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Doing Business in Austria
 
 
 
 
 

Forms of Business Organisation

The most common corporate forms are the Aktiengesellschaft (AG – joint stock company) and the Gesellschaft mit beschraenkter Haftung (GmbH – limited liability company). The main advantages of a GmbH over an AG are that minimum capital requirements are lower, managers can be replaced more easily, shareholders have more power over managers, voting rights can be freely regulated and publication of annual business reports is not mandatory for smaller firms. Other forms include the Offene Handelsgesellschaft (OHG – general partnership) and various forms of the Kommanditgesellschaft (KG – limited partnership).

The Societas Europaea or SE company form is also available. The SE is designed to enable companies to operate across the EU with a single legal structure, to facilitate mergers and create flexibility for companies wanting to move their head office from one EU state to another.

The requirements for the AG and the GmbH are:

Capital

AG: Minimum, €70,000; minimum face value per share €1; no-par-value shares permitted. A company may be formed immediately (entire capital paid in by founders) or—less commonly—in two stages, when an initial public offering (IPO) is planned. In such a case, founders subscribe to a limited number of shares and the remainder form part of the IPO.

GmbH: Minimum €35,000, with a minimum share value of €70 and one share per shareholder. Minimum of €17,500 in cash must be paid in on incorporation. Each shareholder must pay up at least €70 and at least one-quarter of their holding, whichever is higher. Different rules apply if contributions are in kind. Contributions in kind must be set forth in the articles of association. Insurance companies may not use the GmbH form and banks need special permission.

Founders and Shareholders

AG: Minimum of one founding shareholder. No nationality or residence requirements.

GmbH: Minimum of one founding shareholder. No nationality or residence requirements.

Supervisory Board

AG: Minimum of three members; maximum of 20. The board must meet at least four times a year. Directors may not sit on the management board or be employees of the company. For companies with more than five employees, a works council is compulsory; in companies with a works council, one-third of the board members must be works council representatives.

GmbH: Mandatory only for companies with registered capital in excess of €70,000 and more than 50 shareholders, or that alone or through subsidiaries employ more than 300 people. Otherwise, appointment of a supervisory board is voluntary. Minimum of three members, who must be individuals but need not be Austrian citizens or residents. The supervisory board must meet at least four times a year. Appointment rights to works councils are the same as for an AG.

Management

AG: Must have a management board with a different membership from that of the supervisory board.

GmbH: Directors may not sit on the supervisory board. No residence or nationality requirements apply in either case.

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