Business law II - Setting up a business

6 important questions on Business law II - Setting up a business

What is a GmbH? What is needed to set up a GmbH?

A GmbH, a Limited liability company, is the most popular type of companies in Germany as one person is able to set up and the shareholders are not responsible for the company's debt. The share capital of a GmbH has to be 25,000€ from which only the half has to be paid and the rest can be somewhere in the company in form of e.g. Furniture. The company first exist when it has been registered into the Commercial Register.

What is a Mini-GmbH (UG)? What requirements are there to a Mini-GmbH (UG)?

A Mini-GmbH (UG) is the smaller version of the GmbH in which the entrepreneurs do not have to provide a minimum capital when starting the business. Instead, 25% of the profits each year have to be put aside until it reaches the 25,000€ of a GmbH, where they will convert to a standard GmbH. The disadvantage of this form is that the company has to operate under the name Mini-GmbH (UG) which means that people will know that no money was invested into the company.

What is an Aktiengesellschaft? What are the requirements of an AG?

An AG is a joint stock company for which a minimum of five members and a minimum share capital of 50,000€ are required to set it up. The stocks in an AG may be listed on the stock exchanges but they do not have to be. Like a GmbH, an AG first becomes a legal entity when it has been registered in the Commercial Register.
An AG is also required to have a managing board and a supervisory board.
  • Higher grades + faster learning
  • Never study anything twice
  • 100% sure, 100% understanding
Discover Study Smart

What is an OHG? What are the requirements of an OHG?

An OHG is a general partnership in which the shareholders, in contrast to AG and GmbH, have unlimited liability. This means that they are personally responsible for the debt of the company. All partners in the OHG are obliged to participate actively in the operating business and represent the business unless they have agreed otherwise.

What is a GmbH & Co. KG? What are the role of the two parts?

A GmbH & Co. KG is a limited partnership with a limited liability company as a general partner, in which the GmbH is personally liable for the business and runs the business and KG is only liable for its own share of the company. In order to make a GmbH & Co. KG you have to set up both a GmbH and a KG where afterwards the GmbH is running the KG.

What is a KG? What are the roles of the partners?

A KG is a limited partnership, which consists of two partners where one has unlimited liability and the other has a limited liability, which means he is only liable for his share of the company. The unlimited partner has the right to run the business.

The question on the page originate from the summary of the following study material:

  • A unique study and practice tool
  • Never study anything twice again
  • Get the grades you hope for
  • 100% sure, 100% understanding
Remember faster, study better. Scientifically proven.
Trustpilot Logo