eresidency

e-Residency, often written as e-Residency or e-residency, is a program developed by the Republic of Estonia that provides a legally binding digital identity to non-residents, enabling access to Estonia’s digital services and the ability to establish and manage an EU-based company online.

Key features include a digital ID linked to a cryptographic key stored on a smart card or USB device, and online authentication and signing capabilities. With the ID, e-residents can use digital services such as the e-Business environment, e-Banking, and e-Tax, and they can register and run an Estonian company entirely online.

How it works: Applicants apply online with documents, pay the fee, and then complete a short in-person verification at an Estonian embassy or consulate to receive the digital identity. The program does not provide physical residency, citizenship, or visa rights, and it does not guarantee a bank account.

Benefits and uses: It provides a path for non-residents to establish and manage a European company with access to EU markets, often with simplified corporate administration and Estonia’s transparent corporate tax framework, where profits are taxed only when distributed.

Limitations and criticisms: It does not grant immigration rights; banks and service providers may require substantive business activity or local presence; regulatory and AML rules apply; there are concerns about misuse for illicit activities and privacy.

History: Announced in 2014 as a digital governance initiative; launched for public use in 2014–2015; by the 2020s it enrolled tens of thousands of e-residents and issued numerous digital IDs.