What are the benefits of business immigration to Sweden?
TL: You recently spoke at the Intax Wealth Latvia conference about business immigration to Sweden. What are some possible scenarios for business immigration to Sweden?
MS: There are different scenarios for business immigration and it depends on goals of the business owner:
- move to another country but keep control over existing business
- sell out the business and start a new project in a better economic environment
- secure family future in a supportive environment
- compliance with the home country legislation (CFC rules)?
Anyway, the aim of business immigration is to build an alternative center of personal vital interests.
TL: What are the benefits of immigrating a business to Sweden?
MS: Why Sweden? Well, it is a modern, free and open society with safe and positive environment, innovative and competitive economy. Sweden has strong and reliable banking sector, independent court and effective law enforcement system.
And it's important for entrepreneurs; English is fluently used by most people.
The main benefits for business immigration to Sweden are:
- moderate initial expenses: NO requirements to own a property, NO requirements for the turnover of the company
- relatively new business destination within EU with competitive corporate taxation and positive international image
- welfare and Scandinavian way of life: high level of prosperity, business flexibility, work-life balance, family life and leisure
TL: What do international businesses need to know before immigrating to Sweden? More specifically, what is the residence permit process, and is citizenship status also an option for these business owners?
MS: There are two general scenarios to apply for a residence permit in the country by setting up a company:
- as a Self-Employed / Entrepreneur - additional requirements are applies, more paperwork & time
- as a Company Officer - much easier and faster procedure
A work permit is needed to act as a company officer. Work permit for a period exceeding 90 days is simultaneously a residence permit - temporary residence permit. As a rule, the first temporary permission is valid for a year and 2 years in case of subsequent renewal. Application for an extension must be applied 1-2 months before the expiration of the temporary permit. Temporary residence permit may not exceed 4 years in total, then there will be a possibility to apply for a permanent residence permit.
A request for citizenship can be applied after continuous stay in Sweden for 5 years
The basic requirements for the application process are: a) having a permanent residence permit, b) maintaining a decent lifestyle, c) lack of serious offenses.
The main benefits of Swedish citizenship are:
- Dual citizenship is allowed
- No visa is required for entering to 173 countries
- Living and working in other EU countries
- Easy rules for residence in Switzerland, Liechtenstein, Norway and Iceland
TL: Is a limited liability company the most common legal form of business organization in Sweden? What are the conditions needed to be met for an international company to qualify as a limited liability company in Sweden?
MS: Yes, the most common legal form of business organization is a limited liability company (Aktiebolag or AB), where shareholders are not personally liable for the obligations of the company.
Swedish company Managing Director must be a resident of the EEA. If none of the company representatives is a resident in Sweden, Director / Board of Directors must appoint an authorized person, a resident in Sweden, as a contact person for communication with the authorities of Sweden, on behalf of the company.
There are no restrictions on the number or citizenship of company shareholders. Shareholders have the right to regulate their relations in accordance with private, non-public agreements or to a certain extent, in accordance with the Articles and / or Memorandum of Association. All shares have equal rights, unless otherwise provided in the Articles. The Articles of the company can define different classes of shares, i.e. different rights to participate in the assets or profits of the company, multiple voting rights, etc. Private companies must have a paid-up share capital of at least SEK 50,000 (circa EUR 5,500).
TL: An increased number of businessmen have recently been trying to leave Russia, presumably in light of President Vladimir Putin’s role in the dispute with the West over Ukraine and the uncertain future for businesses in Russia. Many of those companies are now looking to immigrate to Sweden. What are your thoughts on the current business crisis in Russia, and what are the benefits to having more Russian companies immigrate to Sweden?
MS: In general, business does not like instability and uncertainty. Also quite strong CFC rules will come in force in Russia in 2015 will be the reason for next wave of business immigration. Unpredictable taxation environment, issues with independent judiciary, law enforcement effectiveness and property rights protection, large-scale corruption - the overall cost of doing business and risks are too high for the time being. These are the main reasons why much more business owners are thinking to change their residence country.