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Open a Foundation in Sweden

Open a Foundation in Sweden

Do you wish to open a foundation in Sweden? You will need to set up this business form, determine its purpose, as well as register it with the Swedish authorities. A foundation is a non-profit organization, set up with the purpose of providing funding and support in most cases.

Our company formation experts in Sweden can also assist investors who are interested in setting up a foundation. Starting this type of entity is subject to several conditions, as well as regulations, and with the help of our team those interested will fully understand the compliance requirements.

The non-profit association in Sweden

Entrepreneurs or philanthropists can open a foundation in Sweden for non-profit reasons, however, this type of association can also be used to operate a business. As a general rule, the foundation (the non-profit association) may not be used to increase the economic interests of the members through operating commercial activities.

The foundation typically promotes the rights or interests of its members or is set up in order to provide the funding needed to support a specific purpose. It can also be set up for the sole purpose of being used by specific natural persons.

Employers may also open a foundation in Sweden for purposes related to the pension of their employees (please see below for more information about the types of foundations). A foundation will need to comply with the following requirements:

  • – it is set up by 1 or more founders, however, when used as a non-profit the condition is to have 3 founders; it has one or more authorized signatories (representatives);
  • – in most cases, it is registered with the County Administration Board (not applicable, however, in case of foundations that have their assets used only for the purposes of certain natural persons);
  • – once the individual(s) decide to open a foundation in Sweden, the registration is to be made no later than 6 months after its establishment;
  • – the foundation has a written charter (which can also be in the form of a will), describing how the assets are to be managed; this charter needs to be signed by the founder(s).

Our team can give you complete information about the requirements for foundations, as well as the process needed to register them with the authorities (when this is required). Alternatively, we can also assist investors who wish to launch a startup in Sweden.

The general foundation

The general foundation is commonly used by those who wish to open a Swedish foundation. It has the following characteristics:

  • – one or more founders provide property or assets for independent administration, on a permanent basis and for a designated purpose;
  • – it has a charter, and it can be created to operate a business in its name;
  • – it has a natural person assigned as manager; it also has a chairperson;
  • – it reports to the County Administrative Board (it is supervised by it), and it is registered with the Board.

Other types of foundations in Sweden

The other available types of foundations include:

  1. the fundraising foundation: used to collect money which will then be used to support a certain purpose which needs to be continuous (not a temporary one); the founder does not provide his own money for the establishment of the foundation and the collected money is not used for other purposes;
  2. the foundation used to run a business: if stipulated in the foundation charter and only for general foundations, fundraising or collective agreement foundations; before the operation of the business can begin, the foundation needs to provide details on the business it will operate;
  3. the pension foundation: used by the employer to safeguard the money destined for the pensions of his employees; it is incorporated according to the Pension Obligations Vesting Act;
  4. the personnel foundation: used by the employer to set aside funds for the welfare of the employees or their surviving relatives; it is not used to provide pensions, salaries, or benefits.

Specific and general requirements apply for registering and managing each of the types described above. If you want to open a foundation in Sweden, our team can help you. Contact us for more information on the general foundation, as well as its mandatory registration.

If the foundation will be used to operate a business, our team can also assist you during the set up of a Swedish LLC.