Opening a subsidiary in Liechtenstein is an exciting time for growing companies. However, the entire setup process can take months, potentially delaying operations and market entry. Understanding options around subsidiary setup before entering the market can help companies ensure they are making the best decisions for their organization.
How to establish a Liechtenstein subsidiary
Companies will need at least 45 days to establish an entity in Liechtenstein as well as a minimum deposit of CHF 50,000 at a local bank as paid-in capital.
Additionally, companies need to decide what type of business they want to establish. A standard option that often fits requirements is the Aktiengesellschaft, a joint-stock company.
Subsidiary laws in Liechtenstein
National legal standards provide a framework for the subsidiary establishment process, but companies should do their due diligence to determine requirements for the target region. They should follow these main steps.
- Choose and reserve a company name.
- Prepare and pay the minimum share capital.
- Register the company before the Liechtenstein Commercial Register.
- Obtain a trade license. Before companies can incorporate their business, they must apply for a trade license online through the Office of Economic Affairs. This step will cost around CHF 600 and may take up to 30 days.
- Have a registered address.
- Incorporate the company.
After legalizing all co-founders’ signatures at the court and selecting an auditor, companies can go to the Commercial Register for incorporation. Companies must provide several key pieces of documentation, including a declaration of formation, a declaration of acceptance by the selected audit firm, proof of the paid-in capital from the bank, and a corporate signature by the directors and managing director.
Companies must have the resources ready to pay the following fees during this step:
- A general charge of CHF 700 for 2 excerpts
- CHF 15 for additional excerpts
- CHF 20 for each director
- CHF 30 for each address
- A minimum share capital of CHF 30,000 for a limited liability company
Companies may need to pay additional fees depending on the size of the company and the capital.
Benefits of establishing a Liechtenstein subsidiary
With a maximum income tax rate of 20% and a slew of tax and investment agreements, Liechtenstein offers many key benefits to global businesses. Some companies scaling globally choose to establish a subsidiary to act as a legal presence in the country. This option allows them to hire local employees, engage with the economy, and manage other essential operations. A subsidiary also reduces risk because it has a separate legal status from the parent company.
However, a subsidiary may not be feasible or ideal for some companies, as establishing an entity in another country takes sizable financial resources and time as well as a long-term commitment to the region.
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