Businesses are constantly seeking new opportunities and markets to expand their operations. For non-EU companies eyeing the European market, Estonia has emerged as an increasingly attractive destination. This Baltic nation offers a host of advantages that make it an ideal gateway to the European market, ensuring simplicity, efficiency, and unparalleled access.
Here are a few reasons of why Estonia deserves serious consideration for companies looking to tap into the European market.
Simple tax system
Estonia’s tax system is a beacon of transparency and simplicity. At its heart lies a corporate income tax rate of 0% for retained/reinvested profits. This is a game-changer for business owners who prefer to reinvest their profits into their ventures. Unlike many jurisdictions, Estonia does not punish businesses for growing and thriving. Estonia encourages innovation, investment, and growth, creating a favorable environment for businesses of all sizes.
Estonia’s commitment to digitalization is second to none. The country boasts an advanced digital infrastructure that allows businesses to be managed efficiently and remotely. A key highlight is the e-Residency program, a digital identity solution that extends access to Estonia’s private and public sector services to anyone, anywhere in the world. This pioneering initiative empowers entrepreneurs to establish and manage their companies with ease, reducing the geographical constraints that often hinder international business expansion.
Ease of doing business
Estonia consistently ranks high in global Ease of Doing Business indices. The country’s streamlined and cost-effective registration process for new businesses is a testament to its commitment to fostering entrepreneurship. For non-EU companies, this means reduced bureaucratic hurdles and quicker market entry, which can be crucial in today’s fast-paced business environment.
Intellectual property protection
Intellectual property is a cornerstone of many businesses, and Estonia understands its significance. The country offers an efficient and cost-effective platform for intellectual property registration, including trademarks and patents. This proactive approach ensures that businesses can protect their innovations and brands without excessive red tape or financial burden.
Access to the EU market
Perhaps the most compelling reason for non-EU companies to consider Estonia as a gateway to the European market is its EU membership. Estonia fully applies all laws adopted by the EU, providing an advantageous bridge to the broader European market. Establishing an Estonian company effectively grants access to the EU member states, simplifying market expansion and eliminating many of the regulatory and trade barriers that non-EU entities often encounter.
No authorized capital requirement
Estonia’s commitment to fostering a business-friendly environment goes beyond tax incentives and digital solutions. Starting from February 1, 2023, the country has implemented a groundbreaking change in its corporate law that eliminates the need for authorized capital requirements. This means that founders and shareholders have the freedom to decide how much capital is necessary to start and operate a limited liability company in Estonia. In practical terms, the minimum share capital for an Estonian limited company can be as little as 1 euro cent. This progressive approach removes a significant financial barrier for entrepreneurs, allowing them to allocate resources where they matter most – in their business operations.
Avoidance of double taxation
Estonia has signed the Convention for the Avoidance of Double Taxation with a substantial number of countries, currently standing at 62. This commitment ensures that businesses can navigate complex international tax structures with ease, reducing the risk of double taxation and making it simpler to engage in cross-border trade and investment.
Remote management of companies
Estonia’s commitment to digitalization has reached its pinnacle with the introduction of the e-Residency program. For residents and e-residents alike, this program offers a unique opportunity to run companies remotely and digitally. It eliminates the need for a physical presence in Estonia, providing flexibility and convenience that is increasingly vital in today’s fast-paced and globalized business landscape. Whether you’re an entrepreneur looking to establish a new venture or an existing business owner seeking to expand into the European market, e-Residency simplifies the administrative burdens and geographical constraints, enabling businesses to thrive on their own terms.
Residence permit policies
Estonia’s appeal extends beyond business opportunities, making it an attractive destination for those looking to establish roots in Europe. The country offers various types of residence permits, including permanent and temporary options. After five years of continuous residence on the basis of a temporary residence permit, individuals can apply for a long-term residence permit through the Police and Border Guard Board. This straightforward process not only grants access to Estonia’s vibrant culture and society but also provides a gateway to the entire European Union. For non-EU citizens seeking to establish a foothold in Europe, Estonia’s residence permit policies offer a clear and achievable path to long-term residency and the associated benefits.
Estonia’s strategic location, coupled with its business-friendly environment and commitment to digitalization, makes it a compelling destination for non-EU companies seeking access to the European market. With a transparent tax system, an advanced digital infrastructure, a favorable business climate, robust intellectual property protection, and access to the vast EU market, Estonia provides a compelling proposition for non-EU businesses looking to expand their horizons.
Estonia stands out as a beacon of opportunity and a symbol of innovation and progress in the heart of Europe.