If you want to start a business in Sweden, different rules apply depending on your citizenship, the form of business chosen and whether you intend to live in the country.
Legal forms for businesses
Companies can take the following legal forms:
A sole trading company is a type of company in which there is no clear division between you as an owner and the company itself. You are personally liable for the company’s debts.
Operating as a sole trader may be right for you if you want to start a business on your own. A sole trader business is always owned by one person. Spouses or couples with children can run sole trader businesses together.
Partnerships and limited partnerships (handelsbolag / kommanditbolag)
A partnership must have two or more partners. They may be private individuals or companies. A partnership is a legal entity.
The partners decide who will have the right to represent the company and enter into agreements on behalf of the company as an authorised signatory.
Joint and several liability:
In a partnership, the partners are always personally and jointly liable to other parties, and this can never be contractually relinquished.
Personal liability means that the partners must cover the company's debts and any agreements entered into from their own assets. Joint liability means that each and every partner may be personally compelled to pay all the company's debts. The person who has paid may then claim against the other partners for their share of the debt.
A limited partnership (kommanditbolag) is a kind of partnership where there is at least one partner whose liability takes the form of capital invested in the business. Such people are called limited partners (kommanditdelägare). At least one partner, the so-called general partner (komplementär), always bears unlimited personal liability. Otherwise, the rules are the same as for a normal partnership.
An economic association is an option if there are at least three people who want to start a company together.
An economic association is intended to promote the economic interest of its members. This means that the members must gain some economic benefit from belonging to the association. The benefit may be a contract, a better price or reduced costs. There is nothing to stop the association from promoting other interests that are not purely economic, provided that economic interest takes precedence.
The scale of the investment that each member has to put in may vary from SEK 1 upwards. Both individuals and legal entities may be members.
A limited company is suitable where there are several owners or if the company potentially faces financial risks. The limited company is a legal entity in itself.
When you start a limited company you must have at least SEK 50 000 in share capital. This is equivalent to a quantity of shares held by the shareholders as proof that they own the company. The share capital may include cash or other assets of value to the business. These assets are called capital contributed in kind (apportegendom) and must be valued by an auditor.
Business plans and valuation
Whatever your business, you have everything to gain by planning your start-up and being well prepared. This is generally referred to as drawing up a business plan.
It describes how you intend to implement your business idea in a way that sets out clear goals for your company. Think through your business idea thoroughly before you start. Describe:
- the goods or services that you intend to sell;
- who is expected to buy the goods or services;
- the state of the market;
- your advantages and disadvantages compared to your competitors.
Contents of a business plan
A business plan should be easy to understand. It should contain facts and should be both serious and stimulating. A business plan may be more or less detailed depending on the type of activity. Some points that are always present are details of:
- the owners of the company;
- their experience and skills;
- the business idea;
- products or services, including pricing;
- the market and customers;
- marketing strategy;
- resource requirements;
- budget and liquidity and profit forecasts;
- schedule and work plan.
To succeed, a new business needs a sound commercial strategy and secure financing.
Some standard requirements to be completed when setting up a business are the same as when opening a branch.
Services Directive Contact points in Sweden
The Services Directive is EU-legislation which is aimed making it easier for the companies to provide services within the EU - both in their native country and abroad. The directive states regulations for the companies which want to start companies or provide services on a temporary basis within the EU/EEA (EU’s 27 member states and Iceland, Liechtenstein and Norway). According to the directive, the member states must do away with unnecessary bureaucracy, simplify the formalities for the companies and make public management more efficient.
In order to put the directive into practice, each member state should establish a common point of contact, a e-management portal which simplifies for the companies the management fo the administrative procedures on-line. In those points of contact there is comprehensive information about all administrative questions in connection with starting a service company or expanding a company’s activity in a certain country, among others the following:
- Which licences or permits do I need and which applications do I need to make in order to start a company (at home or abroad)?
- What do I need to do if I temporarily would like to offer services abroad?
- How do i apply for a licence? Whcih authority is responsible?
- Do I have to pay a fee for the licences? Which assigned time periods apply?
- Which legislation applies to my branch?
- What do I need to do if I, for example, would like to open a restaurant or a shop? Or if I would like to be a travel agent in another country without starting a company?
- Where can I get personal advice and further information?
Thanks to the points of information you do not need to contact different authorities individually! You can find all the relevant information and submit electronic applications to the responsible authorities at the common point of contact. You can manage all formalities electronically at the point of contact. You need to contact the point of contact in the country you would like to do business with.
All points of contact are included in the European network EUGO - through a central web portal you can easily reach all the points of contact in Europe. Of course you choose yourself if you would like to make use of them. You can also choose to contact the relevant authorities directly.
Registering a company
You can register as a sole trader, limited company, partnership or economic association via the online services on the business portal verksamt.se. In order to log in, you need an online ID. On verksamt.se you will also find information on types of companies and how to register.
When starting a business you must register for the corporation (F) tax (F-skatt) and VAT (Moms) for the company with the National Tax Board.
If staff are to be employed, the company must also be registered as an employer with the National Tax Agency. The corporate tax F card is proof that the company pays taxes and makes social security contributions.
You can find further information, links and various services on the business portal verksamt.se.