INCORPORATION

GERMANY PUBLIC LIMITED COMPANY (PLC., CORP.), LIMITED LIABILITY COMPANY (LLC., LTD.)

See also: LCG Germany special website

Company formation in Germany, the Public Limited Company (PLC., Corp.): legal and tax aspects

Company type: Public Limited Company (PLC., Corp.)
Name: Can be freely chosen with certain restrictions; the name must be authorised by the Chamber of Industry and Commerce, and must end in "AG".
Capital: Minimum capital of 50 000 €, one quarter of which must be paid in.
Shares: Bearer or registered shares.
Shares index: Yes, for registered shares.
Registered agent requirement: No
Registered headquarters: Yes
Entry in the public register: Yes, commercial register.
Shareholders: 1 shareholder (so-called small public limited company) or several shareholders, be they foreign, natural or legal persons.
Directors: At least 1 management board member and, additionally, at least 3 supervisory board members.
Incorporation period: 6-8 weeks (shelf companies are common)
Disclosure of beneficial owner: No
Disclosure of shareholders: Founding shareholders are entered in the commercial register. Anonymity can be safeguarded by using nominees.
Disclosure of directors: Yes
Trading restrictions: No; however certain activities require authorisation.
Taxation: Turnover tax: 7-19 %
15% corporate tax
Capital gains tax
Trade tax varies according to municipality
Solidarity surcharge
State tax charges: No
Double taxation agreements: Yes
Financial statements: Yes
Tax returns: Yes
Accounting: Yes
Annual reports: Yes
Formation costs: 6 000 € (minimum capital 50 000 €)
7 800 € shelf company (minimum capital 50 000 €)
Annual running costs: 6 700 € (minimum) - 9 900 € (full service)

Company formation in Germany, the Limited Liability Company (LLC., Ltd.): legal and tax aspects

Company type: Limited Liability Company (LLC., Ltd.)
Name: Can be freely chosen with certain restrictions; the name must be authorised by the Chamber of Industry and Commerce, and must end in "GmbH".
Capital: Minimum capital of 25,000 €, one quarter of which must be paid in (at least 12,500 €). The mininum amount of capital is due to be reduced to 10,000 € in 2006.
Shares: No shares, only company stakes.
Shares index: Partners are entered in the commercial register.
Registered agent requirement: No
Registered headquarters: Yes
Entry in the public register: Yes, commercial register.
Shareholders: Partners: no minimum (one-man company is allowed), nationals or foreigners, natural or legal persons.
Directors: At least 1 chief executive
Incorporation period: 6-8 weeks (shelf companies are common)
Disclosure of beneficial owner: No
Disclosure of shareholders: All partners must be entered in the commercial register. Anonymity can be safeguarded by using nominees.
Disclosure of directors: Yes
Trading restrictions: No; however certain activities require authorisation.
Taxation: Turnover tax: 7-19 %
15% corporate tax
Capital gains tax
Trade tax varies according to municipality
Solidarity surcharge
State tax charges: No
Double taxation agreements: Yes
Financial statements: Yes
Tax returns: Yes
Accounting: Yes
Annual reports: Yes
Formation costs: 3 900 € (minimum capital 25 000 €)
4 900 € shelf company (minimum capital 25 000 €)
Annual running costs: 3 700 € (minimum) - 8 700 € (full service)

General Information

Area: 357 021 sq km
Capital: Berlin
GDP per capita: 26 388 €
Unemployment Rate: 11,6%
Population: 82 501 000
Language: German
Currency: Euro
Rate of Inflation: 1,1%
Political Risks: None
Communications: Good
Residence Permit: Not a problem for EU citizens. All others require a visa.
Legal System: German Civil Code and German Commercial Code of January 1, 1900 (based on Roman Law)
Exchange Control: No
Patent Law: Yes
Tax Information Exchange Agreement: Yes
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