Doing business in Finland is easier and safer from a legal and bureaucratic point of view than in most other countries. According to the report Doing Business 2019 published by The World Bank that measures the ease of doing business in 190 economies, the country occupies the 17th position in the world. Still, this doesn´t mean that all the process is free of complications.
The World Bank investigates in this dossier the regulations that enhance business activity and those that constrain it. In its more than 300 pages it analyses quantitative indicators on business regulation and protection of property rights such as starting a business, the labor market regulations, the taxation system, the facilities to process construction permits, getting electricity, registering property, getting credit, protecting minority investors, trading across borders, enforcing contracts and resolving insolvency.
From the European Union perspective, the Doing Business dossier concludes that Finland is the fifth easiest and safest country to establish a company in EU. The Finnish economy is in this sense surpassed by Denmark, that occupies the ranking’s third place, United Kingdom (9), Sweden (12) and Estonia (16), but is also far ahead of European giants such as Germany (24), Spain (30), France (32), Poland (33) and Italy (51).
The 2019 edition of the report highlights the contry’s efforts to make paying taxes less costly by reducing the labor contribution rates paid by employers and by introducing a new and more efficient online portal, named MyTax, for filling corporate income tax returns. In this sense, the World Bank places Finland at the ranking’s eleventh position when measuring the paying taxes facilities. It is also the second easier when it comes the time to resolve insolvency.
Time to set up a company
But not all the results are so good. On the other hand, starting a business in Finland requires more time than the average of OECD high income countries.
The World Bank ranks the country as the 43rd when measures the time needed to set up a company. According to The World Bank, in Finland the period needed is 17 days, above the average of the OECD high income countries, 9.3 days.
In general, the timing in Finland goes as follows: 1 day is needed to deposit the paid-in share capital in a bank, pay the registration fee and get a receipt; 15 days to submit a single start-up notification form to the National Board of Patents and Registration (PRH) and 1 more day to register to the Tax Administration and for VAT registration.
The report considers that another day is necessary to file at a private insurer for pension insurance, accident insurance, and medical insurance of employees if they exist, but this extra day is not included in the summa because it can be done simultaneously with the previous procedures.
This is a long period, especially if one takes into account that the number of administrative procedures that have to be fulfilled in Finland to setup a company is surprisingly low, only three, compared to the average 5 in the OECD.
Just 7 days in Sweden
In Germany, for example, setting up a business requires 9 procedures and is more complicated, but there the process just takes 9 days on average. In Sweden entrepreneurs need just 7 days to start operating and three legal procedures; in France are needed 4 days and 5 administrative procedures and in Spain 13 days and 7 procedures.
Finland is ranked as the 25th country in the world when comes to measure the ease for getting electricity, the 28th for registering property and the 34th for trading across borders and for dealing with construction permits. Nevertheless, the Finnish economy drops to the 46th place on the list when measuring the ease to enforcing contracts. It is the 60th country on the ranking for getting credit and the 72nd in protecting minority investors.
