14.07.2022

Estonian e-Residency program – how it works?

Kancelaria Prawna

Entrepreneurs thinking of setting up or expanding their business on preferential terms should consider the Estonian market. Why? Thanks to the e-Residency program, which has been operating in the country for almost eight years, running a business is extremely easy.

How does the e-Residency program work?

The e-Residency program offered by the Republic of Estonia provides simple and secure access to digital services, enabling so-called ‘hand-offs’ of various types of matters (relevant to entrepreneurs) via the Internet. It is thus a convenient way to do business regardless of the physical location of the company. The e-Residency can be described as a ‘digital ID card’ issued by the Estonian authorities to non-citizens of this Baltic country, giving access to a range of Estonian e-Services.

How does the qualification process for the e-Residency programme work?

The registration procedure takes place almost entirely remotely, and the decision to grant the e-Residency card itself, if the formalities are properly completed, is taken within a month. One of the conditions of eligibility for the program is that the company must be established in the European Union; this means that the program is open to entities that have registered their business in the community. What steps should an entity interested in obtaining an e-Residency take?

  1. An application should be submitted online via the application site of Estonian Police and Border Guard.
  2. The next step is to visit one of the Estonian diplomatic missions or the point of the Estonian Police and Border Guard to collect the card confirming the acquisition of e-residency.

After receiving the E-residency card, the entity can perform formal operations, related to the day-to-day management of the company. It is therefore an extremely simplified process compared to other business establishment models.

 

Incorrect assumptions about the e-Residency program

It is worth remembering that e-Residency and residency are two very different concepts. One refers to where a person is obliged to pay taxes and the other is the name of a government programme and a technological solution. Therefore, before proceeding with the qualification process, it is important to consider that e-Residence:

  • is not a citizenship, a tourist visa, nor does it guarantee entities permanent physical residence in Estonia,
  • nor does it affect international obligations such as taxation. Entities using the e-Residency programme are obliged to pay taxes in the country where they physically operate,
  • Estonia is a country with one of the most trusted business environments in the world, so the e-Residency programme should not be compared to an ‘offshore system’; nor is it designed to exploit so-called ‘loopholes’,
  • activities qualified and carried out under the e-Residency programme are not, by definition, a ‘virtual company’.

Summary

Doing business in Estonia – thanks to the e-Residency programme – is much simpler vis-à-vis other countries and fully secure due to the easy and transparent qualification process. Our law firm KWKR Konieczny Wierzbicki and Partners is also a member of this programme, providing legal services in the field of relocation of business activities to Estonia. We encourage you to take advantage of our support.

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    Do you want to be up to date? Sign up for our newsletter

    By subscribing to our newsletter, you consent to the sending of information by e-mail on important events in the field of law, legislative changes and the activities of the Law Firm.

    read more

    The administrator of your personal data is KWKR Konieczny Wierzbicki i Partnerzy S.K.A. with headquarters in Krakow, ul. Kącik 4, 30-549 Krakow. Your data will be processed for the purpose of sending our newsletter. You have the right to request access to your personal data, their copies, rectification, deletion or limitation of processing, as well as the right to object to the processing and to lodge a complaint with the supervisory authority. More details can be found in our Privacy Policy.