CASE A: The miners that found Finland
A Canadian mining company involved with zinc, copper, gold and nickel mining was interested in exploring potential resources in Finland and Sweden for their expansion. Preliminary studies of the mining company indicated that both countries were well endowed with interesting minerals and Scandicorp was requested to assist in the set up and structuring of a Nordic based subsidiary for exploration. Based on the specific client requirements and business plan Scandicorp’s suggestion it would be optimal to establish a subsidiary company in Finland, and furthermore that Scandicorp would provide a Registered Office Address and Directors to the subsidiary (so that the minimum requirements of EEA residence would be met) as well as providing the accounting work and local registration and payroll for the field engineers. Scandicorp did not only provide standard corporate services but also introduced the client to local exploration consultants and relevant government bodies whereby they availed of government grants and incentives. Exploration work in Sweden and Finland is still going on and the findings look positive.
CASE B: The venture capitalists’ Swedish holding company
A Group of corporate venture capitalists from a number of EU countries together with a Hong Kong based loan investor did some research on where to establish a joint holding company for the acquisition of some promising European start-up companies. Based on tax advice received from an international law firm specialising in tax advice, they decided that the holding company should be based in Sweden. Principally, due to the attractive Swedish holding company regime and the fact that Sweden has no withholding taxes on interest paid abroad, and furthermore the lack of thin capitalization rules was very important as the Hong Kong based investment would be in the form of a loan to the holding company. Scandicorp was asked to provide an estimate of the fees based on setting up a Swedish holding company with local Directors, management and financial administration as well as detailed monthly reporting. Scandicorp together with the clients’ international tax advisors and local Swedish tax experts presented a holding company structure based on both equity participation and debt. It was then decided to go ahead with the formation of the Swedish holding company with subsequent funding arrangements so that the acquisitions of the underlying start-up subsidiaries could take place without any delays. Whether the investments will be a success or not will depend on the performance of the subsidiaries, but one thing is for sure the Swedish holding company is about as tax-efficient as it can get from the investors’ point of view.
CASE C: The Swiss Clean-Tech innovation that became Norwegian
A Swiss inventor developed and patented a solution for the maritime industry that would considerably reduce environmentally harmful emissions of ship engines. He was, however, of the opinion that in the long run, it would be beneficial from a marketing perspective if his invention would appear to derive from a country with a strong global brand, a long maritime tradition and with a large modern merchant fleet. Following his initial meeting with Scandicorp professionals, he was introduced to specialist intellectual property advisors who suggested that he established a Norwegian company to hold a master-license of his Swiss technology, and that his Norwegian company would enter into a partnership with some Norwegian companies active in the Maritime Clean-Tech sector to promote his technology. Scandicorp was asked to help with the setting-up and administration of his Norwegian company and managed to introduce him to potential collaborative partners in Norway. Ultimately, Scandicorp managed to find the right local partners to promote his technology and it now appears as if the client’s successful start within the Norwegian maritime sector will lead to a global expansion from this base.
CASE D: The two towns that had to be moved
A Finnish building and construction company that had never previously did business abroad, faced difficulties in growing their business within the domestic market and decided to look for projects further afield. Their research revealed that there was a huge demand for housing projects in the Northern Swedish mining towns of Gällivare and Kiruna, since the two cities literally had to be relocated due to expansion of the mines. The company was very experienced in building houses in Northern and near Arctic conditions and thought that Sweden’s Gällivare and Kiruna would be ideal locations for expansion abroad, and well within their established expertise. The company was convinced that there would be sufficient work for at least the next 20 years, therefore they asked Scandicorp to register a Swedish subsidiary company with a prestigious address in central Stockholm, and further to provide all necessary accounting, payroll services and local representative services for the company. Furthermore, the client was particularly pleased that Scandicorp could prepare all management accounting reports in Finnish language for the parent company. The Swedish subsidiary immediately won some promising contracts in both Gällivare and Kiruna and the two towns are still welcoming more foreign businesses and entrepreneurs to fulfil their demand in construction work and infrastructure.