How to add a shareholder for an Estonian company?

The standard ways to add a new shareholder to your Estonian company

If you want to bring in a new co-owner then most Estonian company owners, until now, have had to arrange offline notary appointments to transfer shares. That needs to be done in Estonia with all shareholders present, which obviously comes with both hassle and cost. It’s inconvenient even if you live in Estonia at the best of times, but it’s especially inconvenient for e-residents and during a lockdown.

Why was it so tricky to transfer shares for an Estonian company?

Estonia is proud to be a digital nation where 99% of government services are online and everyone has a digital ID that can be used for authenticating themselves and signing legal agreements online. However, there are some big decisions that must still be done offline. That covers getting married, getting divorced, buying property, selling property, buying company shares, and selling company shares.

Four alternative ways to add new shareholders

1. Using an e-notary

Estonian notaries have launched an e-notary service so that company owners can visit an Estonian Embassy abroad to transfer shares, instead of at a notary office in Estonia. You can read more about this on the e-Residency blog here.

2. Managing your own shareholder list

The Estonian Parliament recently changed the law at the request of the startup sector so that shares can now be transferred to a new shareholder at the responsibility of the parties involved, if the company’s articles of association approves this. This can only be added to the articles of association if it is unanimously agreed by all existing shareholders.

3. Using NASDAQ CSD

Your company can register its shares with Nasdaq CSD, as an alternative to the Estonian Business Register managing your shareholder list.

4. The simplest way to add new shareholders for your Estonian company

There’s one more way to add a new shareholder to your Estonian company and it’s surprisingly simple. We like to keep things simple here at Unicount so we’ve tried it ourselves multiple times with our own businesses and we are aware that it has successfully worked for other startups.

Just one last issue…

There’s one thing that can make this advice a bit tricky for e-residents. The Estonian Business Register and the Tartu county court both expect your documents in Estonian.

What if I want to buy or sell an entire Estonian company?

Finally, this subject also comes up a lot in the e-resident community as people seek to buy or sell entire Estonian companies. Our advice is simple here too: Don’t.

Source:

https://unicount.eu/en/add-shareholder-estonian-company/

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