6 tips on opening business abroad

It will take some time to transform your business idea from a concept to a real enterprise designed to make money.

We prepared a detailed guide for the steps you should take to launch your foreign business.

Choosing your jurisdiction

The country of registration may influence your clients, partners, and potential investors. It would be difficult for you to attract money or sign long-term agreements if your business is located in an unreliable jurisdiction.

This is the key point of your business journey. It will decide a lot of things for you, to name a few: 

• the ability to provide certain services or sell particular types of goods;
• the amount of taxes you pay and how you can pay less legally;
• the terms of opening bank accounts;
• compliance requirements of business and its corporate structure;
• the conditions of obtaining residency.

Your choice should be based on several factors defined by answering such questions:

• Are your clients individuals, companies, or both?
• What is your expected yearly turnover?
• Do you plan to deal with goods or services?
• Is your business innovative or tech-connected?
• What is the political situation in the country?
• Do you plan to invest the money in your business or extract it as dividends?
• How often do the laws governing your business change?

The checklist for a perfect jurisdiction can go on even longer, so you should discuss all the preferable choices with specialized legal advisers.

We closely work with our partners from some 20+ most common countries for doing business abroad and can consult on even certain exotic ones. 

Providing necessary documents

After you successfully selected the jurisdiction for your company, you have to complete certain important points before you actually start your business. Each country has a list of necessary documents for different types of businesses.

 In general, the set of papers should include:

• passport copies (both national and foreign) of all owners, shareholders, and directors;
• personal data of all owners, shareholders, and directors;
• corporate and statutory documents;
• proof of business address.

All these and other documents would be translated, apostilled, and notarized where it is needed.

Make sure they are authentic and have no mistakes, as any flaw can prevent you from having your business registered in time. Submitting wrong documents or raising fraud suspicions can result in severe sanctions and even blacklisting you from opening any business in a specific country.

Looking for onsite support

It is common to appoint a local resident as a director of the company, as some countries have it as a requirement to start a business. This option is often considered by entrepreneurs who don’t plan to live in the country of business registration.

But if you plan to be personally involved in your business, you have to consider it in the beginning while selecting the jurisdiction.

In addition, some countries require you to find a registered agent that will provide all communications with state authorities and conclude notarization, translation, and submission of documents.

Fortunately, we have an established network of our partners in many countries worldwide that will help you to launch your business faster and meet all requirements.

Collecting enough money

Your business strategy should include a financial plan. You have to calculate all your expected expenses and reserve some money for the first few months.

Here you can find several tips for consideration.

Most jurisdictions require you to have a certain amount of share capital, while in some of them you also need to add some money to the stake each year. 

The whole process of business creation also includes administrative fees for state services of registration, translation, and notarization, as well as further IP registration and licensing, and some of these payments can be really costly.

Other expenses vary depending on your type of business and may include:

• rent and utility payments for offices and other premises;
• wages;
• certain advance payments;
• purchasing technical and IT equipment;
• legal and accounting services.

Applying for residential status

Next, you should work on your arrival in the country if you plan to do your business locally. In the process of business creation, you often have to show the authorities that you have a real presence in the country. 

With the documents confirming your business purpose prepared, you have to apply for a temporary residence permit or timely visa that allows you to legally stay in the country for a while and follow the launch of your company. 

To obtain a permit, you should fall under certain criteria, and business creation is one of them. The process of application is typically available via Internet, so you can proceed with it beforehand and by the time it is finished, you will be ready to move abroad.

As the initial residence permit is temporary, it can last from a few months to one or several years, depending on the state legislation. As its duration is close to expiration, you have to file an application for its extension or for receiving a permanent residence permit.

If you fail to follow the rules of receiving residential status, you may lose the right to live in the country and even the opportunity to apply for another permit. So you need to be very careful and keep an eye on the deadlines.

Opening bank account

This is another vital point to finalizing your business launch abroad. You will need a bank account to make and receive payments, accumulate share capital and receive loans.

By the way, many countries offer certain credit programs for foreign startups, so you should select your bank considering what you can additionally receive from it.

Here is a list of documents you need to prepare to open a bank account:

• personal documents for all members of the company;
• information about the financial flows of the company
• information about your partners and clients
• information about you and your business;
• documents confirming the source of the owner’s funds;
• financial and incorporation documents for the company to open a corporate account.

This list is not exhaustive, as each bank may establish its own required documents.

The bank checks your information very thoroughly, so you need to be sure that you submit everything properly, and you can disclose everything. One suspicious moment, an unscrupulous contact, or a “gray” transaction — and you may receive a refusal.

Finally, you have got everything arranged and prepared, and your business has been successfully launched. There is still a lot to do next, and we will be happy to describe further possible steps for doing business abroad in our future articles.