Legal differences – LTD or branch office?

Legal differences – LTD or branch office in Slovenia?

You already have your business, and are you considering expanding your business to Slovenia and other EU countries? Often we get a question in our company Data, which are actually legal differences between LTD (d.o.o.) and branch office. The answer to this question is a significant factor in the decision-making process, for which type of company you decide.

You do not need starting capital for branch office

The first difference, which is often crucial in deciding, is that you do not need starting capital for branch office. In order to open LTD in Slovenia you need a capital of min 7.500 eur.

 

Secondly, it is important to know that branch office is not an independent legal entity, but it is a part of the parent foreign company. The branch office does not have a natural person as owner, but is owned by a parent foreign company. On behalf of a foreign company, when registering a branch office, the director of a foreign company has to be present.

LTD is an independent legal entity, and the owner can be a natural person or a legal entity. Those legal differences are significant factor in the decision-making process, since you need to register a legal entity for certain activities.

To register branch office you do not need to be present in Slovenia

You can also establish a branch office based on power of attorney, which means that it is not necessary for you to be present for registration.

Our experts can register branch office on your behalf!

In case of LTD this is not possible, because you also need to open a bank account for your company. For branch office you do not have to open account with a bank in Slovenia.
It is also important to know that in a branch office you must register those business activities that are also registered in the parent company. In case of LTD company you can register any business activity with which the company will deal in Slovenia and the EU.

Who is responsible for the business obligations?

For business obligations from the operations of a branch, the parent foreign company responds with its assets. For LTD business obligations, the company is responsible with its assets.

Do you want to register a company in Slovenia? Contact us!

Data offers to future entrepreneurs legal, tax, entrepreneurial and accounting advice on the conditions for starting a business in Slovenia. If you need more information send us a request by e-mail data@data.si. You can also call us on 00386 1 6006 270 or 00386 40 530 718 (Viber, WhatsApp). Realize you business idea with the help of Data’s experts!

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Read a short guide on how to open a company in Slovenia: Business in Europe – step by step guide for foreigners.

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