratings but is popular among young and talented entrepreneurs from around the world. High-tech startups are actively developing here, plus, like in the Baltic countries, they are friendly towards Russians.
State support for small business in Austria is very strong. A simple company registration procedure in the form of ownership of an LLC, or GmbH, with a minimum starting capital of € 10,000, of which only € 5,000 must be paid in cash, low tax burden (single corporate tax – 25%), incentives for innovators (12% for research costs and development) – far from all measures of support for entrepreneurs by the authorities. Non-residents who plan to open a business in Austria are consulted for free by the state organization ABA – Invest in Austria, it will help with the choice of activity, organization of office work, taxes and labor law, international trade. In addition, in Austria it is convenient to conduct business from a geographical point of view, the country is a stronghold for the development of business relations with countries of Eastern and Southeast Europe, therefore, many headquarters of international corporations are located here – Siemens, Beiersdorf, Hewlett-Packard, Henkel, BMW, Shell, etc.
About the author
Melisa Marzett is a former journalist and a translator who is currently freelancing and traveling. Writing articles for <a href=»http://smartessayrewriter.com/»>http://smartessayrewriter.com/</a>, she has loved writing for her whole life. Apart from writing, reading, and traveling, she enjoys movies, sports, and fashion.