The Finnish Limited Liability Companies Act Is Set for Its Biggest Reform in Years

Summary: The reform of the Finnish Companies Act (Government Bill HE 126/2026 vp, entering into force on 1 July 2027) makes incorporating a growth company lighter, allows zero-price options and round-linked pricing formulas, writes the right of first refusal and interim dividends into the Act, removes the financial assistance prohibition for private companies, and opens a light route out of the Trade Register. In exchange, responsibility shifts from formal requirements to the management's documented judgment. In this article I walk through the key changes and how they are meant to be interpreted according to the reasoning of the Government Bill. Changes concerning public companies and special audits receive less attention here. Tax legislation is likewise expected to change, so it is worth following separately.

PART 1 – INTRODUCTION

The Finnish Parliament is considering the most extensive reform of the Companies Act in years (HE 126/2026 vp). The Bill is 411 pages long and enters into force on 1 July 2027. Most of the changes are technical, but among them are a dozen or so that show up directly in the everyday life of a growth company: incorporation, option programs, control of the ownership base, and winding down operations.

The reform has one red thread, and it is worth understanding right away: the law is letting go of some paperwork and shifting responsibility to reasoning. Certificates, auditor statements and formal requirements are partially removed, and in their place come new aspects of the management's duty of care and documented judgment. The Government Bill says it itself, outright: more liability claims against management are to be expected. Perhaps a carrot for insurance companies, too? Freedom grows and the bill is paid in the minutes. The legislator means this literally: board minutes and decisions made without holding a meeting must, going forward, also be dated by law.

In this article, I highlight what I consider the main points of the proposed law for the everyday life of growth companies and startups.

PART 2 – INCORPORATION AND CAPITALIZATION GET LIGHTER

Subscription price to unrestricted equity without a separate clause.

The presumption flips: going forward, the subscription price is booked by default to the reserve for invested unrestricted equity (the Finnish SVOP reserve). This is how everyone has operated for years — and now the law too. One boilerplate clause disappears from every share issue resolution.

The subscription price can in future be paid to a payment institution's account.

Until now, the options have in practice been limited to banks. Going forward, an account with a licensed payment institution also qualifies. For a founder this helps in situations where opening a bank account for a new company takes time. For companies building payment services, this may be an entirely new market for covering the banks' slow service in account opening.

Small in-kind contributions without an auditor's statement.

In-kind contributions of up to EUR 8,000 are exempted from the mandatory auditor's statement in private companies. At incorporation the limit applies to shares paid in connection with the founding; in share issues it is calculated per financial year, which prevents the chaining of small contributions. The status quo has been absurd: the statement has cost more than the contribution has been worth. The relief has a flip side. If no statement is obtained, the burden of proving the asset's value lies with the subscriber, and any shortfall is paid in cash. For equipment, the relief is real. If the contribution is intellectual property or anything else open to interpretation, a voluntary statement remains cheap insurance.

The auditor's certificate disappears from the registration filing.

Verifying a cash payment in a private company no longer requires an auditor's certificate. Anyone who has fixed DIY Trade Register filings knows this certificate is the attachment most often missing — and the one that turns into a correction request from the PRH (the Finnish register authority) and weeks of delay. Going forward, a receipt or bank statement showing the payment on the company's account is enough.

Key takeaway:

The reliefs do not remove responsibility — they relocate it. Without a statement, the burden of proving the contribution's value lies with the subscriber. Document your valuations even though the law no longer forces you to.

PART 3 – OWNERSHIP BASE, OPTIONS AND AUTHORIZATIONS

The right of first refusal enters the Act, but does it really change shareholders' agreement practice?

Articles of association may in future include a right of first refusal clause. Note the wording: may, not must. A right of first refusal can still be agreed solely in the shareholders' agreement, and nothing forces it into the articles. So what is the added value? A shareholders' agreement binds only its parties. The articles of association bind everyone — that is, also option holders exercising their options, heirs, and those outside the agreement. Expect the same setup as with redemption clauses: many companies will run the clause in duplicate. A stripped-down, universally binding version in the articles. The details in the shareholders' agreement. These two layers live separate lives, and that is worth being aware of: the statutory text says outright that a transfer in violation of the right of first refusal clause is invalid, while an SHA breach triggers only contractual remedies between the parties. The procedural deadlines run as default rules (the board's notice to the rights holders 1 month, the purchase demand 2 months, payment 1 month), and note the direction: the deadlines may be shortened in the articles but not extended. If the company itself exercises the right of first refusal, the purchase must be made with distributable funds — a penniless company cannot be the buyer. For the board this is process liability: failing to pass on the notice may lead to liability for damages, but it does not extend the purchase window. A right of first refusal clause is not a line in the articles — it is a process the board has to run.

And in the same package: acquisition and redemption rights for others than the company (Chapter 15, Section 10).

The articles of association may in future provide that the right to acquire or redeem the company's shares belongs also to a shareholder or another party — that is, not only to the company itself. In practice this means leaver redemptions get an articles-level tool: when a key person leaves, the redeeming party can act directly under the articles — for example, the majority owner. Together with the right of first refusal, this moves a significant slice of the exit mechanics of shareholders' agreements over to the articles of association — binding on all shareholders.

The share issue date gets a definition.

A small change, a big relief. Nearly every DIY shareholder register is missing the share issue date — often because nobody has known which date belongs there.

A new authorization no longer cancels the old one.

