Law change to help companies removed from Trade Register

Parliament is likely to debate the legal amendment before the end of the year.

The Patent and Registration Office (PRH) announced in September that it was temporarily halting the removal of companies from the Trade Register. The removal of companies had been criticized, as even functioning companies had been struck off.

Some companies have been removed from the Trade Register because of unfiled financial statements. We have previously reported on the case of limousine entrepreneur Lauri Kovanen from Helsinki.

Now, the Ministry of Economic Affairs and Employment is preparing amendments to the legislation governing the Trade Register. Janne Makkula, a Vice President at Suomen Yrittäjät, the Finnish SME association, says halting the removal of companies at this stage will not help companies who have already lost their business IDs.

“If a business ID has already been deleted, the process can’t be stopped. That’s precisely why this legal amendment is needed: so deleted business IDs can be restored, based on the legal amendment.”

The PRH confirms that the removal procedure in it itself does not mean that the company will be restored to the Trade Register.

The legal amendments regarding the removal procedure will concern both financial statements and beneficial owner notifications.

Law would affect these companies

Makkula is grateful to the PRH for listening to SY’s message about the faults in the removal procedure.

“We’ve established a good dialogue in this matter. I’m glad they’ve stopped removing companies and that the Bill is going to the consultation phase as quickly as possible. That’s what’s most essential now.”

Makkula advises business owners who have lost their business IDs to be patient.

“Now they just have to try and conduct their affairs somehow until the PRH is able to restore business IDs to the Trade Register,” he says.

Labour Minister Arto Satonen previously commented on the matter via a Ministry press release. He said that the starting premise for the legislative amendment is to give companies that were removed from the Trade Register because of human or inadvertent error the opportunity to apply to the PRH for re-registration.

The intention is to apply the amendment to businesses that have been removed from the register since the start of 2023.

To Parliament before year end

As it stands, the PRH has not restored businesses which have lost their business IDs to the Register if they have submitted the requested information after the deadline. The PRH has not changed its position, even if the delayed information was caused by inadvertent error, such as an accountant’s carelessness.

Previously, the PRH restored businesses to the Trade Register after a company had lost its business ID following the removal procedure.

“The current Act doesn’t provide for this. The PRH has changed its practice, which has surprised many business owners. Efforts have been made to spread the word, but perhaps the authorities will learn something from this process.”

At present, it appears the Ministry of Employment and the Economy will bring the legislative amendment to the consultation phase in early October. Makkula predicts the amendment will be placed before Parliament before the end of this year.

“The legislative process takes its own time, even though they’re trying to do it as fast as possible. A worse option would be if the process weren’t under way at all.”

Makkula says that businesses should continue to remember their statutory obligations.

“By law, a business must file financial statements and information about its beneficial owners. Not even the amended Act will save a company if it fails to meet its obligations yet again.”

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