8 ms·

Really? 5 years? That seems really harsh. Is it all business failures or does it have to be due to mismanagement? I've heard the climate is very hostile to busi

Really? 5 years? That seems really harsh. Is it all business failures or does it have to be due to mismanagement? I've heard the climate is very hostile to businesses in Germany; my sister in law was trying to sell art on etsy and apparently she had to get a business license to do so in Germany. She's now back in the USA where she can just sell stuff online and the only thing she needs to do is file her taxes correctly

charlieyu1 3y ago
You know, all regulations only hurt small sellers, people at the “top” always get away from all the crap they are directly responsible for, no matter they are hurting their own business or the society as a whole
- Timon3 3y ago
  It's the wrong take-away to say all regulations only hurt small sellers. Do you want to give up regulations on child labor, or worker safety, or foods and drugs? If not, how come, considering it all hurts only small sellers? The problem isn't the concept of regulation, but the follow-through on loopholes. By doing away with regulations you'll decrease quality of life for most people. Instead we have to find ways to react to loopholes in a fair way. It's not impossible, we've done it before, see the previously-mentioned examples!
  - charlieyu1 3y ago
    I don't think small sellers have anything to do with child labour. And since you mentioned loopholes, it is always the big players who get away with loopholes that small business owners do not
    - akiselev 3y ago
      Small sellers aren’t worth even going after until they reach a certain size for huge swaths of the regulatory regime. See, for example, UL/CE and FCC regulations - unless they burn something down or interfere with emergency services, businesses can usually defer the regulatory cost till they can afford it. Or the FAA, which gives out slaps on the wrist like its going out of style, as long as the offender is not an airline. Case in point: many countries allows underage family members to work for family businesses and even the ones that don’t, barely enforce it. A factory hiring dozens of kids? That’s a lot less likely to go unnoticed.
    - piaste 3y ago
      > I don't think small sellers have anything to do with child labour. This is a remarkable claim. Why would you think that?
    - Jochim 3y ago
      Business owners get away with breaking violating the law. Small businesses are infamous for paying people under the table, stealing wages, not giving appropriate breaks, employing children etc.. The size of a business only affects the kind of laws they're likely to get away with breaking.
- KyeRussell 3y ago
  [flagged]
  - charlieyu1 3y ago
    Don't want to sway away from the discussion, but it's probably the first time for ages I'm called a libertarian.
  - mlyle 3y ago
    Digging into his post history to avoid refuting his point (which is overstated) is ... not appropriate? great? I can pretty easily agree with a weaker version of his statement: regulations have a disproportionate impact on small entities. They're expensive to comply with, and small entities tend not to have access to the exotic legal tricks and arms-length interaction with regulations that can make them much less effective.
    - LadyCailin 3y ago
      For the first one, if we can agree the regulation is good, then so be it. If your business can only thrive by hurting other people, you don’t get to be in business, that isn’t a more fundamental right than not being harmed by businesses. For the second, the solution is to plug loopholes that allow businesses of any size to bypass regulations. In no case is it the correct solution to get rid of good regulations.
      - mlyle 3y ago
        > For the first one, if we can agree the regulation is good, then so be it. IMO: If we can agree that the regulation has a net good effect, considering externalities and adverse effects. Having a "good regulation" that also increases concentration of control in an industry can end up being a net negative. > For the second, the solution is to plug loopholes that allow businesses of any size to bypass regulations. This is a nice thing to strive for, but in practice layers of indirection and ample legal counsel accomplishes a lot even in well-run democracies (even leaving aside how large organizations often influence how they are regulated in both direct and indirect ways).
ChuckNorris89 3y ago
>she had to get a business license to do so in Germany. She's now back in the USA where she can just sell stuff online If you want to sell in the Germany, get a business license from Estonia or Romania or some other low-cost low-bureocracy EU country, and pay your taxes there. Germany is still living in the business climate of the '60s.
- tom-from-july 3y ago
  This is terrible advice and you or actually your Estonian company will be fined for tax fraud. In Germany income is taxed where it is generated, which includes the head of the person running the business. So if you run your foreign company from Germany - which is expect to be the case if you have no physical permanent office in Estonia, where you also have to be regularly present - you home is considered to be an business location and thus you are taxed accordingly. Note that this only applies to limited liability companies. If you are a single person with no need for limited liability, just register an individual business (Einzelunternehmen) with your local authority (Gewerbeamt). It’s really easy, cheap and if you need support, tax consulting for individual business is rather cheap as well and worth it if your business generates regular income. Otherwise you can just talk to the authorities, because income from passion projects (i.e. non-regular, without the goal of generating a substantial income amount) is not taxed at all.
  - ChuckNorris89 3y ago
    >In Germany income is taxed where it is generated Only if you're a resident in Germany, But if I live somewhere in the EU and sell something to someone living in Germany I don't owe income tax to the German government. I pay my income tax where I'm a fiscal resident (Estonia, Romania, etc.)
    - tom-from-july 3y ago
      Lucky you in this case, not having to learn and deal with all this then :) But the original comment was about someone living in Germany (at least at the time)
mantas 3y ago
