Limited company

The concept of the corporation is finally defined in the heading for the second section of the third book of the Commercial Code: Supplementary rules for corporations ( joint stock companies, partnerships limited by shares and limited liability companies ) and certain commercial partnerships.

The corporation is a content based on a social contract corporation under private law, whose members have a common, usually economic, purpose. It is a legal person. Corporations are characterized by mandatory capital deposition and conservation regulations.

According to statute, in Germany there are the following types of corporations:

  • The Aktiengesellschaft ( AG) with the special form of the European Company (SE)
  • The partnership limited by shares ( KGaA)
  • The limited liability company ( GmbH)
  • The entrepreneurial company ( limited liability)

The legal form of legal mining trade was abolished.

Foreign " corporations " are not corporations within the meaning of the Commercial Code and also can not be established in Germany. Something else arises not from the " Centros " - law of the ECJ, since this simply states that a company incorporated in another EU country must carry out their business through a branch in the country fully. However, the foreign company must continue to be based abroad, since only the registry entry is constitutive.

  • 7.1 limited Partnership
  • 7.2 Open Society
  • 7.3 mixing companies
  • 7.4 Other legal entities
  • 7.5 start-up phase
  • 9.1 Japan
  • 9.2 New Zealand
  • 9.3 United Kingdom
  • 9.4 United States of America

Nature of the corporation

Conceptually build the corporations on the model of the association.

Corporations can be operated for any legally authorized purpose. Regardless of whether the purpose is an economic or intangible, a corporation is a form of merchant. Corporations may be established by one or more persons. Therefore, a one-man limited companies or one-man - AGs are possible.

Corporations are characterized by the following features:

In general, a corporation after payment of the contribution to the person of its members (owners, shareholders) is no longer interested because the shareholders have to stand up for company liabilities with neither their wealth nor to provide any services to the Company have (→ contrary partnership ).

Types of corporations

The legal forms defined by the legislature as corporations can, for example, after the circulation ability of the Shares will be typed on the management of the Company (in the case of a GmbH 's stake in AG share) and the degree of participation of the shareholders.

For circulation

Under German law, in the GmbH, the business share is transmitted only by a notarized contract of assignment (§ 15 III Limited Liability Companies Act ). The same applies to assign one share of the obligation. The assignment may be subject to the approval of the company in the partnership agreement (§ 15 V Limited Liability Companies Act, transfer restrictions ).

A stock can, however, as a bearer bond or order document will be represented (§ 10 AktG). This has the consequence that the stock may be transferred in accordance with the provisions awareness of a security. Shares are therefore also suitable as effects. The statutes, however, the transfer of shares are also bound to the approval of the Company ( § 68 II AktG, transfer restrictions ).

The much better circulation ability of the stock in relation to business share shows that the AG is designed according to the idea of the legislature on a strong member changes and the exchange capability, the limited liability company to a greater resistance of the person of its shareholders.


Basically responsible for the GmbH the directors to conduct the business of the Company. The shareholders' meeting may be the CEO, to the extent permitted by the partnership agreement, at any time impose restrictions ( § 37 I Limited Liability Companies Act ).

In the AG, the Management Board to operate the Board ( § 77 AktG). The general meeting may on matters of management, however, only at the request of the Board (§ 119 II AktG). The shareholders of AG are thus largely limited to an equity investment.

The principle impossibility of the general meeting of a public limited company to take directly to the management of the company influence, makes the legislative mission statement clearly what the AG is designed compared to the GmbH to a larger number of members.

Ordinary and capital

Is the ordinary and capital of the company, which is introduced in the foundation and can also be changed later basis for economic action. The corporation is liable if it has been agreed otherwise in external relations, without limitation with their company's assets. If this is consumed, the corporation suffers an insolvency. Only in so far as the shareholders of the consumption of capital can be accused of abuses and demonstrated it meets the so-called Existenzvernichtungshaftung liability.

