Liechtenstein is a tiny, Alpine country located in Western Europe, bordering Switzerland and Austria to the west and east respectively. It has an area of approximately 160 square kilometers and a population of around 38,000 people. The official language is German and the country is a constitutional monarchy headed by a prince.
Liechtenstein has a strong economy and is one of the wealthiest countries in the world. It is also one of the smallest countries in the world by population and area. Liechtenstein is not a member of the European Union but it uses the Swiss franc as its currency.
Types of business structures in Liechtenstein
The Liechtenstein business ecosystem supports various forms of corporate structures. The table below reflects the types of permissible business structures in the country along with the required paid-up capital.
| S# | Type of company | Local Name | Min. required paid-up capital |
| 1. | Sole Proprietorship | Einzelunternehmen | No minimum capital required |
| 2. | Partnership | Personengesellschaft | No minimum capital required |
| 3. | Limited Liability Company – LLC | Gesellschaft mit beschränkter Haftung (GmbH) | €30,000 |
| 4. | Public Limited Company – PLC | Aktiengesellschaft (AG) | €50,000 |
Sole proprietorship
This is a simple business structure in which one person owns and operates the business. It is the most common form of business in Liechtenstein and is easy to set up and maintain.
Partnership
A partnership requires at least two persons to initiate the business. The rights and obligations of partners in the business are determined by their share in investment or any extraordinary skills they may possess. Partners in a business are responsible for all debts and obligations in their personal capacity.
Limited liability company (LLC)
An LLC is a type of company in which the shareholders are only liable for the company’s debts to the extent of their share capital. This means that the personal assets of the shareholders are protected in case the company goes bankrupt.
Corporation (Aktiengesellschaft) (AG)
An AG is a public limited company, which is similar to a corporation in other countries. It is a separate legal entity from its shareholders and has limited liability. AGs are required to have a minimum share capital of €50,000.
Each type of business structure has its own advantages and disadvantages, and it’s important to choose the one that best suits your business needs. It’s also important to note that these are the minimum requirements, and some businesses may require more capital depending on their operations and goals. Additionally, capital requirements may change over time, so it’s important to check for the most updated information with relevant authorities.
Costs involved in registering a company in Liechtenstein
The costs involved in registering various companies in Liechtenstein vary depending on the type of business structure and the services required. Below are some estimates of the costs involved in registering various companies in Liechtenstein:
Sole proprietorship
The costs of registering a sole proprietorship in Liechtenstein are relatively low and may include fees for registering the business with the trade register, obtaining a business license, and any other administrative costs. These costs can range from a few hundred to a few thousand Swiss francs.
Partnership
The costs of registering a partnership in Liechtenstein are similar to those of a sole proprietorship, but may be slightly higher due to the need to register multiple partners.
Limited liability company (LLC)
The costs of registering an LLC in Liechtenstein can vary widely depending on the services required and the complexity of the company. The costs may include fees for registering the company with the trade register, legal fees for drafting the articles of association, and any other administrative costs. These costs can range from a few thousand to tens of thousands of Swiss francs.
Aktiengesellschaft (AG)
The costs of registering an AG in Liechtenstein can be higher than for an LLC, due to the additional requirements for public limited companies such as a minimum share capital of €50,000 and other regulatory requirements. These costs can range from tens of thousands to hundreds of thousands of Swiss francs.
Cost of doing business on Liechtenstein
The cost of doing business in anywhere depends on the type of business and the industry. However, Liechtenstein has a stable and well catered economy known for its pro-business environment, which can help to keep costs relatively low. Some of the factors that can affect the cost of doing business in Liechtenstein include:
Taxes
Liechtenstein has a relatively low tax rate, with a corporate income tax rate of 12.5%. Additionally, there is no value-added tax (VAT) in Liechtenstein, which can help to keep costs low for businesses.
Labor costs
Liechtenstein has a high standard of living and the labor costs can be relatively high, especially for skilled workers. However, the country has a well-educated workforce and a high level of productivity, which can help to offset the higher labor costs.
Real estate and office space
Liechtenstein is a small country and real estate can be relatively expensive. However, there are many opportunities for businesses to find cost-effective office space in the country.
Energy costs
Energy costs in Liechtenstein can be relatively high due to the country’s mountainous terrain, which can make it more difficult and costly to generate electricity.
Government fees and regulations
Liechtenstein has a relatively simple and efficient regulatory environment, which can help to keep costs low for businesses. However, there may be some government fees and regulations that businesses will need to comply with.
Benefits of doing business in Liechtenstein
Liechtenstein offers several benefits for businesses, including:
Low taxes
Liechtenstein has a low corporate tax rate of 12.5% and a favorable tax environment for holding and domiciliary companies.
Political stability
Liechtenstein is a stable, politically neutral country with a strong tradition of democracy and the rule of law.
Strategic location
Liechtenstein is located in the heart of Europe and has easy access to major markets such as Switzerland, Germany, and Austria.
Skilled workforce
Liechtenstein has a highly educated and skilled workforce, making it an attractive location for businesses in industries such as finance, banking, and manufacturing.
Business-friendly environment
The government of Liechtenstein is committed to creating a business-friendly environment and offers a range of services to support the growth and development of companies.
Legal system
Liechtenstein has a modern legal system that is based on Swiss law and offers a high degree of legal certainty for businesses.
Privacy protection
Liechtenstein’s strict privacy laws and regulations can provide added protection for companies’ sensitive information. This allows companies to indulge in cutting-edge innovation without fearing corporate theft and plagiarism.