Can’t speak about Germany for sure, but usual euro way is you don’t need to do taxes at all if you do not run a business. Employer fills it for you. And getting a doing-business-as-individual is as simple as filling a form at revenue service website telling you’re starting a business. Then you get a tax ID to put on your invoices next day. If you sell as an individual, it’s just you selling random stuff that you don’t need to pay taxes for. Once you do this as a business, you declare it as such and notify the state about it.
- psd1 3y ago
  Germany is notoriously bureaucratic. And Spain is just pure fucking hell. Notaries should be hunted for sport. Britain is great. I can file my taxes online relatively painlessly for any non-employment income. Employment income is done automatically. To set up a small business, I buy public liability insurance and a domain. Many tasks that require multiple notary appointments in Spain can be done online or, for some obscure processes, at the post office. I suspect that business climate divides sharply between the north and south, with Germany and France being honorary southerners. I'd love to unpack the link between Catholicism and stultifying bureaucracy, since both involve archaic institutions imposing themselves between oneself and one's goal.
  - mantas 3y ago
    I doubt there's much link with Catholicism. Here in Lithuania bureaucracy is pretty simple as I described above. From what I hear Poland is even easier.
  - mpweiher 3y ago
    > I suspect that business climate divides sharply between the north and south, with Germany and France being honorary southerners. The Economist Intelligence Unit ranks Germany 13th in its global business environment index, the UK 15th. In the local index, it's 7th vs. 9th. https://country.eiu.com/article.aspx?articleid=222209005&Country=Germany&topic=Business&subtopic=Business+environment&subsubtopic=Rankings+overview https://country.eiu.com/article.aspx?articleid=222209005&Cou... https://country.eiu.com/article.aspx?articleid=402870423&Country=United+Kingdom&topic=Business&subtopic=Business+environment&subsubtopic=Rankings+overview https://country.eiu.com/article.aspx?articleid=402870423&Cou...
belter 3y ago
Many other countries have similar laws. Normally get's solved by buying an existing business...
avianlyric 3y ago
> Really? 5 years? That seems really harsh. Is it all business failures or does it have to be due to mismanagement? There’s a big difference between bankruptcy and business failure. Plenty of businesses fail without entering bankruptcy, they’re wound down responsibly and their creditors are repaid in full. If a company fails due to bankruptcy, then it means that people who lent money to that business are out of pocket, and end up paying for the failure. The whole point of “limited liability” companies is that the owners and management are shielded from creditors in the event of bankruptcy (hence the “limited liability”). So a five year ban (which is true in most countries) from directing another limited liability company is reasonable, it don’t prevent your from running a business, only from running a limited liability business, because there’s now evidence that in the event of failure you’ll leave your creditors high and dry. Ultimately the privilege of running a limited liability company, where the state promises to protect you from your creditors if things go wrong, is just that, a privilege. If you prove yourself unable use that privilege responsibly, then that privilege is temporary taken away. To be clear, the privilege removed is protection from creditors by the state, if your business fails. You can absolutely start another business, it’s just that the state won’t protect you if you fail.
- AbrahamParangi 3y ago
  The counterpoint is what's the point of reducing losses on bankruptcy if it makes the entire business climate worse? By trying to protect creditors you just make everyone poorer.
  - KyeRussell 3y ago
    This is an ideological take, and an American one at that. Not necessarily a fact.
    - AuthorizedCust 3y ago
      It reflects a system where that shields creditors from fewer risks. Nothing wrong with that per se.
    - 3y ago
simplotek 3y ago
> Really? 5 years? That seems really harsh. Bankruptcy is not a mild consequence. People can and often are ruined by a bankruptcy, not to mention the harsh impact that it has on employees who are suddenly forced out of a job. Declaring bankruptcy should not be considered as something mundane or yet another run-of-the-mill managerial decision. Also, not being able to found a company is not what I would call "harsh". Even in a purely capitalist view of society, a entrepreneur needs to focus on ventures to ensure they are successful, and "failing fast" does not mean it's ok to file for bankruptcies.
- martinald 3y ago
  But a lot of businesses fail for reasons other than the directors "mistakes". The general macro trend has a lot to do with it. Should the owners of a cafe or bar that went under owing suppliers some money during covid be banned from starting a new business? Or someone who buys a failing business trying to turn it around and failing also be barred for 5 years? At the end of the day, creditors must (and generally do) realise when supplying a limited liability company there is a risk that the company goes under you won't get paid. That's why credit insurance and credit control departments exist. If the directors were committing fraud by misrepresenting the state of the business and it fails, that is a completely different thing and directors should be barred from trading. But businesses fail all the time and we must accept that. Barring people from trying again for 5 years isn't a great solution imo.
  - detuur 3y ago
    The 5-year ban is not an automatic outcome, I believe. Afaik it's imposed specifically in cases of gross mismanagement/fraud.
  - simplotek 3y ago
    > But a lot of businesses fail for reasons other than the directors "mistakes". All the more reason why entrepreneurs should not take lightly the prospect of filing for bankruptcy, and should focus their energy on ventures where they can minimize the chance of burning through cash right into bankruptcy. Otherwise it starts to sound like these serial entrepreneurs are just flinging crap at a wall to see which one will stick with little to no effort. This is a massive disservice to investors and employees alike, if not outright fraud.

