Articles of Association
The articles of association are the deed of foundation of a company, preferably described also as statute. Should a person found alone a limited liability company or a company limited by shares, the articles of association shall be replaced by the declaration of foundation. The articles of association regulate the legal relationship, on the one hand, between or among the members, however, on the other hand, also their rights and obligations vis-à-vis the company. In addition, contents and form of the articles of association depend always on the elected corporate form.
Articles of Association – General Partnerships (OG)
The articles of association of a general partnership (Offene Gesellschaft - OG) are not bound to a specific form. Accordingly, a general partnership may also be founded via an orally made contract, however, it has to be strongly advised against doing this on grounds of legal certainty. A written contract lays down the mutual rights and obligations of the partners who are all subjected to equal, unrestricted and personal liability, and entitled to business management and the representation of the partnership.
Articles of Association – Limited Partnerships (KG)
Like in the case of general partnerships the articles of association of a limited partnership (Kommanditgesellschaft - KG) do not require any definite form either. The contract should regulate, in addition to the basic details of the partnership, above all the liability of the limited partner, as well as the maximum amount of his or her liability and the supply of the limited partner’s deposit. Like in the case of all personal companies there are lots of further regulations to be reasonably inserted, regarding e.g. the withdrawal of partners from the partnership or the termination thereof by notice.
Articles of Association – Limited Liability Company (GmbH)
The foundation of a limited liability company (Gesellschaft mit beschränkter Haftung - GmbH) is bound to somewhat more formalities than the foundation of a personal company. The minimum contents of the articles of association are laid down by law for the GmbH. Also the form is regulated, so that the foundation of a GmbH requires always a notarial act, notwithstanding the number of the members participating in the company or the amount of the registered capital to be supplied for the company. In addition to the minimum contents there is a number of further regulations for the company which are possible and also applied in the practice, e.g. if it is about the transfer of a business quota or about transactions subject to permission.
Amendments to the articles of association of a limited liability company require similarly a notarial act. In difference from the personal companies the articles of association of an LLC must be, in addition, submitted to the Court of Registration and they can be inspected by everybody in the archives of the company register. Since all regulations of a company are not always meant for the public, it is often recommendable to formulate a syndicate agreement.
The Esztegar Law Office offers you consulting in the formulation of the articles of association and upon the amendments thereto or in the event of controversies between the members or with the company.