Frequently asked questions

21. What is the difference between founder, owner and director?

Founder of the comapny

As a rule the founder is a person (legal or private person) who is the first owner of the company at the moment of incorporation. Therefore the founder of the company never changes as the first owner(s) is alaways called founder(s).

Owner of the company

When the first owner (founder) transfers the share to somebody then the founder is not any more the owner, can not act as a shareholder and control the company. Hereinafter only the current owner have full contol over the company and only he can appoint board member(s) (called also board of directors).

Board member (director) of the company

As a rule only board members are lawful representatives of the company. However in small companies usually owners appoint themseleves as board members and therefore it seems that owners (shareholders) can represent the company. If owners (shareholders) are not board members they can only represent the comapny if the board member issues them a Power of Attorney (POA).

A shareholder (owner) who is not a board member exercises its rights only at the general meeting of shareholders.

20. Must an Estonian company have a seal(stamp)?

In Estonia a company seal is not required. It is enough when documents (contracts etc) are signed by the board member of the company who is registered in the commercial register or by an authorised person who has been given a power of attorney by a board member of the company. Entries in the commercial register are public. Everyone has the right to examine the business files, and to obtain copies of documents in the business files.

This means that the information in the register is valid and third persons can rely on that information when signing contracts etc. Since year 2000 persons who have an Estonian ID card can sign almost all  documents also digitally. Digital signature is equal to notarized signature.

The requirements for certifying documents may differ from country to country, so if a company seal is needed in some country we can order it for You.

14. What is the share capital of a ready-made Estonian company and where it is?

How big is the share capital of a ready-made Estonian company?

The minimum share capital of a ready-made company is 2500 EUR. As a rule the share capital has been paid in fully with monetary contribution by our founder company (KRM Holding Plus OÜ) to the start-up bank account of the company before company registration.

Where is the share capital at the moment of transfering the company to a new shareholder?

Usually at the moment of transfering the company to the new shareholder the share capital is in cash position and the bank account is empty.

In this case we agree in the share purchasing contract that the buyer has recieved 2500 EUR from the cash position and we have recieved 2500 EUR from the buyer for the company share. We do not transfer money back and forth but only change papers.

In other words in share sales agreement:

1.    The seller KRM Holding Plus OÜ confirms that the purchase price 2500 EUR for the company share is fully paid by the buyer.

2.    The buyer confirms that he has received the share capital 2500 EUR, which is in cash position.

12. Can anybody be the management board member of an Estonian company?

A member of the management board must be a natural person with active legal capacity.

If the place of residence of at least one-half of the members of the management board is not in Estonia, in another Member State of the European Economic Area or in Switzerland, then the company must appoint a person in Estonia who has the legal right to receive official documents from the authorities. This person will be registered in the Commercial Register. KRM Advisor can act as receiver of official documents

11. How many management board members are required for an Estonian company?

The management board may have one member (director) or several members. A member of the management board does not need to be a shareholder.

A member of the management board must be a natural person with active legal capacity.

If the place of residence of at least one-half of the members of the management board is not in Estonia, in another Member State of the European Economic Area or in Switzerland, then the company must appoint a person in Estonia who has the legal right to receive official documents from the authorities. This person will be registered in the Commercial Register. KRM Advisor can act as receiver of official documents