Entrepreneurs who are carrying out business activities in Estonia
are allowed to change the legal entity
under which their company
is working at the moment, in accordance with the rules and regulations imposed by the local authorities. In other words, when opening a company in Estonia
, the business is not required to be maintained under the same legal entity
until the investors choose to shut it down or to dissolve it. This option is available due to a set of factors, such as the development of the company
to an extent in which the current legal entity can no longer represent the best interests of the businessmen. Our team of Estonian company formation representatives
can provide assistance on the changing procedure.
Why change the legal entity?
The Estonian legislation
allows businessmen to change various legal entities
in other business forms
. This type of procedure can be necessary in some cases, for example, when the investor wants to have other types of obligations and rights (more or less). Over the years, the business may be better represented if it would be carried out under a different company type
A partnership in Estonia
can be changed into a limited liability company
or a corporation
. At the same time, the corporation
can be set up under other type of legal entity; our team of Estonian company formation consultants
can offer more details in this sense.
Change a sole proprietorship into a limited company in Estonia
One of the most common changes referring to the legal entity
is the transformation of the sole proprietorship
, which is the simplest type of business form, into a limited liability company (LLC)
Under the local legislation, between the investor and the legal entity
there are no difference in terms of liabilities, which means that the businessman can become liable with his personal assets for the debts incurred through the business. In order to change it
, the investor should close down the sole proprietorship
, and open a new business as required by the LLC incorporation procedure
The main advantage of a LLC is that there is a very clear distinction between the investor and the company, which is a separate entity.