A subsidiary in Georgia is a new legal entity that has a foreign company as its main shareholder. Unlike the branch, this type of business gives the foreign company the possibility to detach itself from the liabilities of its subsidiary. The foreign parent company will thus establish its presence in Georgia by incorporating a new company in the country.
A new subsidiary in Georgia
In order to open a subsidiary in Georgia
, a foreign entrepreneur must open a limited liability company
. There are a few steps to complete when opening this type of company, starting with choosing the right and available business name (followed by the abbreviation LLC), opening a bank account and registering the limited liability company.
This type of company
has at least one member and the ownership can be shared by one or two members. In case of a subsidiary, the foreign parent company is the main shareholder. The liability of the shareholders is limited by the amount of their contributions to the share capital.
The most important documents that need to be provided when opening a subsidiary in Georgia are the documents belonging to the parent company:
- articles of association,
- identification details,
- information about the shareholders.
Our company formation agents in Georgia can help you submit and draw up all of these documents.
The advantages of a subsidiary in Georgia
The decision to open a branch or a subsidiary in Georgia can depend on a number of factors and on the business plans the foreign company has in Georgia. Although the branch is easier to set up and it becomes operational in a shorter amount of time, the subsidiary can be seen as a more risk-free business structure because the assets owned by the parent company will not be at risk if bankruptcy occurs.
is also a preferred business structure when dealing with customer perception. Some customers and/or partners will show more confidence when working with a subsidiary company because the business is a Georgian legal entity, committed to the Georgian market and the Georgian company law