charlieyu1 3y ago

You know, all regulations only hurt small sellers, people at the “top” always get away from all the crap they are directly responsible for, no matter they are hurting their own business or the society as a whole

Timon3 3y ago
It's the wrong take-away to say all regulations only hurt small sellers. Do you want to give up regulations on child labor, or worker safety, or foods and drugs? If not, how come, considering it all hurts only small sellers? The problem isn't the concept of regulation, but the follow-through on loopholes. By doing away with regulations you'll decrease quality of life for most people. Instead we have to find ways to react to loopholes in a fair way. It's not impossible, we've done it before, see the previously-mentioned examples!
- charlieyu1 3y ago
  I don't think small sellers have anything to do with child labour. And since you mentioned loopholes, it is always the big players who get away with loopholes that small business owners do not
  - akiselev 3y ago
    Small sellers aren’t worth even going after until they reach a certain size for huge swaths of the regulatory regime. See, for example, UL/CE and FCC regulations - unless they burn something down or interfere with emergency services, businesses can usually defer the regulatory cost till they can afford it. Or the FAA, which gives out slaps on the wrist like its going out of style, as long as the offender is not an airline. Case in point: many countries allows underage family members to work for family businesses and even the ones that don’t, barely enforce it. A factory hiring dozens of kids? That’s a lot less likely to go unnoticed.
  - piaste 3y ago
    > I don't think small sellers have anything to do with child labour. This is a remarkable claim. Why would you think that?
  - Jochim 3y ago
    Business owners get away with breaking violating the law. Small businesses are infamous for paying people under the table, stealing wages, not giving appropriate breaks, employing children etc.. The size of a business only affects the kind of laws they're likely to get away with breaking.
KyeRussell 3y ago
[flagged]
- charlieyu1 3y ago
  Don't want to sway away from the discussion, but it's probably the first time for ages I'm called a libertarian.
- mlyle 3y ago
  Digging into his post history to avoid refuting his point (which is overstated) is ... not appropriate? great? I can pretty easily agree with a weaker version of his statement: regulations have a disproportionate impact on small entities. They're expensive to comply with, and small entities tend not to have access to the exotic legal tricks and arms-length interaction with regulations that can make them much less effective.
  - LadyCailin 3y ago
    For the first one, if we can agree the regulation is good, then so be it. If your business can only thrive by hurting other people, you don’t get to be in business, that isn’t a more fundamental right than not being harmed by businesses. For the second, the solution is to plug loopholes that allow businesses of any size to bypass regulations. In no case is it the correct solution to get rid of good regulations.
    - mlyle 3y ago
      > For the first one, if we can agree the regulation is good, then so be it. IMO: If we can agree that the regulation has a net good effect, considering externalities and adverse effects. Having a "good regulation" that also increases concentration of control in an industry can end up being a net negative. > For the second, the solution is to plug loopholes that allow businesses of any size to bypass regulations. This is a nice thing to strive for, but in practice layers of indirection and ample legal counsel accomplishes a lot even in well-run democracies (even leaving aside how large organizations often influence how they are regulated in both direct and indirect ways).

