Whoever wishes to incorporate a German limited liability company can rely on a Civil Law Notary to do so. The incorporation procedure goes through four phases: The drafting phase, the notarization phase, the payment phase and the application phase.
The Civil Law Notary will, with the concerned parties and future shareholders, discuss what the company will be called and where the company’s seat (corporate headquarters) will be located. He will further discuss the level of nominal capital and in what amounts or quantities the shareholders will, as well as determining the company’s mission statement or reason for being.
The Civil Law Notary will furthermore draft the provisions of the Articles of Association when required.
Subsequently, the Articles of Association will be notarized. Whilst the articles of association are notarized it is usual to appoint the company directors and procurist(s) (if applicable) and also to specify the scope of their powers and how they will be regulated.
After the declaration of the articles of association, the partners must deposit the share capital into the company account. The amount to be paid is determined in the Articles of Association. Before the company can be incorporated, at least half the nominal capital must be paid up. To protect the partner’s assets, the full amount of the share capital should be paid up as soon as possible.
The last phase is registration. Firstly, the managing director(s) and the company must be registered. They may only do this when the nominal capital has been deposited as stated in the Articles of Association. After this registration, the Civil Law Notary will submit the Articles of Association and the registration with the Commercial Register.
After the company’s incorporation, it will still be necessary for the Company Director to register the newly formed company at the Chamber of Commerce, any applicable industry regulating bodies (if applicable) as well as with the tax office. For these registrations the Civil Law Notary’s involvement is not required.
According to the KostO, the fee for the incorporation of a GmbH with a sharecapital of €25,000 (the minimum amount) should amount to €391, constituted by:
- The notarization of the company’s articles of association (a double fee pursuant to § 36 Abs. 2 KostO). €168.
- The notarization of the appointment of the company director (a double fee pursuant to § 47 2 KostO). €168.
- The drafting of the registration together with the certification of the signature (a half fee pursuant to §§ 145 Abs. 1, 38 Abs. 2 Nr. 7 KostO). €42.
The drawing up of the shareholders list (a half fee pursuant to § 147 Abs. 2 KostO). €13.
On top of these amounts prescribed by statute is also other miscellaneous costs such as postage and printing costs as well as V.A.T. chargeable at a rate of 19%.