Post on 13-Jan-2015
description
Doing Business in the Nordic and Baltic Region
FINLAND
Markus Myhrberg
Partner, Attorney at Law
LEXIA
Finland
Basic Facts about Finland
Size: 390 903 km²
Population: 5.4 M (18 habitants per km²)
State formation date: 6 December 1917
Capital city: Helsinki
Political system: parliamentary republic
Official languages: Finnish, Swedish
Member of the EU: since 1 January 1995
Currency: euro (€)
Basic Facts about Finland
GDP: $266553 M in 2011 (IMF), 37th in the world ($ 36,395 per capita, 23th) Economy: One of the most open, competitive & successful economies in Europe due to political stability & sustained growth (AAA; S&P, Moody’s) Strong in: Information and clean technology, games, paper and metal industry, ship building, machinery, pharma and scientific instruments (e.g. included in the Curiosity explorer on Mars)
Rankings
• 3#, Global competitiveness report 2012-13 (World Economic Forum)
• Best business environment in the world (period 2009-2013, Economist
Intelligence Unit)
• The best availability of scientists and engineers in the world (WEF)
• 7# Global competitiveness index 2010-12 (World Economic Forum)
• Best country in the world (Newsweek, August 2010)
• Best basic education in the world (PISA)
Finland
- Strengths -
• Expertise and innovation (among the EU’s innovation leaders)
• Unique co-operation between education, research and industry
• Great logistics and communications networks
• Transparent legislation, lack of bureaucracy
• IPR protection, signatory to all major international IP treaties
• One of the least corrupted countries in the world
• Safety, clean environment Euro as currency
• Honest and straightforward people
• Excellent geographical location
The finnish nature... The Finnish nature…
Finland
Labour market • Highly educated workforce receptive to new technologies (e.g. vast amount of skilled IT-personnel) • Applicable collective bargaining agreements (union agreements) quite common • Increasing flexibility one of the main objectives • No minimum wage ruling in the law, but included in most of the union agreements Social system • Comprehensive social security • Several mandatory provisions for the benefit of employees •22-25% of the salary to be paid by the employer as social security, pension and other insurance costs
Finland - Investment possibilities -
Industries
• Cleantech
• ICT & Games
• Mining
• Research, Development and Innovation
• Travel
• Healthcare & wellbeing
• Ship building, machinery
Setting up a Business in Finland
• The nationality of a foreigner determines which permits or registrations are needed when moving to Finland
• Depending on the corporate form, a permit of the National Board of
Patents and Registration may be needed (if permanent place of residence outside the EEA) • In limited company (Oy) only for the board members/CEO
• Insurances and unemployment fund for entrepreneurs mandatory,
mostly do not apply to foreigners living abroad
• Business and organization ID provided once the foundation of a business is recorded in the Finnish Business Information System
Setting up a Business in Finland
Company types • limited company • sole proprietorship • partnership (general and limited) • joint venture different tax implications special permits registration procedures
Setting up a Business in Finland
• Share capital requirements: • Private limited companies Euro 2,500 • Public limited companies Euro 80,000
• Board of Directors is mandatory
• minimum one member and one alternate member. • at least one of the Board members must be EEA resident
• No directors needed, a Finnish representative required in some
situation • CEO has to be from the EEA
• Establishment agreement between shareholders, no notary
required
Finland - Taxation -
• Corporate income tax 24,5 % (as of 1.1.2014 20 %) • Tax obligations depend on whether the company has a permanent
establishment in Finland mandatory registration in the Finnish VAT register if the foreign company has a fixed establishment in Finland obligation to file VAT registration form in some cases even without permanent establishment, e.g. company selling goods or services to consumers employer registration: mandatory for companies with permanent establishment in Finland for income-tax purposes the company will be treated as a Finnish payer of wages
Finland - Taxation -
• Withholding tax on dividends 24,5,% • EEA 0% (at least 10 % ownership) • Finnish-Russian tax treaty > 12/5% (ownership 30%, investment
more than USD100,000) • Interests and royalties 0%
• Foreign natural persons in general > 30% • Tax treaties > 0% (if the company has paid)
• Sale of shares made by foreign companies in most cases tax-free under Finnish taxation
• Quite straightforward taxation system, limited possibilities to deduction in the company taxation • R&D deduction based on the paid salaries 15-400K • No results needed…
• IPR Box to be introduced (royalties -50%)
Finland - Working and Residence Permits -
• Residence permit is required for foreigners staying in Finland for 90 days or longer (does not apply on EU/EEA citizens and Nordic countries)
• Residence permit for a self-employed person also required in order
to engage in trade in Finland • Applying residence permit, permit grounds, temporary/permanent
residence permit • Residence permit for an employed person: usually granted for a
specific occupational position/sector • Researchers, executives, concultants, educational work etc.
Thank you!
Markus Myhrberg Partner, Attorney Mobile: +358 (0)40 505 5343 markus.myhrberg@lexia.fi