Limited Liability Company under German Law (the GmbH) (eBook)

Preface 5

I. Introduction 7

II. Company formation: establishing a new GmbH 11
A. Pre- registration phases 11
B. Formation by contributions 13
C. Articles of association 16
D. Filing for registration 25
E. Unternehmerg esellschaft (haftungsbe schränkt) 29

III. Acquisition of a shelf company 33

IV. Shareholders 37
A. Shareholder rights 37
B. Shareholder obligations 51
C. Liability of shareholders towards third parties (piercing the corporate veil) 56

V. Shareholders’ meeting 61
A. Statutory rights and obligations; transferral of rights and powers 61
B. Calling of shareholders’ meetings 64
C. Passing of resolutions 70
D. Defective shareholders’ resolutions 76

VI. Managing directors 85
A. Appointment and removal of managing directors 85
B. Rights and obligations 94
C. Liability 106

VII. Supervisory board 119
A. Optional supervisory board 120
B. Mandatory supervisory board under the One Third Employee Participation Act 134
C. Mandatory supervisory board under the Co-Determination Act 140
D. Mandatory supervisory board under the Co- Determination Act for the Coal and Steel Industry 146
E. Mandatory supervisory board under the Capital Investment Act 146

VIII. Share capital 149
A. Payment of share capital 149
B. Disguised contributions in kind 155
C. Maintenance of share capital 161
D. Loans 165
E. Additional contributions 170
F. Changes in terms of share capital 172

IX. Changes in shareholding and related transactions 179
A. Transfer of shares by agreement 179
B. Forfeiture (Kaduzierung) of shares 187
C. Redemption (Einziehung) of shares 188
D. Exclusion of shareholders 193
E. Termination of a shareholding by a shareholder 194
F. Transfer by way of succession 195
G. Pledging (Verpfändung) of shares 196
H. Beneficial interest (Nießbrauch) in shares 197

X. Financial statements and distribution of profits 199
A. Financial statements 199
B. Distribution of profits 203

XI. Company transformations 207
A. Merger 207
B. Company splitting 218
C. Conversion 227
D. Tax issues relating to reorganisations 234

XII. Taxes 237

XIII. Group relationships 249
A. Group relationships based on contract 249
B. Relationships not based on agreement 260

XIV. Liquidation 265

XV. Insolvency 271

XVI. GmbH & Co. KG 287
A. Overview 287
B. General rules pertaining to a GmbH & Co. KG 291
C. Publikumsgesellschaft (publicly owned company) 298

About the authors 301

About Globe Law and Business 303