As a result, a Danish company is an ideal platform for Nordic and European expansion from which to set up branches in other countries. Moreover, establishing a company in Denmark is simpler, faster and more cost-efficient than establishing a branch. It only takes a few hours to register a company ready for business whereas it usually takes several weeks, and is more costly, to register a branch.
There are Three Ways to Register a Company in Denmark
Online Registration
A new company can be incorporated and ready for business within only a few hours by using the online electronic registration system provided by the Danish Business Authority. No requirements for local shareholders or local resident management apply.
Paper Registration
A traditional paper registration of the company will usually take two to three weeks.
Acquiring a shelf company
An “off the shelf” company is a company which has already been founded and registered but has no previous activities or operations. Such companies can be acquired and up and running from one day to the next.
As registering a company online is fast and very cost-efficient, this is the most commonly used procedure in Denmark.
Limited Liability Company
The most commonly used business entity in Denmark is a limited liability company, as it is very quick and easy to form. Two main types of limited liability company prevail:
1. A/S (public limited liability company).
2. ApS (private limited liability company).
The share capital is not regarded as a cost and is not blocked, but may instead be used as part of the operating capital. Share capital above the minimum capital may be subscribed, but later paid in according to specific rules. Besides the minimum share capital requirements, the differences between the A/S and the ApS primarily relate to the composition of management and other formalities.
A Danish ApS is an Anpartsselskab which is actually a private limited liability company in Denmark. This type of structure is usually chosen for small and medium sized companies that are set up by foreign investors and it is mandatory to register it with the Danish Commerce and Companies Agency.
In order to set up a limited liability company in Denmark or an ApS, it is necessary to provide at least 80,000 DKK. The initial capital must be deposited in the Danish currency and it must be paid in full prior to company registration in Denmark. Members of a Danish ApS do not own shares.
At least one founder is required for setting up an ApS in Denmark. There can also be more shareholders when a Danish ApS is established and they can be either individuals or legal entities.
It is mandatory to have a management structure with a board of directors of at least three members if the limited liability company in Denmark has a capital over 300,000 DKK or if there are more than 35 employees. If these conditions are not met, the company can have at least one director who must be appointed by the shareholders and must be registered with the Registrar of Companies. It is however compulsory to have a registered or a state authorized accountant in order for him to submit annual financial statements regarding the company and to deal with the appropriate bookkeeping of the documents in a Danish ApS.