Global entity management: providing a firm foundation for successful cross-border expansion in uncertain times
Establishing and operating entities across borders can be a heavy undertaking, with companies exposed to frequent rule changes, regional nuances and increasingly complex procedures. Such factors create uncertainty and risk for the ambitious businesses that have chosen to operate globally.
With governments tightening oversight around entity registration, UBO disclosures and economic substance requirements, companies must adopt a more agile and centralised approach to entity management.
Today’s global economy is characterised by complexity.
The ongoing uncertainty around tariffs is the most recent example of flaws in the multinational business model that firms need to respond to, and the expectation is that globalisation 3.0 will see companies establish more diversified supply chains to reduce concentration risk.
This diversification creates a cost, but one that is preferable over barriers to doing business.
In 2025, the subsequent surge in cross-border investment, shifting regulatory environments and a renewed global focus on compliance have made global entity management (GEM) both more complicated and more critical than ever. As more multinationals expand into new markets, the ability to establish, structure and manage legal entities in a compliant, scalable manner has become a key driver of long-term success.
Confident cross-border expansion starts with the right setup.
Why entity setup matters
Companies entering new jurisdictions often lack knowledge of that market and local expertise. This creates a number of pain points, such as how to navigate local laws, regulatory developments and tax requirements.
Once a company has decided which jurisdiction to expand into, there is another important decision to make concerning the entity type and structure. Each market has a range of options to choose from, including limited liability companies (LLCs), branches and representative offices, and many markets have their own variations of these structures. In Japan, for example, organisations can choose a kabushiki kaisha (joint-stock corporation) or a godo kaisha, which is a type of LLC, among other options.
Each option has different legal and compliance needs, and some structures will be more suitable and easier to implement for a specific business than others. Working with a partner with local knowledge and expertise helps a company to understand the options on offer and select the most appropriate one.
Setting up entities correctly from the start allows companies to adhere to local regulations and reduce the risk of costly penalties or legal issues. It also helps to avoid the need for a cumbersome restructuring in the future.
Turning compliance into a competitive advantage
But entity setup is more than simply a box to be ticked.
Smarter entity structuring can increase speed to market (and therefore cashflow) and provide a robust framework for operational readiness, cost control and long-term scalability.
In addition, a well-managed, centralised entity structure drives global business governance, enhancing transparency for all stakeholders while also building a sense of trust across different locations.
And having a clearer understanding of the operational structure of each entity allows a company’s leadership to make more informed strategic decisions.
Linking legal entity management with localisation
A company’s entity structure directly impacts its eligibility for special economic zones and the associated tax incentives offered by jurisdictions around the world.
As well as the tax landscape, legal entity decisions should be considered in coordination with local employment laws and labour requirements. Companies should consider how their chosen structure can help them attract and employ local talent, as well as the ease of getting a work visa should they need to bring in foreign employees.
Different structures also have different governance implications.
For example, each type specifies how many directors are needed, and how many must be local residents. As well as meeting economic substance criteria, this helps deal with local language obligations, which can otherwise be a major challenge for companies operating in multiple jurisdictions, causing delays and increasing costs due to translation and local certification requirements.
This is another element to factor in when considering entity management. Ultimately, access to local experts helps streamline business and ensure the entity is operationally ready, whether that is to sell goods and services or increase headcount.
Planning for expansion risks – before they bite
Local language requirements are just one challenge facing businesses expanding across borders.
Frequent legislative changes also lead to greater uncertainty and risk, making it difficult for companies to plan long-term strategies and ensure compliance with evolving standards, such as the raft of ESG rules now being embedded into markets around the world.
Another growing trend is UBO filings, which are being increasingly implemented in jurisdictions such as Brazil, China’s Mainland, Costa Rica and – most recently – Saudi Arabia, where most companies must disclose their UBOs to the Ministry of Commerce as of April 2025.
The combination of frequent adjustments and the need to navigate complex bureaucratic procedures adds layers of complexity, increasing operational costs and impacting overall business efficiency. Companies should both expect and prepare for greater complexity within entity management, particularly when, according to TMF Group’s Global Business Complexity Index (GBCI), only 9% of jurisdictions expect rules and regulations to become simpler in the coming years.
Businesses need to remain agile and ensure their approach to entity management is fit for purpose.
Using technology to simplify GEM
Proactive, technology-enabled entity management can help companies stay compliant, reduce costs and build a more reliable foundation for sustainable global growth.
With some organisations now operating across 50 or 60 jurisdictions, solutions like TMF KRAIOS provide an accessible, transparent overview of compliance calendars for different markets, entity status and upcoming obligations.
The new generation of tools is bypassing paper-based inefficiencies to provide expanding companies with a centralised, clearer line of sight so they can deal with many deadlines across multiple markets.
This also helps solve issues related to turnover. If the person in charge of entity management leaves a company, having the right technology in place — rather than relying on a number of disparate spreadsheets — provides a single source of truth, so their successor can log in 24/7 to instantly see the status of every legal entity.
Make seamless entity management part of your growth plan with TMF Group
We understand the challenges associated with multiple corporate structures, the importance of complying with local requirements and the increasing demand for governance and transparency. Our global entity management services remove the administrative burden and support you throughout your entities’ entire lifecycle.
At TMF Group, we turn complexity into opportunity, making business expansion simple and seamless.
Download our GBCI report to find out more.
