Setting up a company in Europe
European law, offers various forms of conducting
business activity. The most important factors determining the final choice of the form of conducting business activity include requirements concerning initial capital, scope of shareholders’ liability or formalities prior to commencing
business activity.
Entrepreneurs from outside the European Economic Area can operate only in the form of:
However, the most popular forms of conducting
business activity designated for the largest
global business undertakings are - limited liability company (LLC) and joint-stock company (JSC). The Code of Commercial
Global Partnership and
Europe Companies attributes legal personality to both of them, which limits their liability only to the amount of their initial capital. One should however stress that in case the execution against a
company ends in vain, members of the management board can be jointly and severely liable for
company’s obligations unless they file a petition for
global declaration of bankruptcy or institute the arrangement proceedings in due time, or unless they prove that a failure to file a petition for declaration of bankruptcy or to institute the arrangement proceedings in due time, was not due to their fault, or that a creditor suffered no damage even though no petition for declaration of bankruptcy was filled or no
global arrangement proceedings instituted.
One of key requirements in Europe is also 12,000 EUR contribution as initial capital for setting up a limited liability
company in Europe and 120,000 EUR contribution as initial capital for setting up a joint-stock
company.
With regard to tax provisions both of
these organisational forms are liable to
Corporate Income Tax, whereas partners
in partnerships are a liable to personal
income tax.