Corporation and business owners personally liable

Even today there are still entrepreneurs who consciously decide against the use of corporations. Especially among freelancers and small self-employed full liability is widespread. reasons:

  • The costs associated with the corporation disclosure requirements are often spared.
  • In industries or companies with low-risk liability plays only a minor role.
  • Many large creditors (eg, banks) can be secured their demands with personal guarantees from the shareholders. Thus, the effect of the limitation of liability is severely limited.
  • The cost of a corporation exceed that of a sole trader.

Rights of shareholders

The shareholders do not have direct rights to the assets of the Company. The essential rights of shareholders are:

  • Voting rights at the shareholders' meeting ( unless specifically stated otherwise: preferred stock )
  • Dividends in accordance with the shareholders' resolution
  • Share in the liquidation proceeds of liquidation of the Company ( residual )

Size classes

Corporations are divided into three size classes in the balance right: small, medium and large companies. Depending on the size of the company stricter accounting requirements are imposed. The distinction in the size class has significance especially for the disclosure requirements.

The classification of a society is determined by § 267 HGB based on the characteristics total assets, revenues and number of employees.

Accruals / terminology

Limited partnership

The limited partnership is a commercial company as opposed to the corporation. The position of the limited partners is similar but because of the lack of power after the deposit personal liability, and the exclusion of the limited partners of the management of the company to the position of a shareholder.

Public company

A public company is a company whose shares are widely held in common parlance. It is therefore not a legal category, but a factual description of the members of the circle, which is atomized in this case. The public company limited here by the family company from whose equity interests are held in a narrow family framework.

In the West German legal language is meant by a public company primarily any society, irrespective of their legal form, whose equity securities are widely held. The German case law seems at times to use the concept of a public company for private companies, which, due to the wide dispersion of the participation rights capital- social traits. However, these are quite real and not a legal category: criterion is not the legal form of the company, but the distribution of membership rights under a variety of mutually particularly associated persons, each holding small shares.

In Switzerland, however, a public company is legally conclusively defined. It is present when a company is listed on a stock exchange or when it has issued bonds or if it contributes at least 20 percent of the assets or turnover to the financial statements of a company which is listed on a stock exchange either or has issued bonds.

Mixed companies

One frequently used in practice is that the complement of a KG is not a natural person but a limited liability company or joint stock company (for example, a GmbH & Co. KG ). It comes therefore economically close to a corporation.

Other legal entities

Cooperatives and economic associations are corporations as well as legal persons. They differ by the lack of rules on capital raising and conservation. They can be used similar to the corporations.

Start-up phase

For the period between the application for registration in the Commercial Register and the allocation of Registration Number corporations partly lead the addition of " i G. " for" in formation " behind the company. For such a society, the rights of the registered society be partial - see pre- GmbH.

National accounts

The Economics of Accounts differ financial and non-financial corporations.

Situation in other countries


Kabushiki Kaisha see

New Zealand

The New Zealand law provides only one corporation before, or the Limited Corporation is called, and is derived from the British version. The New Zealand " Companies Act 1993 " makes no distinction between "private" and "public" corporations. In New Zealand, the minimum capital is $ 1 NZ. The management consists of at least one director. A secretary, as in British law is not provided. Registration of Limited costs NZ $ 100-200.

United Kingdom

In the United Kingdom of Great Britain and Northern Ireland there is a private and a "public" version of the corporation, which can be compared with the German GmbH or AG: Private company limited by shares (Ltd. ) is a small, private circle of partners reserved, while the Public Limited Company ( PLC) may be listed on the stock exchange. The management of Ltd.. consists of one or more directors. Imperative is also the appointment of a Secretary. Both organs may be represented by another company, which is made ​​of smaller Ltd. 's especially for the secretary often. When PLC is a minimum qualification is required (eg as a lawyer or accountant ) for the secretary. The minimum capital of Ltd.. is a British pound (GBP), the PLC £ 50,000.

United States of America

See Company Law of the United States # Corporation