Why Your EU Business Partner Might Be Asking You to Set Up an EU Company

EU Trade

As cross-border trade becomes increasingly complex, many EU-based companies are now requiring their non-EU partners to set up a presence within the European Union. This trend affects businesses across industries from large grocery and textiles retail companies such as ALDI, to technology and software companies.

At Nathan Trust, we’ve helped numerous non-EU clients navigate this process after being asked by their EU partners to incorporate an entity in the EU to continue or enhance trade relationships. Here's why it's happening, what the benefits are, and how you can set up an EU-based company with Ireland being one of the top choices.

Why Are Your EU Clients Requiring an EU Presence?

There are several key reasons your EU business partner may request that you incorporate within the European Union:

Regulatory Compliance

Many EU companies are subject to strict compliance obligations under EU law, including VAT, product standards, and financial transparency. Working with a business registered in the EU simplifies legal and regulatory requirements.

Reduced Bureaucracy

Having a local presence allows EU companies to streamline operations and avoid the complexities of trading with a non-EU entity,  such as additional paperwork, customs declarations, or import/export restrictions.

Improved Market Access

Operating through an EU-based company gives you access to the entire EU Single Market, offering free movement of goods, services, capital, and people across 27 member states.

Legal and Financial Benefits

An EU entity may qualify for funding programs, local grants, or favourable tax regimes depending on the jurisdiction. It can also simplify banking, contracts, and invoicing for EU-based clients.

Why Ireland Is the Ideal Location for Your EU Entity

If you’re considering setting up an EU company, Ireland stands out for several reasons:

• Low Corporate Tax: One of the lowest standard corporation tax rates in the EU at 12.5%.
  
  
• English-Speaking: Ireland is now the only English-speaking country in the EU.
  
  
• Business-Friendly: Ranked highly for ease of doing business and regulatory transparency.
  
  
• Tech Hub: Home to global giants like Google, Apple, Meta, Intel, and Microsoft.
  
  
• Skilled Workforce: A young, well-educated talent pool ready to support your growth.

Setting Up an EU Company: Step-by-Step

Click here for a complete company setup guide

1. Choose the Right EU Jurisdiction

When selecting where to register your entity, consider:

• Language and legal system
  
  
• Taxation policy
  
  
• Administrative efficiency
  
  
• Sector-specific support or grants

Ireland ticks all these boxes for many international businesses.

2. Select a Suitable Structure

Common structures include:

• Subsidiary (most popular in Ireland) – A limited liability company (LTD) fully owned by your existing business.
  
  
• Branch Office – An extension of your existing company with no separate legal identity.
  
  

3. Register Your Business

You'll need to file with the Companies Registration Office (CRO) or the relevant authority in your chosen EU state. This includes:

• Articles of association
  
  
• Details of directors and shareholders
  
  
• Registered office address
  
  

4. Handle Legal, Tax, and Administrative Requirements

• Open an EU bank account
  
  
• Appoint local company officers (if required)
  
  
• Set up tax registration, accounting, and payroll systems

Key Considerations for Non-EU Businesses

Before or after setting up, be mindful of the following:

VAT Registration

If you’re supplying goods or services within the EU, VAT registration may be required in your chosen country.


Data Protection Compliance

Ensure you comply with GDPR when collecting, storing, or transferring personal data.


Labour Laws

Hiring staff? You'll need to follow local employment legislation from contracts to payroll and benefits.


Intellectual Property

Protect your IP in the EU by registering trademarks or patents, especially if you're in tech, creative, or product-driven sectors.

Turning an Obligation into an Opportunity

While being asked to establish an EU entity might seem like a hurdle, it can actually open doors to new markets, increased efficiency, and deeper client relationships. With the right guidance and jurisdiction — like Ireland — the process can be straightforward and strategically valuable.

Need help setting up your Irish or EU company?

Get in touch with Nathan Trust — we’ll help you navigate the legal, financial, and administrative steps so you can focus on growing your business.