A shelf company, also known as a ready-made company, is a company that has no activity and was incorporated for resale and future use. It is a totally empty entity, which has no liabilities or assets.
It was registered to be put on the “shelf” waiting for someone to take it off. In practice, it means that a professional service provider incorporates a company and holds it for a future customer, who will need a company with clear records. BPiON provides shelf companies for their clients in Poland, Hungary, and Romania.
There are more reasons why shelf company can be a convenient choice for starting business:
+ Acquiring a company and managing the transfer of all rights usually takes much less time and needs less documentation than registering a new one. Sometimes, legal involvement is not necessary.
+ All administration work connected with SPA (share purchase agreement) could be done fully remotely.
+ Since all of the Company’s details are established contracts can be drafted, including all the company details and business can be started immediately. It could be very useful if you want to hire an employee as quick as possible.
+ In some countries, the process of obtaining a VAT number can take a couple of months and requires extensive documentation process. This time can be saved by acquiring a shelf company, which usually already has one.
+ Shelf companies are often used for real estate asset transactions like purchasing a building.
+ Showing to the third party that your company has existed for a long time may increase credibility and may attract more investors and customers.
+ In some cases, conditions for participating in tenders or getting loans require at least a couple of years of existence for a company.
+ In very limited cases –dependent on legal requirements of a specific country – shelf companies may have an existing bank account. Changing an existing account’s owner and director takes much less time and effort than opening a new one and going through the full compliance process.
It is important to be sure, or at least obtain enough confidence, that the company was not used in any business activity in the past, because it can carry tax or legal consequences. For quick verification, accounting records can be checked before signing the contract, but for more extensive investigation, obtaining an official tax statement, certificate of good standing or involving a third-party legal advisor can be an appropriate decision. In general, it is more convenient to acquire a shelf company from a trusted provider, who have long traceable history of business and would not put its reputation at risk by providing questionable services. Usually, accounting and corporate service providers offer ready-made companies for sale, who can later take care of domiciliation, corporate secretarial and accounting services for the new company owners.
BPiON offers shelf companies in Poland, Hungary and Romania which always meet all the legal and compliance requirements, have up-to-date accounting and do not have any records of outstanding tax liabilities or business history. Our team of experts ensures, that our customers get the service in a timely and appropriate manner, meeting high professional level of service. We are ready to serve our clients in the long term and would be happy to provide accounting, tax compliance, corporate secretarial and payroll services to the newly acquired companies.
Frequently Asked Questions
+ Do shelf companies cost more than the registration of a new company?
Usually, shelf companies registered in the same year would cost the same price, however those that were registered earlier would cost more due to their benefits and costs incurred in the past. The older the company, the more it costs, as there are administrative and accounting duties related to shelf entities.
+ Can someone see that it was a shelf company in the beginning?
No, A shelf company is not a legal or official denomination of this type of company. It is not stated anywhere, it is just a general expression for a not used ready-made company. During an extensive review of accounting records or company history, it can be seen, that the company did not have business activity in the beginning and had different ownership.
+ Can I use the company for myself, but stay unidentified by the authorities?
The accounting and corporate service providers have their legal obligation to identify and register new customers, including directors, shareholders and beneficial owners and to provide all required information to authorities. There is no possibility of becoming our customer without providing appropriate identification documents and signing relevant documents.
+ Can I change the Articles of Association (AoA) of the shelf company after acquiring it?
Generally, any data of the company can be changed, including the company name, directors, shareholders, ultimate beneficial owner, business address, activities, way of representation etc. Usually all changes are made during SPA – no additional meeting are required.
+ Can I change Charts of Accounts?
Yes, it is possible. If you chose BPiON as an accounting provider, this is standard activity during an implementation process. Many times our Clients use group chart of accounts.
+ Do I have to be present during the SPA (share purchase agreement)?
No personal presence is needed. Our attorneys will prepare a proxy to act on behalf of the share purchaser. Usually we just need notarized confirmation from the shareholder’s country and sometimes an apostille.
+ Can I just have just foreign directors?
Yes, but they should have an eIDAS proof e-signature that accepts XML format files. This is important because there are some activities which have to be signed and submitted by Board Members, like the submission of Ultimate Beneficial Owner structure to the Polish UBO registry. Of course, BPiON can take care of almost all local compliance. If you need local e-signature, BPiON can arrange it for you without the need to travel.
+ Do foreign Board Members need to obtain visa, work permit, residence permit?
Sometimes yes. Depends on your legal and personal situation. BPiON can assist during this process.
+ Is a shelf company the same entity as a company registered from scratch?
Yes, a shelf company is a complete entity, no different from a company registered in a traditional way.
+ Can I start my business right away when buying a shelf company?
The most important advantage of a shelf company is the comfort of starting business activities immediately after confirming the signatures of the share sale/purchase agreement before the notary public. From now on, the company can conclude contracts and trade.
+ How long do the formalities related to the purchase of a shelf company take?
Usually no more than 1-2 days. After identifying the data of new shareholders and new board members, we prepare all the necessary documents to be able to represent the client in front of the notary (those usually has to be signed in front of notary or apostille). During the meeting at the notary’s office, our attorney signs all documents required for an effective entry and registration of changes in the National Court Register.
+ Since when can the new Management Board operate in the course of business?
Since the appointment of the board