Information on Company Registration

Information on Company Registration

German law offers different legal forms for doing business. The most attractive for foreign founders is the limited liability company (Gesellschaft mit beschrankter Haftung - GmbH). GmbH is a legal entity whose founders are liable only for their contributions and not for personal assets. Each founder is only liable for the company's debts to the extent of its share. The profit received at the end of the year is distributed according to the shares of the GmbH shareholders.

The founders of the company may be one or more natural and/or legal persons, including foreign ones. The founders appoint one or more management companies. The law also does not provide for any restrictions depending on the nationality or place of residence of the founders, i.e. foreigners or stateless persons may be founders of German limited liability companies.

The establishment of a GmbH is carried out by the parties to the memorandum of association; it is necessary even if only one person is the founder. The contract must necessarily contain the following provisions:

  • Company name
  • Registered address of the company
  • Types of activities
  • Share capital (Stammkapital)
  • Distribution of shares among founders
  • Duration of existence of the GmbH
  • Appointment and powers of managers

The contract is certified by a notary public, after the new company is registered in court, which is recorded in the Commercial Register. From this moment on, the GmbH acquires the status of a legal entity.