To open a branch in Slovakia is the alternative how to wide your mother company abroad. It presents the original company and the foreign corporation is liable for all the debts and liabilities of its Slovakian branch. Expanding a company’s operations through a Slovak branch in 2021 can be perceived as one of the most current tendencies of creating a satellite company.
If you decide to open a branch in Slovakia, your branch will need to be registered with the Slovakian Commercial Register. An individual will act as the branch representative in Slovakia (branch manager).
The advantages of opening a branch in Slovakia are faster registration, less operational costs and no requirements for a minimum share capital. The branch office has access to the country’s network of double tax treaties.
Foreign investors in Slovakia can choose between a subsidiary or a branch. Their decision usually depends on the size of the company, its budget to enter the Slovakian market and the field of the activities that will be performed in the country.
The difference between a branch and a subsidiary is that the branch is not a separate legal entity from the foreign company but the requirements for doing business are almost the same.
Foreign companies operating in Slovakia
Under the Company Law, foreign companies can set up three types of legal entities: the subsidiary, which will operate under the Slovak legislation entirely, the branch office which must respect the legislation in Slovakia and the parent company’s country of origin, and the liaison office which is not permitted to complete commercial activities.
Out of all these entities, the branch office offers the highest degree of control to the parent company. A Slovak branch office is not allowed to complete any other activities than those of the parent company’s. The foreign company has all management decisions in respect to the operation of the branch office in Slovakia.
Why open a branch in Slovakia in 2021?
– a branch office has total control to the parent company over the branch office registered in Slovakia;
– a branch office has lower registration costs than a subsidiary;
– the branch office can take advantage from Slovakia’s double taxation agreements;
– the licensing requirements are less stringent when establishing a Slovak branch office;
– a branch office has lower annual maintenance costs than a subsidiary,
– there are no requirements for a subscribed share capital at registration.
If you want to open a branch in Slovakia, you can ask for recommendations from our consultants who can provide you with detailed information about formation of a branch office for your successful start up in business. They will consult with you your requirements for setting up a branch, prepare all necessary documents for establishing of a branch and register your company at Business Register, Trade Register and the Tax Office to the payment of income tax. The whole registration procedure of a branch office in Slovakia takes from a couple of days to one month (it depends on the necessary type of trade license)
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