Austrian LLC Incorporation

The GmbH is the most widespread form of company in Austria. A GmbH can be founded by one or more persons for almost any purpose. In business life it conveys to the business partner a certain degree of seriousness of his own enterprise. For partners, there is a basic limitation of their liability with the amount of their capital contribution.

In the following article we will present essential aspects in connection with the incorporation of an Austrian GmbH.

 

The GmbH is the most popular legal form in Austria and rightly so

 

Brief Outline for Establishing a GmbH

• Drawing up the articles of association (the declaration of formation in the case of individual founders) in notarial form;
• shareholder resolution regarding the appointment of the management;
• Opening of the limited liability company's bank account and payment of the capital contributions;
• Signing the application for registration of the GmbH in the commercial register (in certified form);
• Model signature declaration of each managing director (in certified form);
• submission of the application for registration in the Commercial Register together with enclosures to the Commercial Register Court;
• Registration of the GmbH in the commercial register (= formation of the GmbH);
• Registration with the tax office and application for a tax number;
• Possible registration with the register of beneficial owners (WiEReG);
• Possible social security registration of employees;
• Possible registration of a business including appointment of the management under trade law.

What is the Firm?

The company name is the name under which a business is operated, registered in the commercial register and under which the entrepreneur also signs.

What Types of Companies can be selected?

A distinction is made between personal companies, factual companies and fantasy companies. A mixture of these types of companies is also permitted. The personal company would be in the name of the sole proprietor or a partner. The factual company, on the other hand, refers to the concrete business purpose (e.g. Müller Automobil GmbH). Arbitrary letters and word sequences are used for the fantasy company. However, the impression of a personal company should be avoided.

What other Company Requirements must be observed?

The company name must be suitable to identify the company, be distinctive and not misleading. Accordingly, the company name should enable a distinction to be drawn from other companies in order to be distinctive for the purposes of trade.

The company name may consist of upper and lower case letters, but also of numbers. In any case, the company name must be pronounceable, which would not be the case with mere signs. It is mandatory to add the legal form suffix (e.g. GmbH) to the company name.

When indicating locations, care must be taken to ensure that correct notions of the entrepreneur's place of business and the nature and scope of this business are conveyed. This applies to the use of words such as "Austria", "International" etc.

As the commercial register court checks whether a company already exists in the same municipality before the GmbH is entered in the commercial register, it is advisable to agree the concretely intended company name with the commercial register court.

Apart from existing companies, a possible collision with the rights of other persons must also be taken into account from the point of view of trademark and/or competition law.

How high must the Share Capital be?

The share capital of a GmbH must be at least EUR 35,000. The individual shareholders each make a specific capital contribution, which is stipulated in the articles of association. The sum of all capital contributions must reach the amount of the share capital. When founding a "regular" GmbH, at least a total of EUR 17,500.00 must be paid up in cash. If at the beginning no more cash is required for the business activities of a "regular" GmbH, the following deposit variant is common: share capital - EUR 35,000.00; all in all paid up: EUR 17,500.00.

What is the "privileged" LLC (Gründungsprivilegierung)?

If this form of foundation is chosen, the foundation privileged share capital must amount to at least EUR 10,000. Half of this, i.e. EUR 5,000, must be paid in cash. The foundation privilege is valid for a period of 10 years from the foundation of the GmbH.

What is the Line of Business?

The object of the company describes the concrete field of activity of the company. In principle, this defines the framework within which the Company may conduct business activities. It is also important for a possible prohibition of competition by shareholders. If the object of the company is to be subsequently changed or extended, it is necessary to amend the articles of association. Such an amendment is in principle only possible by means of a unanimous resolution by the shareholders at a general meeting and must be certified by a notary. Therefore, the object of the company must be chosen with care, especially from the point of view of costs and expenses.

The (commercial) Management Director

The (commercial) management is the management body of the company and consists of at least one natural person. In addition to the appointment of external managing directors (outside directors), it is also possible for shareholders to assume the position of managing director (shareholding directors). Managing directors are usually appointed by shareholders' resolution at a general meeting or by circular letter. The managing directors are responsible for the entire management of the GmbH as well as the representation in and out of court. They are thus entrusted with the management of the company in internal and external relationships. If several managing directors are appointed, their specific power of representation must be determined (individually or jointly with other managing directors).

Our Package for Establishing a GmbH

You need support with the foundation of a GmbH? With our incorporation package, we support you from the drafting of the contract to the entry in the commercial register.

Your DWP team

E-Mail: wien@daxundpartner.at

Phone: +43 5 9004 300

 

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