The current presumption has produced a classic mistake: a share issue authorization granted for a financing round accidentally wipes out the option program's authorization, and the error surfaces only when the options are about to be exercised. The presumption flips: a new authorization does not cancel the old one unless otherwise decided. In exchange, keeping the books on authorizations is in future the company's own responsibility. An authorization register belongs in the board's annual clock.

Zero-price options become lawful.

Before: the Act required consideration for the shares, so options were priced at EUR 0.01 and cent payments were collected and confirmed in writing — or the parties committed by contract to future bonus issues, whose corporate-law enforceability was, in the Bill's own words, uncertain. After: shares may be subscribed under an option entirely without consideration. The zero price has a price in documentation: where nothing is paid for the right or for the shares obtained under it, the grant must have an especially weighty financial reason in view of the interests of the company and all its shareholders, and the reasoning must always be recorded in the resolution. Employee retention will presumably qualify, but it must be written out. What about tax? The honest answer: under current tax law the practical significance is small. An employee option benefit is taxed at subscription on the fair value, so the difference between EUR 0.01 and zero is immaterial for tax purposes. The Bill itself notes that tax consequences are assessed separately. The significance is in the signal: company law now recognizes zero-price instruments as a normal part of incentive schemes, and the mismatch with tax legislation becomes all the more visible. The next move is on the tax side.

The subscription price may be tied to a formula.

An option resolution may in future state a calculation basis instead of a fixed price, and the reasoning of the Government Bill expressly mentions a value determined by reference to a future financing round. Round-linked mechanisms thus get direct statutory backing. The limit is clear: the basis must be clear and precisely defined in the resolution. "The board will decide the valuation later" will not do, now or in the future. One thing does not flex: the maximum number of shares to be issued must still be stated as a fixed figure. The price may float, the quantity may not. In practice the cap is sized past the formula's scenario range, and dilution is modeled at the extremes before the resolution. And if you are thinking about convertible loan notes: the amendment to the capital loan chapter is purely technical, but convertibles benefit from everything above — and get a statutory definition on top, under which an option with a set-off condition is a convertible loan.

Key takeaway:

All the new flexibility — zero prices, formulas, longer authorizations — demands more precise resolution documentation in return.

PART 4 – DISTRIBUTIONS, LIGHT EXIT AND HOW TO PREPARE

Interim dividends are written into the Act — no need to wait for the financial year to end.

The new Chapter 13, Section 3 says it outright: distributions are based on the most recently adopted financial statements, which may also be prepared for a period other than the financial year. According to the reasoning, this clarifies a legal position considered unclear — interim dividends have already been paid in practice without problems, and both the Finnish Accounting Board and the Supreme Administrative Court have accepted them, but scattered doubts in legal literature have kept the uncertainty alive. Now the debate ends.

What can a distribution be based on in practice? Three options: the latest adopted financial statements for a financial year (the base case); interim financial statements adopted by the general meeting for any period — for example January through June, which also makes the current financial year's profit distributable; or, in liquidation and deregistration situations, no financial statements at all: in the words of the reasoning, the company may then distribute all assets remaining after payment of its debts, "whether they appear in the financial statements or not."

Two guardrails always remain. If the company is subject to a statutory audit, the interim financial statements must also be audited. And the solvency test, together with the duty to take into account material adverse changes after the balance sheet date, applies to an interim dividend just as it does to an ordinary one — interim statements are a calculation basis, not a shortcut.

For a growth company the practical significance shows in exit situations: when a business or an asset is sold mid-year, the gain can be repatriated to the owners through interim financial statements without waiting for the financial year to end. The same applies to transactions where the buyer requires the cash to be swept out before closing.

The financial assistance prohibition is removed for private companies (Chapter 13, Section 10).

Briefly, because this is big in principle: the prohibition on giving loans, assets or security to finance the acquisition of the company's own shares will remain applicable only to public companies. In private companies, structures open up that have so far been engineered around at great expense — management buyouts, a founder's partial exit, arrangements where the target's cash flow forms part of the deal financing. This is not an open mandate: according to the reasoning, such arrangements will in future be assessed under the general principles — equal treatment, the company's interest, the management's duty of care — and a sound business rationale is required, much as with related-party loans today. The formal prohibition is replaced by a duty to justify. Sound familiar? The same pattern as everywhere else in this reform.

A company can be removed from the register without liquidation proceedings.

The Bill admits the status quo openly: heavy and expensive winding-up proceedings have left companies dangling in the register for years. In future, a debt-free private company can be removed from the register by application when the shareholders are unanimous. No public summons, no liquidator.

The relief is built on the management's diligence. Debts do not lapse. Management must investigate them before the decision — the Bill's reasoning mentions querying tax debts and checking pension contributions — and realization costs and tax consequences also count as known debts. The board gives an assurance, and those who received assets are liable for unpaid debts up to the amount they received.

The threshold to start a company drops. The threshold to close one down cleanly drops. For the ecosystem, that is healthy at both ends.

Closing words

Less paperwork, more reasoning is perhaps the whole reform in one sentence. Formal requirements give way to burdens of proof, recording duties and management liability. For a growth company this is a fairly good trade: bureaucracy lightens where it was most pointless, and in exchange the minutes must contain what an attachment used to handle. Companies that update their documentation ahead of time gain a head start from the reform. The rest fix things afterwards — and as usual, almost everything is fixable, as long as it is tackled in time.

DM Lauri Nieminen or Legaunsel if you want to talk more.

legaunsel(at)legaunsel.fi

NOTE: This article is based on Government Bill HE 126/2026 vp. The Bill is before Parliament and the details may still change. No legal advice. No reliance.