A Short Guide: Company Types in Estonia

Are you planning to open a company in Estonia? Feel free to familiarise yourself with different forms of Estonian business.

Company Types in EstoniaIn Estonia, a business establishment is not a big thing. This country is being 99% digitalised; therefore, the process of company formation and development is as simple as it could be.

Numerous advantages — favourable tax system, friendly environment, talent pool, fintech opportunities attract entrepreneurs from around the world, and thus they face a choice — to what legal entity to choose.

According to the Commercial Code, there are 6 forms of business in Estonia:

  1. Limited Liability Partnership or Private Limited Company (OÜ)
  2. Public Limited Company (AS)
  3. General Partnership (TÜ)
  4. Limited Partnership (UÜ)
  5. Commercial Association
  6. Sole Proprietor (FIE)

Foreign companies can also offer their goods or services by opening a branch in Estonia. It should be noted that the branch is not a form of entrepreneurial activity, and the foreign company is fully responsible for the obligations arising from the activities of the branch.

Limited Liability Partnership (OÜ)

  • The most common type of legal entity in Estonia
  • Minimum share capital 2,500 EUR
  • Ruled by management board (at least one member)
  • Shareholders are not personally liable for the obligations of such a company
  • Perfect for small to medium-scaled businesses
  • Set up online (Estonian citizens or e-Residents)

Public Limited Company (AS)

  • Minimum share capital of 25,000 EUR
  • Must have management and supervisory board and an auditor
  • Works for large-scale businesses
  • Ability to attract a wide range of shareholders
  • Possibility of listing the company on the stock exchange
  • Shareholders are not personally liable for the obligations of a PLC
  • Cannot be registered online but at a notary

General Partnership (TÜ)

  • No minimum for share capital
  • Based on the association agreement concluded between partners
  • Board members are liable for all assets
  • All partners share an equal amount of responsibility
  • Does not require notarisation or registration to the Commercial Register

Limited Partnership (UÜ)

  • At least one general shareholder and one limited shareholder
  • General partner will be solely responsible for the legal obligations of the company
  • The limited partner is liable up to the amount of the investment
  • Establishment online or through a notary

Commercial Association (Tulundusühistu)

  • Company aimed at supporting and promoting the economic interests of its members
  • No minimum share capital
  • If there is no personal liability of the members, the amount of the authorised capital is at least 2,500 EUR.
  • At least two founders
  • Registration only through a notary

Sole proprietor (FIE)

  • Individual entrepreneur
  • There are no requirements for the minimum amount of capital
  • Individual entrepreneurs are not required to have articles of association
  • Simple registration (online or at a notary)
  • Bank account and an Estonian legal address required
  • No need to draw up a memorandum or articles of association

Whatever business form suits you best — LKS Consult OÜ will be happy to consult and assist you.