Estonian Company Shareholders Change
without a notary
Short overview
Since 01.08.2020, shareholder changes in the Business Register can be done without a notary.
It involves becoming a shareholder, ending shareholdership, or changing the shareholders’ structure and the share value.
It often takes just a week or less to file shareholders’ changes in the Business Register, and the associated costs are low.
Even if the registrar has issued a ruling that shareholders' changes must be filed via notary, it is not 100% correct. What the ruling really tells is that with this kind of paperwork, you can’t change shareholders. However, they do not mention that by changing the shareholders’ decision, you can change shareholders without notary assistance.
For Estonian residents and e-residents, the process is straightforward. An alternative is to sign with an international Qualified Electronic Signature (QES), which is available for more than 80 countries' document holders. This takes only a few minutes.
3. Simplified Change of Shareholdings
When to use
Suitable and intended for situations where a private limited company needs to constantly change shareholders and a minimum share capital of 10,000 euros is not a problem. This is particularly well-suited for STARTUP-type companies where shareholding sizes may change or the company's own shares need to be redistributed under certain conditions.
General information
For simplified change of shareholdings, it is first necessary to increase the private limited company's share capital to 10,000 euros and add a clause to the articles of association stating that "the company has waived the disposal transaction requirement for alienation and pledging of shares." This subsequently allows shareholdings to be changed in simple written form without a notary, and enables the management board to register changes regarding modified shareholders.
Required documents for submission to the commercial register
Decision by existing shareholders regarding share capital increase and amendment of articles of association. During the share capital increase, it is also possible to bring in new shareholders if necessary.
Application to the Business Register.
New articles of association containing the clause that "the company has waived the disposal transaction requirement for alienation and pledging of shares."
Notice from a credit institution or payment institution regarding share capital payment is only required if the share capital contribution exceeds 50,000 euros. For smaller amounts, confirmation from the management board that the share capital has been paid is sufficient.
Signature requirements
Shareholders' decisions are adopted and digitally signed by existing shareholders; signatures of new shareholders on the decision are not required. The shareholders' decision may also be signed in simple written form and sent to the Business Register by mail, but this makes the process more complicated.
The application to the Business Register must be signed by at least one registered member of the management board. If the management board members or some of them are authorized to represent the private limited company jointly, then all of their signatures are required on the application.
Time duration
An experienced specialist needs a few hours to prepare the necessary documents. The commercial register makes its decision within 5 working days.
Registration of shareholder changes
Once the corresponding amendment to the articles of association has been made, shareholdings can simply be changed with a simple written agreement and the management board subsequently makes the shareholder changes in the Business Register. The Business Register typically makes the shareholder change in the register within one working day.
The law requires an alienation agreement between shareholders regarding the transfer of shareholdings, which must be concluded in a form that allows written reproduction. The agreement does not need to be submitted to the Business Register but serves as the basis for the management board to register the corresponding change.
Possible costs
If you order document preparation from a specialist, the associated costs are typically 250-350 EUR + VAT. The exact cost depends on the actual scope of work.