Austrian commercial law offers a variety of incorporated and unincorporated forms of business. The most common forms in which a foreign enterprise may operate in Austria are the Limited Liability Company (Gesellschaft mit beschrдnkter Haftung (GesmbH or GmbH)) and the Stock Corporation (Aktiengesellschaft (AG). The Gesellschaft mit beschränkter Haftung (GmbH) is a separate legal entity that essentially limits the responsibility of the shareholders to the amount of share capital (capital stock or common equity) owned. Most foreign-owned businesses in Austria are operating in that legal form. The law of the limited liability company is governed by the Limited Liability Companies Act (Gesetz über Gesellschaft mit beschränkter Haftung).
The name of the company must be in Latin characters and must end with GmbH to denote limited liability.
MEMORANDUM AND ARTICLES OF ASSOCIATION
It is necessary to adopt Articles of Associates when founding a GmbH. The company becomes a legal entity when it is formally entered in the business register (Firmenbuch) kept by the commercial court (Handelsgericht) having local jurisdiction. The articles of association must be adopted in the form of a notarial deed (Notariatsakt). Single ownership of share interests (a one-man-company) is permitted. Austrian law permits signing by proxy, if the proxy holds a written special power of attorney (Spezialvollmacht). By law, the articles of associates must contain at least: the corporate name and seat (registered office) of the company, the objects of the business, the amount of share capital (Stammkapital) and share interests (Stammeinlagen) of the shareholders.
A GmbH has to be formed by one or more persons who may be individuals or legal entities, resident or non-resident, Austrian or foreign citizens.
The minimum share capital of a GmbH is €35,000. This must be subscribed in full on formation of the company, but only the highest amount of either €17,500 or 25% of the total share capital must be paid in before registration. The law does not provide for the issue of share certificates; shares in a GmbH cannot be traded on the stock exchange. Accordingly, a valid transfer of the ownership of shares is only possible by means of an assignment before a notary public.
A GmbH can have one or more managing directors. Directors may be of any nationality and may be non-residents of Austria. Corporate or Nominee directors are allowed. Managing Directors have complete authority to represent the company to the outside (as established by the conditions of their authority). The authority of managing directors is not tied to Austrian citizenship.
All Austrian companies must have their registered office in Austria.
The general meeting of the shareholders is the supreme decision-making body of the GmbH. The shareholders appoint the managing directors, remove them, determine their remuneration and conclude the employment contracts with them. Inter alia, the general meeting is responsible for the examination and determination of the annual accounts, the distribution of the balance sheet profit, the discharge of the managing directors as well as the supervisory board, if existing. The shareholders may deal with all affairs of the company and issue instructions to the managing directors regarding the management of the business of the company. Certain matters are expressly reserved for the general meeting.
The general meeting has to be held at least once a year within the first eight months of the fiscal year for the purpose of examination and determination of the annual accounts and distribution of the balance sheet profit as well as for the discharge of the management and of the supervisory board possibly existing. In addition, the general meeting is to be convened at any time by the managing directors, if this is required for the welfare of the company. Resolutions of the company may be adopted also in writing without a meeting (circular resolution) if all shareholders agree. Shareholders’ resolutions adopted are to be sent to each of the shareholders (as a copy) immediately.
Usually it is 7-14 working days.
RECURRING MAINTENANCE FEES AS FROM SECOND YEAR
- Provision of nominee director
- Provision of registered address