Doing business in Germany?
Thinking about doing business in Germany or in the EU? If so, you better also think about setting up a German company – ideally, one with a limited liability to save your personal assets!
There are several ways to start your business and to set up a company in Germany - finding a tailor-made solution will therefore mainly depend on your personal needs and plans.
However, there is quite a number of reasons to think about setting up a company with limited liability first - and safeguarding your personal assets is one of them.
You may have already heard about the German “GmbH”, this form of a limited liability company already existing for more than 100 years. But there also is the GmbH´s little sister, the “Unternehmergesellschaft (UG)” or, more simple, “Mini-GmbH”.
Both the GmbH and the “Mini-GmbH” allow you to engage in almost every business activity in Germany, no matter whether you are a start-up in the internet business or an established foreign company entering the German market for the first time. In cases where an additional approval is needed (as is, for example, the case in the field of financial services), this will equally apply for both, the GmbH and the “Mini-GmbH”.
So what are the differences between them? In principle, the UG is pretty similar to a GmbH except for the fact that the minimum share capital does not amount to 25,000 Euro but is 1 Euro only! Even so, it has to be kept in mind that the German legislator wants every UG to turn into a “real” GmbH over time by retaining parts of its revenues until the share capital has grown up to 25,000 Euro.
However, the ”Mini-GmbH” still provides a very good alternative to a Limited (Ltd.) under British or other law, especially when taking into account that its reputation as a company form on the German market is still flawless.
But in the end it is not just a “German Ltd”, and setting it up is not half an hour´s work only. Especially for shareholders from abroad there are some additional requirements to be met during the company´s incorporation, And it will cost more than the 20 € you may have heard will suffice to set up an Ltd. But then, you’ll get a generally accepted and well known company “made in Germany”!
Interested? Please learn more about the GmbH and mini-GmbH HERE !