Legal framework and regulation in the Nordics


Corporate forms in Finland

The various company forms in Finland are: proprietorship (toiminimi); partnership (avoin yhtiö); limited partnership (kommandiittiyhtiö); limited company (osakeyhtiö) and cooperative association (osuuskunta).


The simplest and most popular way to start in business is to operate as a private entrepreneur using a company name. Decision-making and responsibility in the company belong with the entrepreneur, and the company may employ workers as in other forms of business. For part-time entrepreneurship it is often beneficial to start as a proprietorship. Starting business in this way is speedy and uncomplicated.


A partnership is formed when two or more individuals agree to it by signing a partnership agreement. The partners have equal status in all the company’s operations and are personally responsible for company decisions, liabilities and debts.

Limited partnership

A limited partnership differs from an ordinary partnership in that in addition to one or more accountable partners there is at least one sleeping partner, i.e. a participant in the company who generally acts as an investor.

Limited company

Establishment of a limited company requires at least one individual or corporation, and its minimum share capital is 2,500 Euros. The share capital is divided into shares. A shareholder’s voting power, profit and liability depend on how many shares they own.

Cooperative association

A minimum of three persons can form a cooperative association, which is a company owned by its members. Each member has one vote in cooperative association meetings. The liability of the members for the cooperative association’s obligations (for example, debts) is limited to their investment of share capital.

  1. Some entity forms including the limited company and the cooperative society are independently liable to pay income tax as taxpayers. Their receipts of income is taxed as income attributable to the entity itself.
  2. Corporate income tax rate is 20 %.
  3. If a limited liability company distributes dividend to its shareholders, the shareholder-beneficiaries will be taxed as provided by specific rules.
  4. If the corporate entity is an association or a foundation promoting for the public good, any receipts of business income or income derived from real property will be taxable. If an association or foundation is not deemed as an entity promoting for the public good, it is liable to pay 20 % tax on all income.