Estonia has emerged as one of the top tech company formation destinations. Its open arm tech policy and EU membership benefits make it a preferable jurisdiction for new blockchain/ICO start-ups.
Tech and Blockchain in Estonia
The Government of Estonia currently uses blockchain technology within their national health system, legislative, security and commercial code system. The Government is planning to expand into new areas where the technology will strive.
Estonia Blockchain Legislation
There is a range of legislation in Estonia which affects the incorporation and running of a blockchain/ICO company.
Estonia Cryptocurrency Licensing
Estonia is the first nation to bring in specialist licensing for cryptocurrency exchange and wallet services. The license is split into two categories:
- A licence for a provider of a service or exchanging a virtual currency against a FIAT currency
- A licence for a provider of a virtual currency wallet service
The licence is issued by an independent unit of the Estonian Police and Boarder Guard Board called the Estonian Financial Intelligence Unit (FIU). The licence qualifies the company as a Financial Institution; this does not require any special reporting to tax authorities. Although, the FIU can make inquiries regarding the business activities the company.
Official Document Requirement
In order to gain an Estonian cryptocurrency licence the company directors, shareholders and points of contact must provide the following documents to the Estonia FIU:
- Criminal record check from their resident country
- Scanned copy of Passport
All documents must be translated into English, certified and apostilled. The documents should not be older than 3 months.
The FIU may request additional documents such as:
- CV/resume of all directors and shareholders
- Description of planned business activities
Licensing Process
To apply for an Estonian cryptocurrency licence first you must have a registered Estonian OÜ company. We can incorporate a new Estonian OÜ or you can purchase one of our ready-made Estonian companies. We only provide a licensing application for companies incorporated through our services.
The authorities usually take 4-6 weeks to process the application. Additional information may be required to complete the application process.
Company Shareholders for License
Although corporate shareholders are allowed for the incorporation of an Estonian OÜ we would suggest avoiding using one if you wish to gain a cryptocurrency license. The Financial Intelligence Unit (FIU) requests criminal record checks for shareholders so if a shareholder is a corporate entity this document may not be possible to provide especially for offshore companies.
Estonia Company Formation Advantages
Estonia is one of the most welcoming blockchain/ICO company formation destinations in Europe with a favourable tax system and easy to use filing system.
Company Type
We suggest incorporating a Limited company instead of a foundation for blockchain activity. An Estonian OÜ provides limited liability so if the company fails the directors’ personal assets are protected from creditors.
Tax Advantages
Estonia has a very unique tax system in which corporations only pay taxes on distributed dividends. As long as the profits remain within the Estonian OÜ company then there is no requirement to pay taxes on profits or investment. The tax on distribution dividends is 20%.
Online Facilities
An Estonian OÜ may run entirely online using their digital identity which minimises cost and hassle. The Estonian government has minimised bureaucracy by using a modern e-solutions method. Therefore allowing all company documentation such as tax claims to be completed online.
Ready-Made Estonia Companies
We have Estonian OÜ ready-made companies available for purchase. A ready-made Estonian company can be transferred within one day, with only the shareholders and directors information requiring change. Our ready-made Estonian companies come with VAT registration included.
Company Director
Only one director of any nationality is required to incorporate your OÜ company. Although it is required that the company has a resident person/point of contact within Estonia. If required we can assist with a point of contact
Company Shareholders
Only one shareholder of any nationality is required to incorporate an OÜ in Estonia. Corporate Shareholders are permitted in Estonia, but we would not recommend them as they may hinder you in obtaining a cryptocurrency license.
Share Capital
The minimum share capital of €12,000 is required to incorporate an OU. The share capital must be submitted in order for the application to be processed.
Estonia Registered Office
An Estonian company must have a registered office address within Estonia; we can provide this service. This office merely acts as a location where documents can be sent from the Estonian company registry for instant reminders of upcoming filing requirements.
Estonia Incorporation Process
A director or a representative must be present to sign the incorporation documents with a notary. To complete this requirement we suggest a visit to Estonia. We can assist to make sure that the visit is quick and simple with all documents being signed in one day.
Even though a visit is not technically required it will ease the process of incorporation. If a visit is not possible then there is an alternative to hand power of attorney (POA) to our Estonian partners.
For further information on our POA service please contact us.
After Estonia Company Formation
We offer a company document package for recently launched/incorporated blockchain companies. This package offers all documents required for any potential licenses or bank accounts. For further information regarding our Estonian company documents please visit our page.
Bank Account
An Estonian Bank Account is not required to incorporate a company or gain a cryptocurrency license. We have partnerships with a range of European Bank account providers and can assist with obtaining a bank account. Although we can not guarantee successful we have a high success rate.
Our Services
We offer a reliable and efficient way to form a blockchain company including Estonian company formation, banking setup & a host of corporate services. To incorporate a company using our services please complete our order form.