ChuckNorris89 3y ago

>she had to get a business license to do so in Germany. She's now back in the USA where she can just sell stuff online If you want to sell in the Germany, get a business license from Estonia or Romania or some other low-cost low-bureocracy EU country, and pay your taxes there. Germany is still living in the business climate of the '60s.

tom-from-july 3y ago
This is terrible advice and you or actually your Estonian company will be fined for tax fraud. In Germany income is taxed where it is generated, which includes the head of the person running the business. So if you run your foreign company from Germany - which is expect to be the case if you have no physical permanent office in Estonia, where you also have to be regularly present - you home is considered to be an business location and thus you are taxed accordingly. Note that this only applies to limited liability companies. If you are a single person with no need for limited liability, just register an individual business (Einzelunternehmen) with your local authority (Gewerbeamt). It’s really easy, cheap and if you need support, tax consulting for individual business is rather cheap as well and worth it if your business generates regular income. Otherwise you can just talk to the authorities, because income from passion projects (i.e. non-regular, without the goal of generating a substantial income amount) is not taxed at all.
- ChuckNorris89 3y ago
  >In Germany income is taxed where it is generated Only if you're a resident in Germany, But if I live somewhere in the EU and sell something to someone living in Germany I don't owe income tax to the German government. I pay my income tax where I'm a fiscal resident (Estonia, Romania, etc.)
  - tom-from-july 3y ago
    Lucky you in this case, not having to learn and deal with all this then :) But the original comment was about someone living in Germany (at least at the time)

mantas 3y ago

Can’t speak about Germany for sure, but usual euro way is you don’t need to do taxes at all if you do not run a business. Employer fills it for you. And getting a doing-business-as-individual is as simple as filling a form at revenue service website telling you’re starting a business. Then you get a tax ID to put on your invoices next day. If you sell as an individual, it’s just you selling random stuff that you don’t need to pay taxes for. Once you do this as a business, you declare it as such and notify the state about it.

psd1 3y ago
Germany is notoriously bureaucratic. And Spain is just pure fucking hell. Notaries should be hunted for sport. Britain is great. I can file my taxes online relatively painlessly for any non-employment income. Employment income is done automatically. To set up a small business, I buy public liability insurance and a domain. Many tasks that require multiple notary appointments in Spain can be done online or, for some obscure processes, at the post office. I suspect that business climate divides sharply between the north and south, with Germany and France being honorary southerners. I'd love to unpack the link between Catholicism and stultifying bureaucracy, since both involve archaic institutions imposing themselves between oneself and one's goal.
- mantas 3y ago
  I doubt there's much link with Catholicism. Here in Lithuania bureaucracy is pretty simple as I described above. From what I hear Poland is even easier.
- mpweiher 3y ago
  > I suspect that business climate divides sharply between the north and south, with Germany and France being honorary southerners. The Economist Intelligence Unit ranks Germany 13th in its global business environment index, the UK 15th. In the local index, it's 7th vs. 9th. https://country.eiu.com/article.aspx?articleid=222209005&Country=Germany&topic=Business&subtopic=Business+environment&subsubtopic=Rankings+overview https://country.eiu.com/article.aspx?articleid=222209005&Cou... https://country.eiu.com/article.aspx?articleid=402870423&Country=United+Kingdom&topic=Business&subtopic=Business+environment&subsubtopic=Rankings+overview https://country.eiu.com/article.aspx?articleid=402870423&Cou...

