PROCURATORS


  • We are a couple of founders applying to the e-Residency card and our objective is to incorporate our start up (Private Limited Company) via the portal in Estonia.

    Some of us will not have the chance to get their e-Residency card soon because the nearest embassy to get the e-Residency card is several thousands Kms from home, like for example for our partner from Columbia who needs to fly to NY or Brasil to receive his e-Residency card.

    As we move forward with our venture project development, we would like to know whether some of our founders who have already received their e-Residency card can be registered PROCURATORS for those who will get later their e-Residency card?

    More specifically we are A, B, C and D founders respectively from Switzerland, Singapore, California and Columbia. A and C have received their card, B and D will get it later (most likely in few months).

    Can we right now register our company via the portal without any Notary requirement where:
    A in the petition will be also registered as PROCURATOR for B
    C in the petition will be also registered as PROCURATOR for D

    Thanks for any information and/or pointer to someone else who can help on this topic


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  • Dear Raymond,

    I will look into the matter and provide an answer within this week.

    Information posted above is intended as a general guide and does not constitute legal advice.



  • @Tark-Grunte-Sutkiene
    Thank you and looking forward to reading your input



  • Dear Raymond,

    Unfortunately you cannot register a company via the company portal using representatives. A private limited company can be registered electronically only if all persons related to establishment (members of the management board, founding members, etc.) can sign the documents digitally. This is required because in case of online registration, all founders must sign the articles of association themselves (Articles 53(4)(8) and 139{1}(4) of the Commercial Code).

    Given the above, it seems most reasonable to wait until B and D have received their e-residency cards. Alternatively, you can go ahead and register your company. However, in this case, transferring shares in the company to B and D may become problematic as this would require a notarized transaction.

    Notarization of the transaction is not necessary in case the shares of the company have been registered with the Estonian Central Securities Depository (ESCD). This is possible only in case the shareholders have opened securities accounts in which to hold their shares. Today, under the current know-your-customer rules, Estonian banks cannot open a bank account (and therefore, a securities account) for anyone outside the European Economic Area without face-to-face identification. However, an amendment has been proposed (and will likely pass) whereby the know-you-customer rules would be relaxed, allowing for identification e.g. via Skype. Keep in mind that as this requires a political decision by the parliament, one can never be absolutely sure that it will indeed become law.

    In addition to the above, please note that an Estonian credit institution may open a bank account via the Company Registration Portal in the name of the company being founded only if the monetary contribution is made through a bank account opened in another Member State of the European Economic Area and the cash stands on the account until the company has been entered in the Commercial Register. Given that none of the countries listed (Switzerland, Singapore, USA, Columbia) are in the European Economic Area, be advised that you would also need to open a bank account in an EEA country before online registration is possible (most likely any of the EU countries surrounding Switzerland).

    Hopefully the above has been helpful.

    Information posted above is intended as a general guide and does not constitute legal advice.



  • Thank you @Tark-Grunte-Sutkiene for the insightful answer.

    We are a bit concerned about the constraints, not because of the "know-your-customer" rule, although none of us is living in an EU country, France is just few thousands meters from where I live in Switzerland and going to Tallin is not an issue, I am impatient to make my first visit in Estonia.

    I have read your answer in this post https://community.eresnetwork.eu/topic/73/vesting-in-estonia about founders consideration for vesting stock with cliff period what is certainly the "best friend" in doing a startup today, we need to well understand the convertible bond mechanism and hope it's a actually flexible and easy way for vesting shares with a given cliff as we also intend to follow this rule.

    Again thank you. Ray



  • Raymond,

    Further to the above, I have looked into the possibility for you to register the company () in Estonia in the "traditional" way, i.e. through a notary public.

    In order to establish an OÜ, the founder should visit an Estonian notary. If the founder is not willing to visit Estonia to sign the incorporation documents in the presence of the Estonian notary, the founder may issue a power of attorney to his or her attorneys or to any other local person for carrying out the incorporation procedures in its name. The power of attorney must be notarised and, depending on the country of issue, legalised or apostilled.

    The following main steps need to be taken and documents prepared:

    • A foundation resolution is signed by the founder or the representative of the founder. Articles of association of the OÜ will be appended to the foundation resolution. The foundation resolution must be notarised by an Estonian notary public;

    • An application with the commercial register for entering the OÜ into the register is signed by the member(s) of the management board of the OÜ. This application must be notarised either by an Estonian or foreign notary. Depending on the country of residence of the members of the management board, the application may need to be legalised or apostilled.

    • The founders must open a start-up bank account in an Estonian credit institution (SEB, Swedbank and Nordea are the largest) for the OÜ. In order to open the account, the founders must be physically present at the bank in Estonia. The bank will require certain documents regarding the founder(s) and the OÜ for opening an account. The nature of required documents will depend on the country of residence of the founder(s), whether the founder(s) are individuals or companies, etc.

    • A bank certificate evidencing the payment of the monetary contribution in the minimum amount of EUR 2,500 must be obtained from the bank. The monetary equity contribution must be paid in full to the bank account of the OÜ prior to filing of the incorporation documents with the commercial register. Once the monetary contribution is paid in full, the bank issues a formal certificate confirming that the monetary contribution has been paid in full. This certificate is appended to the application filed with the commercial register;

    • If a non-monetary contribution is made in the course of incorporation (by contribution of securities or other assets), then it is necessary to draft an agreement for transfer of the non-monetary contribution between the founder(s) and the OÜ. Also, the management board must confirm that (i) the non-monetary contribution has been transferred to the company, and (ii) its value is sufficient to cover the nominal value of the shares of the company (at least EUR 2,500).

    • Submission of the application and the foundation resolution for registration of the OÜ in the Estonian Commercial Register through Estonian notary. The application must include certain information about the OÜ (e.g. contact details, main field of activity), the shareholders (e.g. names, personal ID or register codes) and the members of the management board.

    Companies are generally registered within five business days from submission of their documents to the Commercial Register. OÜ is considered established as of registration in the Estonian Commercial Register.

    The notary fee for notarisation of the foundation resolution depends on the size of the share capital of an OÜ and the number of founders. Notary fees for establishing an OÜ with the minimum capital and one founder amount to approximately EUR 50. There are some smaller notary fees related to the preparation of notarised copies of the foundation resolution. The state duty of EUR 145 for registration of the OÜ in the Commercial Register. Other fees and costs include, inter alia, legal fees, bank fees for opening an account for the OÜ, fees for translation of documents.

    Should you find the above a suitable way forward, we would be more than happy to assist you in the matter.

    Lastly, should you have any follow-up questions with regard to vesting, please do not hesitate the ask them in the referred topic.

    Information posted above is intended as a general guide and does not constitute legal advice.



  • thanks @Tark for all the information. Obviously, we prefer to read your other post here https://community.eresnetwork.eu/topic/90/e-residency-more-readily-available since we believe that notary requirements and/or other complications can make the concept far less attractive


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