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Expanding Your Business into the European Market

With more than 480 million consumers and an ever-improving free flow of goods, the European Union (EU) is a market that's hard for small business owners to ignore.[1]

"If indeed you have a viable market in the U.S., you probably do have a viable market over in Europe," says Larry Harding, founder and president of High Street Partners Inc. a provider of international business software and services based in Boston.

Here are several key considerations when expanding an international business into the European market.

Business owners should contact the national or regional development agencies to learn about local regulations and requirements for working in the EU.

Learn More About Using Online FX

1. Use Valuable Online Tools and Resources

While trying to navigate opening a new business in Europe, business owners should consider using a trusted online foreign exchange service to handle dollar-to-euro conversions. An online FX service can offer relevant resources and helpful tools, such as a free online currency converter and 24/7 customer service. With low markups and high-level transparency, business owners will always know where their funds are at in the payment process.

2. Register with Development Agencies

Once an ideal region or country in Europe has been identified, business owners should contact the national or regional development agencies to learn about local regulations and requirements for working in the EU. For example, a Canadian business owner expanding into the U.K. would need to comply with local immigration rules and would likely need a visa or work permit to do business legally in the U.K. In this case, Harding recommends individuals contact the UK Trade & Investment (UKTI) organization for guidance on obtaining the appropriate permit, which is based on factors such as length of stay and planned activities.

The European Commission's Points of Single Contact (PSCs) website provides detailed information on exactly what licenses or permits are needed to do business in Europe. For example, a U.S. exporter who wants to expand into the U.K. could visit the site and see that she must register with the Companies House, the United Kingdom Registrar of Companies, an executive government agency under the department for Business, Innovation and Skills (BIS).

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3. Consider European Regulations and Guidelines

Once a foreign business is set up in a particular region, it generally can do business freely in the entire European market. However, there are various EU-wide regulations with which a business must comply.

For example, many products destined for Europe are required to have a CE marking, which indicates that a product - anything from a teddy bear to a cellphone - meets EU safety, health and environmental protection requirements. Also, if a company intends on selling pharmaceuticals or chemicals, it must register under and comply with the European Union REACH regulatory guidelines, which cover the Registration, Evaluation, Authorization and Restriction of Chemical substances.

Most countries also have ongoing requirements, such as filing an annual tax return, says Harding, noting that most European countries have a value-added tax rather than the American sales tax. Also, he says most countries will require some combination of an annual audit, quarterly or annual filings with regional authorities.

Prospective European entrepreneurs may be able to learn about their foreign tax obligations by visiting the European Commission's Your Europe business website, which offers a "practical guide for doing business in Europe."


[1] "EU Market," Europa.eu



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