Rather than forming a company and setting up a subsidiary, a foreign company may choose to enter directly onto the Faroese market.
In most cases this requires that you register a branch office with the Company Advisory and Investment Centre, as well as registering with the Faroese Tax Authorities, where you are required to state the nature of the business and the name and nationality of the foreign company.
In principle, the foreign company is liable to file tax returns and to submit annual accounts according to the Consolidated Bookkeeping Act. The branch manager must furthermore be a resident in the Kingdom of Denmark.
Other business organisations include the General Partnership and the Limited Partnership, Commercial Foundations, and Sole traders. The partnerships and the Sole traders are governed by the Consolidated Act on Certain Commercial Undertakings, while commercial foundations are governed by the Act on Commercial Foundations.
After registering the company on the basis of the received application, the company receives a registration number from the Company Advisory and Investment Centre which subsequently makes contact with the Faroese Tax Authorities in order to register the company for taxation and to receive a Company Registration Number.