Wolfgang Braza & Gregor Kaschowitz
by Wolfgang Braza & Gregor Kaschowitz
Objectives
The following article will present the Austrian Limited as a possible new corporate form under Austrian law. The Federal Ministry for Digitalisation and Economic Location commissioned an expert report from two Viennese law firms that drafted the key points for a new corporate form. In particular, the aim was to ensure an unbureaucratic foundation and a flexible allocation of shares.
Formation process
To reduce costs and accelerate the foundation process, the simple written form should be sufficient for all deeds and applications to the commercial register. The contents of the articles of association should not be subject to inspection by the commercial register court. As in the case of a public limited company (PLC), shareholders should not be entered in the commercial register, but instead a share register should be kept. In order to prevent abuse, qualified persons (e.g. lawyers) should check the identity (including the power of representation) of the partners during the formation process. A minimum nominal capital of EUR 5,000 was proposed, half of which would be paid in as part of the incorporation.
It should be possible to handle the entire foundation process digitally and in the English language to simplify things for international founders and investors.
Governing body of the company and resolutions by shareholders
There shall be only one management body and the shareholders' meeting, and the regulations for these shall be taken over from the Austrian Limited Liability Companies Act ("GmbHG"). As in the GmbHG, a supervisory board should only be mandatory if the threshold values are exceeded.
Shareholders' meetings should be held in the form of face-to-face and/or virtual meetings; hybrid meetings should also be possible. In general, no additional formal requirements should apply to resolutions. In particular, it should be possible to adopt resolutions by circulation using electronic signature programs or email.
Transfer, acquisition and sale of company shares
Just as in the case of a limited liability company, each shareholder should hold a share in the company. In order to enable more cost-effective and flexible share transfers, the shares should be divisible as a rule. Share assignments should be possible with a written agreement and without further formal requirements; electronic signature programs should satisfy the written form requirement. However, the usual contractual restrictions on transfer should be declared permissible.
Outlook
The draft legislation remains to be seen in order to be able to assess whether the intended goals will be achieved. While the response in the literature has been restrained so far, it will be exciting to see whether and, if so, how the realisation of this project will proceed.
GGI member firmKAPP & PARTNER Rechtsanwälte GmbHGraz-Seiersberg, AustriaT: +43 316 22 59 55
Law Firm Services
KAPP & PARTNER Rechtsanwälte GmbH has an outstanding reputation for bankruptcy and real estate law in Austria. The firm mainly focuses on bankruptcy, reorganisation, company restructuring, commercial and real estate law.
Wolfgang Braza is a scientific assistant at KAPP & PARTNER Rechtsanwälte GmbH, as well as research assistant at the Institute of Civil Procedure and Insolvency Law at the University of Graz. Contact Wolfgang.
Gregor Kaschowitz is Partner at KAPP & PARTNER Rechtsanwälte GmbH. He principally works in the field of corporate and company law, in particular reorganisations and structuring of group companies. Contact Gregor.
