Publication date: 05.06.2024
How to register an LLC: From an idea to a successful business
In the modern business environment of Ukraine, a limited liability company (LLC) remains one of the most popular forms of business organization. Why? The answer is simple: the optimal balance between the protection of personal property of the founders and flexibility in business management. In this article, we will consider the entire path - from the idea to the registration of an LLC, and we will also talk about how to adapt your business to changes.
Business registration is not just a legal procedure, it is the first step to realizing your dream. According to the State Statistics Service, in 2022, despite difficult conditions, more than 50,000 new LLCs were registered. This shows the inexhaustible energy of Ukrainian entrepreneurs.
Olena Petrenko, the owner of a chain of bakeries, recalls: "When I decided to open my business, I hesitated between a sole proprietorship and an LLC. But after consulting with a lawyer, I chose LLC registration. Yes, it is a little more complicated, but it gives more opportunities for expansion."
So, where to start with company registration?
1. Define a name. It must be unique. Check it in the Unified State Register.
2. Select types of activity according to KVED (Classifier of types of economic activity). You can choose up to 20 species, but one must be the main one.
3. Define the authorized capital of the LLC. The minimum is 1 hryvnia, but it is better to set a realistic amount.
4. Select the address of the legal entity. It can be a rented premises or the home address of one of the founders.
5. Appoint the director of the company. It can be one of the founders or a hired person.
With all these data, you can submit documents online through the Diya portal or in person to the state registrar. By law, LLC registration takes up to 3 business days and is free.
Another common procedure is to change the address of the LLC. In the early years of business, many companies start from a home office and then move into a commercial space. Changing the address of a legal entity requires amendments to the statute, but it is not difficult - it can be done in one visit to the state registrar.
Changing the director of an LLC is another frequent operation. Sometimes the founder, who was the director at the start, realizes that it is better for him to focus on the strategy, and to transfer the operational management to a professional manager. The change of the director of the company takes place by decision of the meeting of participants and is also registered by the state registrar.
Maryna Savchenko, the owner of a network of kindergartens, says: "In the third year of operation, we decided to expand through a franchise. For this, we had to increase the authorized capital - the bank demanded. I was worried that changing the authorized capital of an LLC would be difficult, but it turned out not to be."
Indeed, changing the authorized capital of a legal entity is a procedure that many entrepreneurs consider complicated, but in fact it is quite simple. A decision of the meeting of participants, amendments to the charter and submission of documents to the registrar are required. This can be useful not only for obtaining a loan, but also for attracting investors.
Speaking about business development, one cannot ignore the issue of trademark registration. Although TM registration is not part of LLC registration, it is a critical step in protecting your brand. As your company grows in popularity, so does the risk of copying.
Oleg Lysenko, the owner of an IT startup, recalls: "We didn't pay attention to trademark registration at the beginning. A year later, we discovered that someone was using a very similar name. We had to change the brand - it cost us almost a year of work. Now I advise everyone: register a TM immediately after the registration of the LLC."
Unfortunately, not all business stories have a happy ending. Sometimes entrepreneurs are faced with the need to close a business. The reasons can be different: from changing market conditions to personal circumstances. In such cases, it is important to carry out the procedure correctly.
Closing an LLC or, in legal terms, liquidating an LLC is a complex process that can take up to a year. It includes:
1. Decision on liquidation
2. Appointment of the liquidation commission
3. Notification of creditors
4. Carrying out inventory
5. Compilation of liquidation balance sheet
6. Removal from registers
Summarizing, we can say that the path of business - from the registration of an LLC to possible closure - is a road full of challenges and opportunities. At every stage, whether it is a change of company director, or trademark registration, or even liquidation of a business, it is important to act competently from a legal point of view.
Andriy Kovalenko, whom we quoted earlier, summarizes: "In business, I spend money on three things: on the product, on marketing and on lawyers. And if you can save money on the first two, then on lawyers - never. Because one mistake in the documents can cost of all business."
Wise words. In the world of business, every document, every change of statute, every registration is a brick in the foundation of your business. And it is better that professionals build this foundation from the very beginning.
