While the reformulated Empresa Online 2.0 (Online Company 2.0) is an online Government platform that has been lauded for its swift process and innovative features that streamlines the incorporation of companies in Portugal and Madeira Island, certain aspects invite concern. The speed at which a company can now be created – in just 10 minutes – is remarkable. However, the implication of such a swift process raises questions about the quality, depth, and diligence involved.
The Rush to Incorporation
The option of creating a company in just ten minutes stands in stark contrast to traditional entrepreneurship, which often involves careful planning, market research, financial projections, and more. The Empresa Online 2.0 platform may inadvertently encourage hasty decision-making and insufficient preparation by offering such a speedy process. Although a quick company registration is beneficial in reducing bureaucratic procedures, it may also lead to an increase in poorly constructed business models, which are likely to fail in the long term.
A Double-Edged Sword
The multilingual feature of the platform, though advantageous in expanding its reach to foreign investors, also holds its share of challenges. While it’s a beneficial tool to foster global entrepreneurship, the platform should also consider the legal and cultural differences that come with international operations. If the system is standardized without respect for these differences, it might cause legal complications for foreign investors. Given this, seeking legal and accounting advice is recommended to avoid any mistakes before, during or after company incorporation.
The Empresa Online 2.0 platform’s speed and accessibility can inadvertently promote a lack of professional consultation in the company incorporation process, particularly among foreign investors. Creating a company so quickly could create an illusion of simplicity, thus deterring entrepreneurs from seeking crucial legal and accounting advice.
The swift, self-service model may lead foreign investors to believe they can handle the incorporation process independently. However, company incorporation involves complex legal and financial implications that can significantly impact the success and sustainability of a business. For example, understanding local tax laws, employment regulations, business operation laws, and many other aspects are vital to avoid legal complications in the future.
Without the guidance of legal and accounting professionals, foreign investors may inadvertently breach local laws or regulations due to ignorance or misunderstanding. This could lead to severe consequences such as penalties, legal actions, or even the dissolution of the business.
Furthermore, the fast-paced platform might not offer adequate guidance on financial planning. In a rush to establish their company, foreign investors might overlook critical financial aspects, like managing cash flow, setting pricing strategies, or understanding local taxation. This lack of financial preparedness could result in a premature failure of the company.
Quality Over Quantity
With the newly reformulated Empresa Online 2.0, we must ask whether this focus on speed and quantity benefits the business landscape. Creating companies at a high rate could lead to an over-saturated market with businesses that are ill-prepared to sustain themselves. This could have dire consequences, not only for individual entrepreneurs but also for the economic stability of the regions involved.
While the Empresa Online 2.0 platform is undoubtedly a symbol of progression, balancing this speed and innovation with the depth and quality required for successful entrepreneurship is essential. The platform has the potential to be a powerful tool for business creation, but only if these concerns are acknowledged and addressed with an equivalent degree of innovation and commitment.
Miguel Pinto-Correia holds a Master Degree in International Economics and European Studies from ISEG – Lisbon School of Economics & Management and a Bachelor Degree in Economics from Nova School of Business and Economics. He is a permanent member of the Order of the Economists (Ordem dos Economistas)… Read more
