Companies Created By Estonian E-Residents Have Now Accumulated £1.5bn Turnover

Companies Created By Estonian E-Residents Have Now Accumulated £1.5bn Turnover
Companies Created By Estonian E-Residents Have Now Accumulated £1.5bn Turnover

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By citiesabc resources - Aug 27, 2020

E-Residents of Estonia, who have established 13,000 Estonian companies worldwide since the launch of the e-Residency programme in December 2014, have now accumulated a total turnover exceeding £1.5 billion. The growth has been fuelled by a recent substantial increase in Estonian companies established by e-Residents to gain access to the EU market. e-Residency has also reported a significant increase of new e-residents since the start of the COVID-19 outbreak.

According to Ott Vatter, Managing Director of e-Residency, turnover of e-Residents’ companies is increasing rapidly. He said: “In 2016, the total turnover of e-Residents’ companies based in Estonia totalled £65 million. Last year, it increased more than sevenfold, totalling £480 million.” Rapid growth, he says, is based on the recent increase in Estonian companies established by e-Residents. E-Residents have launched 8,300 new businesses in Estonia over the last two years, compared to a total Estonian population of 1.3 million.

“In 2019, e-Residents established a sixth of all new companies created in Estonia. This means that on average, e-residents created 11 companies every day between 2018 and 2019. However, over the first quarter of 2020 that involved COVID-19 outbreak in European Union countries, including Estonia, e-residents created nearly 50% more companies than during the same period in 2019. This demonstrates that location independent company administration is even more relevant in a global crisis situation,” says Vatter.

Total turnover growth of e-Residents’ Estonian companies has also driven the growth of the same businesses’ average tax revenue. In 2019, the cumulative average tax revenue created by e-Residents’ Estonian companies increased by 32%. “A large number of e-Resident companies have taken their products and services to the global market, many of which have benefitted from becoming EU companies thanks to e-Residency, having also generated customer demand on a global level. Also, most businesses launched by e-Residents play an active part in building a knowledge-based society, and are active in fields that create remarkable added additional value to the economy,” explained Vatter.

Many e-Residents who have established companies in Estonia within the last six months are still working hard on product and service development. “Entrepreneurs all around the world see the added value that e-Residency brings, as we’re providing them with the opportunity to use Estonian digital e-services and run their company remotely. With the COVID-19 pandemic still ongoing, many countries around the world are still fully or partly in lockdown, which means entrepreneurs and SMEs are desperately looking for alternative ways to keep their companies running. E-Residency will always be there to support those companies who are anxious about the future."

The E-Residency programme was launched by Estonian Government in 2014 with the aim to offer non-residents across the world secure and transparent access to Estonian pioneering digital services. Owners of e-Resident digital ID-cards can digitally sign documents, and access portals and information systems that accept Estonian ID-cards that are eIDAS compliant. E-Residency itself does not give Estonian citizenship, tax-residency, residency or right to enter Estonia or the European Union.

Everyone can apply for this transnational government-issued digital identity and benefit from the e-Residency platform, which is built on inclusion, legitimacy and transparency.  E-Residency allows access to Estonia’s public e-services and a variety of e-services provided by international service providers, all part of Estonia’s X-Road, which links all public services together and enables each service to work in harmony. All outgoing data is digitally signed and encrypted, and all incoming data is authenticated and logged, meaning that e-Residents’ and other users of the X-Road’s data is completely secure.This provides the freedom to easily start and run a global EU company fully online from anywhere in the world.

E-residents can: open a company within a day and run the company remotely, apply for a business banking account and credit card, conduct e-banking, use international payment service providers, declare taxes, and sign documents digitally. E-Residency does not provide citizenship, tax residency, physical residency or the right to travel to Estonia or EU.

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