Panlegisgroup

Once upon the time, forming a company was a tedious and daunting experience. Woke up one morning with a great idea? Well all you had to do was call up your lawyer or your auditor (or find one if your didn't happen to have friends in that line of business), book an appointment, have a meeting, and then perhaps another meeting, and then they would prepare the documents, and you would come down to their office and sign the documents and - wait for it, not really there yet - send the documents in to the registrar, wait a week or more for a certificate of incorporation, and whoosh you were in business. Of course there was always a chance you might have forgotten what your idea was about by the time your company was up and running.

These days things are changing. Internet has made many forms electronic, and company formation agents has become common the US and in most EU jurisdictions.

Company formation agents, as the name implies, are experts in incorporating and registering companies. Thanks to the growth in the number of such specialized services, and the increasing standardization in company formation, the cost of forming companies in Europe has dropped dramatically over the last decade.

And internet and company formation agents has also made cross-border incorporations easy. Many jurisdictions still require a high share capital or have a company law that is tedious and bureaucratic. But today formation agents offers you the possibility of forming a company in another jurisdiction - with lower share capital requirements. Within the EU, you can run your company in any country, regardless of where you have formed it.

The Scandinavian company formation agent Panlegis, for example, has come up with an ingenious scheme that allows you to register a UK Ltd company (where there are no minimum capital requirements) and use it through a branch in a country like Sweden or Norway where there are high share capital requirements.

A good formation agent will be able to register your company within hours. In some countries papers cannot be sent electronically to the registrar, which obviously delays the process. Panlegis is online with Companies House in the UK - so there the process is almost immediate.

In most countries your formation papers will consist of two separate documents: the memorandum of association and the articles of association. The Memorandum is a document where the initial shareholders agree to be "formed into a company" (they agree to participate as shareholders), and the articles are the by-laws that regulate how your company will be run. A good formation agent will be able to advice you on important issues to be discussed before drafting these. Panlegis will usually ask you to think through issues such as preemption rights and voting rights.

When you receive back from the registrar or your formation agent, review them closely to make sure all the details are correct. If your agent has done the whole formation process your will usually be ready to start doing business. If your agent has provided you with documents to be signed and sent, you may have to wait for a formal company number and a Certificate of Incorporation to be returned to you.