Corporate & Business Law · European Union
Set Up a Foreign Subsidiary in Europe With the Right Structure
A subsidiary gives your parent company a separate local presence, but it comes with its own formation, governance, transfer-pricing and reporting duties. We match you, free of charge, with a vetted lawyer who establishes foreign subsidiaries in your target country every day.
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Who this is for
Expanding through a subsidiary means running a fully separate local company
A foreign subsidiary is a company incorporated in one country but owned or controlled by a parent company in another — a common way to enter a new market, hire local staff, hold local assets or ring-fence liability away from the parent. Unlike a branch, a subsidiary is a distinct legal entity with its own board, share capital, accounts and tax residence. Setting one up properly means incorporating under local company law, appointing directors who meet local rules, drafting or adapting articles, and putting in place the intercompany agreements, transfer-pricing documentation and reporting that tax authorities scrutinise. Because a subsidiary is separately liable and taxed, the structure you choose — and the agreements between parent and subsidiary — matter a great deal. A lawyer who regularly establishes foreign subsidiaries ensures the entity is compliant from the outset and that its relationship with the parent is documented correctly.
Why subsidiaries go wrong
A subsidiary is a separate company in law,
and it is held to separate standards.
Local governance, thin-capitalisation, transfer pricing and reporting rules all apply — and the parent’s assumptions rarely match local reality.
Local governance mismatches
A subsidiary needs its own directors, board procedures and records that comply with local law. Appointing parent staff who do not meet local residency or eligibility rules can invalidate decisions.
Transfer pricing & intercompany rules
Transactions between parent and subsidiary — loans, services, royalties — must be at arm’s length and documented. Getting this wrong attracts tax adjustments and penalties in most countries.
Standalone reporting & filing
The subsidiary must keep its own accounts, file its own returns and meet local audit thresholds, independently of the parent. Missed filings create compliance risk and personal exposure for directors.
What you get
A lawyer who establishes foreign subsidiaries properly
We only match you with lawyers who set up and support foreign subsidiaries in your target country, so your expansion is compliant from day one.
Structure & incorporation
Your lawyer advises whether a subsidiary is the right vehicle, then incorporates it correctly — articles, directors, capital and registration — under local company law.
Intercompany documentation
Loans, service and royalty agreements between parent and subsidiary are drafted strictly at arm’s length, with transfer-pricing documentation prepared so the arrangement fully withstands scrutiny.
Governance & director duties
Board composition, decision-making and record-keeping are set up carefully to comply with all relevant local corporate-governance rules, protecting both the subsidiary and all its directors.
Tax & compliance set-up
Corporate tax, VAT, payroll and any sector licences are registered correctly, and ongoing filing obligations are mapped so the subsidiary stays compliant as it grows.
Coverage
Foreign subsidiary lawyers across Europe
Subsidiary rules are set by national company and tax law, so the right lawyer is one who practises in the country where the subsidiary will be based. We match cases across the following countries and beyond:
Frequently asked
Foreign subsidiaries — common questions
What is the difference between a subsidiary and a branch?
A subsidiary is a separate legal entity incorporated in the host country, with its own directors, capital and tax residence, owned by the parent. A branch is not a separate company — it is an extension of the parent and the parent remains directly liable for its obligations.
Why choose a subsidiary instead of a branch?
A subsidiary can ring-fence the parent’s liability, is often seen as more credible by local customers and regulators, and may be preferred for tax or regulatory reasons. The best choice depends on your goals, activity and tax position — a lawyer will compare the options for your case.
Who can be a director of my foreign subsidiary?
Director requirements vary by country — some allow foreign directors, others require at least one local or resident director. There may also be minimum numbers of directors and eligibility checks. A lawyer will confirm what your subsidiary needs.
What is transfer pricing and why does it matter?
Transfer pricing concerns the prices charged between related companies, such as a parent and its subsidiary. Most countries require these to be at arm’s length and properly documented, and failures can lead to tax adjustments and penalties — a lawyer will help you set this up correctly.
Does the subsidiary need its own accounts and filings?
Yes. A subsidiary is a separate legal entity and must keep its own accounting records, file its own tax returns and, in most countries, prepare annual accounts, with audit obligations above certain thresholds. These are independent of the parent’s reporting.
How long does it take to set up a foreign subsidiary?
Timelines vary by country and typically range from a few weeks to a few months, depending on registration, notarisation, banking and tax registration. A lawyer familiar with the local process can sequence these steps to keep the launch on track.
Free case review
Expand into Europe through a properly structured subsidiary
Tell us where you want to establish your subsidiary and we’ll connect you with a lawyer who sets up foreign subsidiaries there daily — free of charge, with no obligation to hire.