belter 3y ago

Many other countries have similar laws. Normally get's solved by buying an existing business...

avianlyric 3y ago

> Really? 5 years? That seems really harsh. Is it all business failures or does it have to be due to mismanagement? There’s a big difference between bankruptcy and business failure. Plenty of businesses fail without entering bankruptcy, they’re wound down responsibly and their creditors are repaid in full. If a company fails due to bankruptcy, then it means that people who lent money to that business are out of pocket, and end up paying for the failure. The whole point of “limited liability” companies is that the owners and management are shielded from creditors in the event of bankruptcy (hence the “limited liability”). So a five year ban (which is true in most countries) from directing another limited liability company is reasonable, it don’t prevent your from running a business, only from running a limited liability business, because there’s now evidence that in the event of failure you’ll leave your creditors high and dry. Ultimately the privilege of running a limited liability company, where the state promises to protect you from your creditors if things go wrong, is just that, a privilege. If you prove yourself unable use that privilege responsibly, then that privilege is temporary taken away. To be clear, the privilege removed is protection from creditors by the state, if your business fails. You can absolutely start another business, it’s just that the state won’t protect you if you fail.

AbrahamParangi 3y ago
The counterpoint is what's the point of reducing losses on bankruptcy if it makes the entire business climate worse? By trying to protect creditors you just make everyone poorer.
- KyeRussell 3y ago
  This is an ideological take, and an American one at that. Not necessarily a fact.
  - AuthorizedCust 3y ago
    It reflects a system where that shields creditors from fewer risks. Nothing wrong with that per se.
  - 3y ago

simplotek 3y ago

> Really? 5 years? That seems really harsh. Bankruptcy is not a mild consequence. People can and often are ruined by a bankruptcy, not to mention the harsh impact that it has on employees who are suddenly forced out of a job. Declaring bankruptcy should not be considered as something mundane or yet another run-of-the-mill managerial decision. Also, not being able to found a company is not what I would call "harsh". Even in a purely capitalist view of society, a entrepreneur needs to focus on ventures to ensure they are successful, and "failing fast" does not mean it's ok to file for bankruptcies.

martinald 3y ago
But a lot of businesses fail for reasons other than the directors "mistakes". The general macro trend has a lot to do with it. Should the owners of a cafe or bar that went under owing suppliers some money during covid be banned from starting a new business? Or someone who buys a failing business trying to turn it around and failing also be barred for 5 years? At the end of the day, creditors must (and generally do) realise when supplying a limited liability company there is a risk that the company goes under you won't get paid. That's why credit insurance and credit control departments exist. If the directors were committing fraud by misrepresenting the state of the business and it fails, that is a completely different thing and directors should be barred from trading. But businesses fail all the time and we must accept that. Barring people from trying again for 5 years isn't a great solution imo.
- detuur 3y ago
  The 5-year ban is not an automatic outcome, I believe. Afaik it's imposed specifically in cases of gross mismanagement/fraud.
- simplotek 3y ago
  > But a lot of businesses fail for reasons other than the directors "mistakes". All the more reason why entrepreneurs should not take lightly the prospect of filing for bankruptcy, and should focus their energy on ventures where they can minimize the chance of burning through cash right into bankruptcy. Otherwise it starts to sound like these serial entrepreneurs are just flinging crap at a wall to see which one will stick with little to no effort. This is a massive disservice to investors and employees alike, if not outright fraud.