Foreign companies can open a subsidiary in Sweden to expand their business activities. Our team specializes in company formation in Sweden and can assist you with the subsidiary’s incorporation.
| Quick Facts | |
|---|---|
| Applicable legislation | The Swedish Corporate Law |
Best Used For | Small, medium, or large companies |
Minimum share capital | SEK 25,000 (approx. EUR 2,150) for the private limited company |
| Time frame for the incorporation (approx.) | 9 days |
| Documents to be filed by the parent company | The subsidiary's Articles of Association and Memorandum, along with other documents |
| Management | The foreign company can appoint a foreign manager for its Swedish subsidiary; no residency requirements apply. |
| Legal representative required | No, however, one can be appointed. |
| Local bank account | Yes |
| Independence from the parent company | The subsidiary is a separate legal entity from the foreign company. |
| Liability of the parent company | Generally not liable for its Swedish subsidiary |
| Corporate tax rate | 20.6% |
| Annual accounts filing requirements | Annual reports are filed within seven months from the end of the financial year. |
| Possibility of hiring local staff | The subsidiary can hire employees just like any locally-registered company. |
| Travel requirements for incorporating branch/subsidiary | Our company formation agents in Sweden can act on your behalf for part of the subsidiary incorporation steps. Please reach out to us for details. |
| Double tax treaty access | Yes |
Table of Contents
What is a subsidiary in Sweden?
The subsidiary is essentially a locally incorporated company, most commonly in the form of a private limited liability company. The foreign legal entity that decides to open a company in Sweden will structure its subsidiary in such a way that it will own the majority of its capital (in most cases, at least 50%).
What are the main characteristics of a Swedish subsidiary?
Our team lists the following general traits below:
- The subsidiary is a separate legal entity from its parent company based abroad;
- The foreign company has a controlling interest in its subsidiary (as mentioned above);
- The parent company’s liability is limited (to the amount owned in the Swedish legal entity);
- The subsidiary must meet the current minimum capital requirements applicable to all those who open a company in Sweden;
- The Swedish subsidiary is governed by local tax and reporting requirements, meaning that it will work with an accountant in Sweden and it will meet the Swedish reporting and regulatory guidelines;
- The subsidiary can engage in the same activities as the parent company or others, if applicable. Special permits and licenses, such as those issued by theSwedish Financial Supervisory Authority, may be required.
What legal entities can be used to establish a subsidiary in Sweden?
The subsidiary can be incorporated as a private or a public company. The following differences apply:
- The private company cannot sell its shares to the public;
- The minimum capital for the private limited company is SEK25,000 and SEK500,000 for the public limited company;
- The private company has at least 1 board member, while the public one has minimum 3 members;
- The public company needs to appoint a managing director and an auditor, while these steps are optional for the private company.
New limited companies in Sweden must also register the information about their beneficial owners with the Companies Registration Office.
What documents must I provide when I establish a subsidiary in Sweden?
The following set of documents is required when opening a Swedish subsidiary as a private limited company (the AB company) in 2026:
- The Articles of Incorporation, also known as the Founding Act of the company. These must be signed by the founders (in this case, a legal entity shareholder);
- The bank certificate indicating that the minimum share capital was deposited for the purpose of company formation in Sweden (SEK 25,000 for the private limited company);
- The filled-in company registration form;
- Information on the appointed managing director for the Swedish subsidiary. Identification details are also required for other persons of interest in the company.
We invite you to watch a video about this business form:
What are the mandatory conditions when opening a subsidiary in Sweden?
The Swedish company incorporation requirements apply to locally registered legal entities. Because the subsidiary is essentially a Swedish company, it must:
- Have a registered office in Sweden;
- Have a managing director who is a citizen of an EEA member country.
How much does it cost to establish a subsidiary in Sweden?
When working with our team, we charge an advance payment of SEK27,200 (including our hourly rate for the estimated dedicated hours plus the government registration fee). Additional charges and/or adjustments are made once the application for registration is accepted and approved.
How fast can I open a subsidiary in Sweden?
If all the company incorporation documents are in order, the business registration certificate can be issued in approximately 5 working days. In some cases, the process can be longer, estimated at 15 working days.
If you want to open a company in Sweden, in the form of a subsidiary, in 2026, contact us for more information as well as ongoing assistance during the incorporation process.