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Careful study of German company types

· Germany

Europe is the world's largest market with nearly 500 million consumers. In Europe, Germany is the state with the largest and most important economies, making it the most attractive business location in the European Union. Company Formation in Germany can be very cheap. From office management fees to living expenses, Germany is cheaper than most European counterparts.

There are 4 main business entities in Germany:

  • Limited Liability Corporation (GmbH)
  • Mini – GmbH
  • Stock Corporation (AG)
  • Partnerships
  • Limited Liability Corporation (GmbH)

The limited liability company (GmbH) is the most widely used commercial entity in Germany. The minimum required share capital is €25,000, but this can be made up of in-kind contributions. At the time of the merger of the limited liability company, at least €12,500 must be provided. The company only needs one director and one shareholder.

Mini – GmbH (AnUnternehmergesellschaft -UG)

The capital of “mini-GmbH” (AnUnternehmergesellschaft - UG) can be as low as 1 Euro or as much as 25,000 Euros required by the General Company (GmbH). This type of company is very popular among international investors who find that low investment is an advantage of their business strategy of developing and developing in Germany. A quarter of the mini-GmbH's annual profit must contribute to its capital reserve until it reaches 25,000 euros, at which point UG can become a regular limited liability company.

Stock Corporation (AG)

A Stock Corporation (AG) is the standard company form of the major listed companies in Germany. The minimum share capital of AG is 50,000 euros and the company may have at least one shareholder. Such companies are strictly regulated as listed companies. AG has a “two-layer board” structure consisting of an oversight committee and a management committee. The board of supervisors is usually controlled by shareholders. The management committee directly manages the company, but members of the committee may be removed by the supervisory committee.

Partnerships

There are two main legal forms of partnership; general partnerships (OHG) or limited partnerships (KG). In OGH, all partners are fully responsible for the partnership debt, while in KG, there is a general partner with unlimited liability, and the limited partner is limited to a fixed contribution to the partnership. Partnerships are widely used in family businesses and small businesses in Germany.

For more information on German Company Formation, please do not hesitate to contact us on +91-9599293700 or email office@ondemandint.com

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