Company registration is the process of formalizing the status of a legal entity in accordance with the laws of a certain country. During this process, the company is officially recognized as a legal entity with its own legal capacity. To receive this status, it is necessary to provide certain documentation and fulfill the requirements established by the state authorities. Due to registration, the entity is able to conduct commercial activities, conclude contracts, participate in court proceedings and perform other legally significant actions.
Registering a company in the cryptocurrency industry is a multi-step process that requires careful planning and compliance. From defining the business model to entering the market, each step is important for the successful operation of the company.
What should you consider before registering a company?
1. Define the concept and business model:
The first step in setting up a crypto company is to define the concept and business model. You should determine which area of the crypto sphere you would like to work with, both in terms of your interest and practical implementation. Determine how your product or service will solve a specific problem and meet customer needs. For example, it could be creating a new asset exchange platform.
2. Market analysis:
This aspect includes: analyzing the competitors and identifying the unique advantages of your product or service.
- You should start by researching the main players in the market offering similar products or services. Analyze their strengths and weaknesses to determine your competitive advantage.
- Another important step is to look for possible strategic partners who can help you develop your business. These could be other cryptocurrency companies, financial institutions, or technical partners.
- You should also identify what makes your product or service unique and competitive. This could be innovative technology, a better user experience, or more attractive terms of use.
3. Develop a business plan:
This aspect includes a description of the product, target audience, marketing strategy, and financial projections.
- Outline who the main users of your product will be. They could be individual investors, large corporations, financial institutions, or developers;
- Outline and formulate your budget, you should start from the initial concept of the main activity of the future company to get a better understanding of the amount that will need to be invested for the initial period.
4. Choice of legal form:
It is very important to choose the appropriate legal form for your business. Below we will take a closer look at some of the legal forms of business entities:
This is the simplest form of business structure in which one person owns and operates a company. There is no legal distinction between the owner and the business entity in sole proprietorship. The owner has complete control over business decisions and keeps all profits, but is fully responsible for any debts and liabilities incurred by the entity. This type of business structure is simple and inexpensive to set up, and requires minimal formalities compared to other business entities.
But one of the significant disadvantages of a sole proprietorship is that the owner has unlimited personal liability, meaning that his or her personal assets are at risk in the event of debts or lawsuits. Furthermore, sole proprietorships can be difficult to raise capital or investors due to the owner’s limited financial resources.
- Limited Liability Company
This is a legal entity that exists separately from its owners, known as members. One of the key advantages of a limited liability company is the limited liability protection it provides to its members. Meaning that if the entity incurs debts or legal liabilities, the personal assets of the members are generally protected from creditors and business-related lawsuits. As for the disadvantages, these are the formalities required to operate, the possibility of disagreements between members, and the limited ability to raise capital compared to corporations.
It is a type of legal entity in which ownership is divided into shares. This ownership structure makes it possible to pool the capital of several shareholders. The profits earned by the firm are distributed among the shareholders in the form of dividends depending on the number of shares they own. Among the main advantages of a joint stock company is limited liability, which means that shareholders are not personally liable for the debts and obligations of the entity. This stimulates investment by spreading risk among shareholders and attracting capital from a wide range of investors.
It is a type of business structure in which two or more people, called partners, come together to conduct business for profit. Partnerships are a popular form of business organization for small businesses and professional practices like law, accounting, and medical firms.
There are different types of partnerships, including general partnerships, limited partnerships, and limited liability partnerships, each with its own characteristics and legal implications.
In general, partnerships offer benefits such as shared decision-making, management flexibility, and simplified tax reporting, making them in demand for businesses with multiple owners who want to collaborate and share resources. Partners should, however, be mindful of the potential risks associated with unlimited liability and the importance of a well-drafted partnership agreement.
Сompany registration process and key legal steps
Company registration is a key step in establishing a legal entity for doing business. The process involves the official registration of a company with the relevant government authorities, which ensures its legal recognition. There are a number of steps that need to be taken during the company registration process to ensure compliance with legal and regulatory requirements. These steps typically include:
- Choosing a company name:
This stage involves choosing a unique and legally acceptable name for your company. The name you choose must meet several criteria:
- Uniqueness: the name should not be too similar to names of other registered companies in the chosen jurisdiction. Check the relevant company registry to ensure the name is available and to avoid conflicts with existing businesses.
- Legal compliance: the name must comply with legal requirements that may prohibit the use of certain words or phrases.
