Starting a business in the EU
The European Union is one of the largest economies in the world. For entrepreneurs, it is one the best places to set up a company. It has a well-established infrastructure and has always been an attractive location for domestic and foreign investors as well. The number of unicorns, startups valued at over $1 billion, has increased drastically in recent years. Europe fits the requirements for potential private and public companies.
In the following text we list some points that make the European Economic Community (EEC) with its large common market a good place for trade, sales and production.
Requirements to start a business in the EU
For the beginning you need some documents. You should have a European passport or at least a work permit to start your business. You also need an address for the commercial register in the respective county. To start a business, you also need a business account. Here you can find suitable business accounts for your business.
Especially for starting a business you need information about the planned business itself. What is the nature and scope of your business? Do you have partners who will work with you? Such questions are answered in a professional business plan and the articles of association. Exactly what you need depends on the country within the EU where you plan to start your business. If you live outside the EU, you can think about it.
Choosing the right country in the EU to start a business
Speaking of countries, there are quite a few attractive ones that you can chose from within the European Union. To get an overview of what works best where, there are a lot of detailed lists available on the internet. Often, those are even ranked by certain categories that help to narrow down your options.
Depending on what exactly it is you want to do, you will stress certain factors above others. If you want to trade goods and material, maybe you will primarily look for a geographical advantage. If you look for a place where doing business is as inexpensive as possible, you will look for a country with an especially convenient corporate tax structure. There are differences between the member states. In general, you should also look at the available talent and infrastructure that is going to support your specific business idea. There are regions better suited for production while others are more convenient for technology or other branches. Doing your research really helps with choosing the right place to build your company and reputation.
For people living inside the EU, there are barely restrictions when it comes to setting up and registering a company. Whether you chose the state you live in or another one, you profit from the EU-wide freedom of establishment. This means, either you inherently already have a residence permit or a work permit for the designated location, or you do not have too many steps before you to be granted one or the other.
For people living outside of the EU, this issue can be a little or also a lot more complicated. For tips on that subject, I have already uploaded another article that deals with the concept of agency. You can find him here. That allows you to operate in another country through a representative there.
Set up your company
Once you have chosen a place, the exact process from putting together a professional and detailed business plan all the way to the final founding of a company varies from country to country. Having prepared the already-mentioned paperwork, it should be a relatively straight-forward process anywhere. There is a lot of detailed information about this on the internet. Also, when you have gone from having an idea to taking the first concrete steps, you should definitely benefit from an expert’s consultation on the matter. For basic consultation, always start by contacting the respective chamber of commerce and industry.
Long story short: Europe is an attractive location to do business. As anywhere else, there are several steps to go through before you can start. But if you have done your research and have consulted with the right people, just go for it, and take the next step.
Guide for your way into self-employment in Germany
Setting up a company in Germany is much easier than you think. For example, a new bill from the German cabinet will make it possible to form GmbHs online in the future. Moreover, the German authorities are the best in the world and will help you with any open questions. We at businessstart.eu have developed a guide with tips that you should still pay attention to. If you have any further questions, please do not hesitate to contact us at info@businessstart.eu.
1. Plan foundation: Take your time
Do you have the idea of starting your own business or taking over a company? If yes: Most likely you want to start immediately. But beware: self-employment requires a lot of commitment and the willingness to break new ground. You will be very challenged and may be pushed to your limits.
HINT: Therefore, take your time and do not rush. Do not get started until you have prepared your foundation well. Draw up a schedule for yourself.
2. Obtain information: Use existing offers
In Germany, there is a lot of information available on the subject of starting a business. There are also many public agencies that provide information about the challenges and requirements of starting a business.
HINT: First, discuss your idea with your family, friends and acquaintances. But don’t just rely on their advice and tips. Get an overview of the public information available- that’s what they’re there for. Businessstart.eu helps you with most of the important questions about starting a business, also in German or English. You can also take advantage of the mostly free public consulting services in your region. Important helpers are the Chamber of Industry and Commerce or the Chamber of Crafts. All advisors will help you e.g., determine which formalities you need to complete and what know-how you should still acquire.
3. Observe formalities: Provide proof of qualification, obtain permits
When setting up a business in Germany, you have to complete a number of registrations. In addition, for certain activities one needs a special authorization, e.g., a university education, the title of a master craftsman or instruction by the Chamber of Industry and Commerce. Before that, you are not allowed to carry out your self-employed activity. If you start your self-employment anyway, you will get into trouble with the German authorities. In the worst case, you will have to pay fines or penalties.
HINT: Do not simply launch the company. Find out about mandatory registrations and permits. The chambers of commerce and industry and the counseling centers for migrants are well versed in this area. Even if you have had bad experiences with authorities in your home country or in Germany. Approach the offices and let them support you.
4. Verify qualifications: Get your vocational training recognized
Did you complete vocational training in your country of origin? Or completed a course of study? This does not automatically mean that you meet all the requirements for self-employment. The content of your training or studies may have been different from what you have to prove in Germany when setting up your own business.
HINT: Submit an application to verify the equivalence of your professional qualification.
5. Permission for self-employment: Get the right residence permit
Do you come from a country that is not a member state of the European Union (EU) or the European Economic Area (EEA)? And you are not a Swiss citizen either? Then you need a special residence title to exercise self-employment, which allows you to exercise self-employment in Germany.
HINT: Check if you already have such a residence permit that allows you to be self-employed. If not, visit a counseling center. With their help, apply to the foreign authority for another residence title or for an extension of your current residence title.
6. Build business relationships: Prepare well
After the foundation, it is important that you build good relationships with your customer and with your business partner. In Germany, private and business matters are often separated and the first conversations with German business partners are often very businesslike.
HINT: Prepare well for the interviews. Don’t be surprised if things „get down to business“ right away. It is helpful if you write down your concerns and questions beforehand.
