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The life of e-residents just got more complicated
On 15th of January 2018, Commercial Code amendments regarding juridical persons and their availability requirements came into force. Before, the Commercial Code said, that if the residence of at least half of the members of the management board of a private limited company, a public limited company or a branch are not in Estonia, in another Member State of the European Economic Area or in the Swiss Confederation, the private limited company, the public limited company or the foreign company shall appoint the contact person, whose address is in Estonia and who has a right to receive documents on behalf of the company.
That means, that an owner and the only member of the board of an Estonian business, could operate in Estonia freely if they had residency e.g in Malta, Romania or Portugal. The new amendment introduces the term contact person. That means, that if the management board or a substitute body, is located in any foreign country, the company must appoint a contact person, who must have an Estonian address and who has the right to receive procedural documents and the declarations of intent addressed to the company.
From 1st of September 2018 (incl) every company must publish their information about their ultimate beneficial owners (UBO). When it comes to companies, UBOs are considered to be physical persons, who directly or indirectly own the company. Direct ownership means that the physical person has more than 25% of the participation or ownership rights. Indirect ownership is when more than 25% of the participation or ownership rights are owned by another company, which is controlled by the physical person – the UBO.
Read moreFrom 1st of September 2018 (incl) every company must publish their information about their ultimate beneficial owners (UBO). When it comes to companies, UBOs are considered to be physical persons, who directly or indirectly own the company. Direct ownership means that the physical person has more than 25% of the participation or ownership rights. Indirect ownership is when more than 25% of the participation or ownership rights are owned by another company, which is controlled by the physical person – the UBO.
Authors:
VEIKKO TOOMERE
Attorney at law, Partner
Direct: (+372) 66 76 446
Mobile: (+372) 50 45 211
vt@njordlaw.ee