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Finland is a business-friendly economy with a wealth of opportunities awaiting international firms, but gaining access to the market can be a troublesome task without the help of local experts.
Organisations looking for quick access to growing markets of Northern Europe will find all they need and more in Finland, which is why the country has long been favoured among international firms over its regional counterparts. There is a first class business environment and establishing a corporate entity is easy and fast. What’s more, the country’s functional infrastructure, modern logistics and communications networks make the day-to-day running of the business seamless, efficient and invariably profitable.
The industrial economy is home to a thriving private sector and a business environment that is highly conducive to foreign direct investment (FDI). The regulatory environment is business-friendly and red tape is minimal, allowing the free market to reign in a transparent and open economy.
But despite the obvious appeals of the Finnish economy to international investors, navigating the tax and regulatory environment can be difficult without prior knowledge of the business landscape.
Starting a Business
Although there are only three procedures, it can take an average of two weeks to start a business in Finland. Companies must pay in shared capital to a bank and pay the registration fee before submitting a single start-up notification form to the NBPR (National Board of Patents and Registration) and the Tax Administration and filing at a private insurer for pension insurance, accident insurance, and medical insurance of employees.
Dealing with Construction Permits
There are 16 procedures to navigate when dealing with construction permits, taking an average of 66 days. Several permits must be obtained before work can begin and inspections are to be carried out by official departments, such as the Public Rescue Service and the Real Estate Office.
Getting Electricity
Electrical connections are carried out by the regional electricity firm which will handle applications, conduct external work and install the meter. Businesses must organise the material and connection works for the interior.
Registering Property
When registering property the seller and buyer must notarise the deed of sale in the presence of an attesting notary. A transfer tax must also be paid and a land title obtained from the District Council.
Getting Credit
There is no public registry coverage in Finland and the private bureau coverage is relatively weak. This can make getting credit for the company a little more difficult.
Protecting Investors
The World Bank and International Finance Corporation (IFC) rank Finland in 70th place in the world for investor protection. This is down four places on 2012.
Paying Taxes
There are eight corporate tax payments to be made each year which take an average of 93 business hours to complete. Pension insurance contributions are by far the most rigorous task, and for international firms, completing such documents can prove to be rather complicated.
Trading Across Borders
The cost of trading across borders is very cheap in Finland, although it can take quite some time to complete. With four documents to fill out when exporting and five when importing it can take over a week to move goods both ways.
Enforcing Contracts and Resolving Insolvency
Compared to the OECD average, enforcing contracts is quite a streamlined process in Finland, taking 375 days to complete on average. Resolving Insolvency is similarly streamlined, taking less than a year to move through the judicial system.
Culture
The Finns are egalitarians and as such do not appreciate shows of ostentation, so over dressing for business occasions and flamboyance are not advised. Physical contact such as back slapping or putting hands on shoulders is not generally done, and ensure that you are punctual and well prepared for business meetings.
TMF Group
We have the local knowledge to help you navigate these minefields. Whether you want to set up in Finland or just want to streamline your Finnish operations,
talk to us.