- Relevance: the name should accurately reflect the nature of your business and be easily understood by your target audience
2. Determination the final structure and ownership of the business:
At this stage, decisions need to be made about the legal form of the company and its structure:
- Legal form: choose the appropriate form of ownership such as a limited liability company (LLC), a partnership, or a sole proprietorship based on business objectives, level of responsibility, and tax planning.
- Company structure: establish the composition of shareholders, their shares in the company, roles, and responsibilities. This may include the appointment of directors, managers, and other key officers.
- Internal documents: prepare constituent documents, such as memorandum of association, and company policies, which will govern the internal operations of the company.
3. Collection of the necessary documents from the client:
Having established the company structure and ownership, it is essential to collect all the documents required for registration in a particular jurisdiction (these may vary from country to country). This usually includes:
- Copies of the identity documents of the company founders
- Documents confirming the legal address of the company, such as a lease or title deed for the premises
- Bank statements or other documents confirming the financial solvency of the incorporators, if required by law
- Other documents may be required depending on the jurisdiction and the specifics of your business, such as licenses for certain activities or certificates of compliance
4. Preparation and filing of registration documents:
The next step is to prepare and file all the necessary documents for the official registration of the company:
- Completing forms: completing all the necessary forms for company registration, which may include the application form, memorandum, and articles of association.
- Checking for legal requirements: checking that the documents are completed correctly and comply with legal requirements.
- Submitting: submitting the documents to the relevant government agency or registry. In different jurisdictions, this may be the Ministry of Justice, the Chamber of Commerce, or another body.
5. Obtaining of the necessary licenses and permits:
Once the company is registered, depending on the type of activity, it may be necessary to obtain additional licenses and permits:
- Licenses: obtaining the licenses required to carry out a particular type of activity.
- Local permits: in some cases, it may be necessary to obtain local permits or approvals from local authorities.
- Certification: some businesses may need to have their products or services certified to meet quality and safety standards.
6. Tax compliance and reporting:
- Identifying tax liabilities: identifying and paying all taxes that the company is required to pay, including corporation tax, VAT, income tax (where employees are employed), social security contributions, and other local taxes.
- Regular reporting: submitting regular reports to the tax authorities, which may include quarterly and annual reports on income, expenses, tax payments, and other financial data.
An example of a step-by-step company registration in Austria:
Step 1. Initial setup
- Initiating a preliminary project assessment, assessing risks, choosing the type of company, preparing the necessary documents and obtaining the necessary permits, determining the time frame, budget and resources required to complete the process
- Preparation and filing of the package of documents
Step 2. Company registration
- Getting your company’s name and its activity approved by the Commercial Register
- Drafting statutory documents of your company (Memorandum and Articles of Association) followed by notarizing them
- Depositing the statutory capital in the local bank for the future company as a bank certificate verifying this status is required at incorporation
- Submitting the necessary documents to the Commercial Register
- Filing for tax registration
- Registering employees for social security
- Acquiring the corporate seal
- Filing for the necessary business permits and licenses, where applicable
For readers
If you are planning to set up a company in the crypto industry, but are afraid of the complicated registration algorithm, we are ready to offer you our assistance! Manimama is a law firm consisting of a team of highly skilled lawyers with expertise in business registration and regulatory compliance. We are committed to providing our clients with the knowledge and resources necessary to navigate the complexities of company formation and ensure legal compliance throughout their business path.
We can help you with the following:
- Consulting on all matters that relate to company registration, identifying the advantages and limitations of different jurisdictions, as well as professional analysis in order to select the best option
- Legal documentation and company registration
- Company secretarial services
- Preparation of apostilled documents
- Ongoing legal support
Our Contacts
If you want to become our client or partner, feel free to contact us at support@manimama.eu.
Or use our telegram @manimama_sales and we will respond to your inquiry.
We also invite you to visit our website: https://manimama.eu/uk/golovna/.
Manimama Legal & Growth Agency provides a gateway for the companies operating as the virtual asset wallet and exchange providers allowing to enter to the markets legally. We are ready to offer an appropriate support in obtaining a license with lower founding and operating costs. We offer KYC/AML launch, support in risk assessment, legal services, legal opinions, advice on general data protection provisions, contracts and all necessary legal and business tools to start business of virtual asset service provider.
The content of this article is intended to provide a general guide to the subject matter, not to be considered as a legal consultation.
