1. Doing Business in the
Nordic and Baltic Region
FINLAND
Markus Myhrberg
Partner, Attorney at Law
LEXIA

2. Finland

3. Basic Facts about Finland
Size: 390 903 km²
Population: 5.4 M (18 habitants per km²)
State formation date: 6 December 1917
Capital city: Helsinki
Political system: parliamentary republic
Official languages: Finnish, Swedish
Member of the EU: since 1 January 1995
Currency: euro (€)

4. Basic Facts about Finland
GDP: $266553 M in 2011 (IMF),
37th in the world
($ 36,395 per capita, 23th)
Economy: One of the most open, competitive & successful
economies in Europe due to political stability &
sustained growth (AAA; S&P, Moody’s)
Strong in: Information and clean technology, games, paper and
metal industry, ship building, machinery, pharma and
scientific instruments (e.g. included in the Curiosity
explorer on Mars)

5. Rankings
• 3#, Global competitiveness report 2012-13 (World Economic Forum)
• Best business environment in the world (period 2009-2013, Economist
Intelligence Unit)
• The best availability of scientists and engineers in the world
(WEF)
• 7# Global competitiveness index 2010-12 (World Economic Forum)
• Best country in the world (Newsweek, August 2010)
• Best basic education in the world (PISA)

6. Finland
- Strengths -
• Expertise and innovation (among the EU’s innovation leaders)
• Unique co-operation between education, research and industry
• Great logistics and communications networks
• Transparent legislation, lack of bureaucracy
• IPR protection, signatory to all major international IP treaties
• One of the least corrupted countries in the world
• Safety, clean environment Euro as currency
• Honest and straightforward people
• Excellent geographical location

7. The finnish nature...
The Finnish nature…

8. Finland
Labour market
• Highly educated workforce receptive to new technologies (e.g. vast
amount of skilled IT-personnel)
• Applicable collective bargaining agreements (union agreements)
quite common
• Increasing flexibility one of the main objectives
• No minimum wage ruling in the law, but included in most of the
union agreements
Social system
• Comprehensive social security
• Several mandatory provisions for the benefit of employees
•22-25% of the salary to be paid by the employer as social security,
pension and other insurance costs

9. Finland
- Investment possibilities -
Industries
• Cleantech
• ICT & Games
• Mining
• Research, Development and Innovation
• Travel
• Healthcare & wellbeing
• Ship building, machinery

10. Setting up a Business in Finland
• The nationality of a foreigner determines which permits or
registrations are needed when moving to Finland
• Depending on the corporate form, a permit of the National Board of
Patents and Registration may be needed (if permanent place of
residence outside the EEA)
• In limited company (Oy) only for the board members/CEO
• Insurances and unemployment fund for entrepreneurs mandatory,
mostly do not apply to foreigners living abroad
• Business and organization ID
 provided once the foundation of a business is recorded in the
Finnish Business Information System

11. Setting up a Business in Finland
Company types
• limited company
• sole proprietorship
• partnership (general and limited)
• joint venture
different tax implications
special permits
registration procedures

12. Setting up a Business in Finland
• Share capital requirements:
• Private limited companies Euro 2,500
• Public limited companies Euro 80,000
• Board of Directors is mandatory
• minimum one member and one alternate member.
• at least one of the Board members must be EEA resident
• No directors needed, a Finnish representative required in some
situation
• CEO has to be from the EEA
• Establishment agreement between shareholders, no notary
required

13. Finland
- Taxation -
• Corporate income tax 24,5 % (as of 1.1.2014 20 %)
• Tax obligations depend on whether the company has a permanent
establishment in Finland
 mandatory registration in the Finnish VAT register if the foreign
company has a fixed establishment in Finland
 obligation to file VAT registration form in some cases even
without permanent establishment, e.g. company selling goods or
services to consumers
 employer registration: mandatory for companies with permanent
establishment in Finland for income-tax purposes the company
will be treated as a Finnish payer of wages

14. Finland
- Taxation -
• Withholding tax on dividends 24,5,%
• EEA 0% (at least 10 % ownership)
• Finnish-Russian tax treaty > 12/5% (ownership 30%, investment
more than USD100,000)
• Interests and royalties 0%
• Foreign natural persons in general > 30%
• Tax treaties > 0% (if the company has paid)
• Sale of shares made by foreign companies in most cases tax-free
under Finnish taxation
• Quite straightforward taxation system, limited possibilities to
deduction in the company taxation
• R&D deduction based on the paid salaries 15-400K
• No results needed…
• IPR Box to be introduced (royalties -50%)

15. Finland
- Working and Residence Permits -
• Residence permit is required for foreigners staying in Finland for 90
days or longer (does not apply on EU/EEA citizens and Nordic
countries)
• Residence permit for a self-employed person also required in order
to engage in trade in Finland
• Applying residence permit, permit grounds, temporary/permanent
residence permit
• Residence permit for an employed person: usually granted for a
specific occupational position/sector
• Researchers, executives, concultants, educational work etc.

16. Thank you!
Markus Myhrberg
Partner, Attorney
Mobile: +358 (0)40 505 5343
markus.myhrberg@lexia.fi