An Unternehmergesellschaft or a UG for short, is the little brother of the GmbH, The UG is also a limited liability company, just like his big brother, this business form having been introduced by the German law on the 1st of November, 2008, in order to increase competitiveness.
We recommend the establishment of a UG to all who do not have at their disposal the EUR 25,000,- required to set up german GmbH, yet desire to enter the German market with a limited liability company. An Unternehmergesellschaft has the same rights as the GmbH, being also subject to the same rules, only the minimum share capital was reduced to EUR 1,-.
Although corporate law allows a EUR 1,- capital contribution, it is not recommended to start a company with this minimum amount, since banks will not open a bank account for a company whose manager wants to deposit EUR 1,- in the bank account, that is why we recommend paying in a minimum capital of EUR 1,000-.
As does the GmbH´s, the founding of the UG also begins with the signing of notarial documents.
Any natural person or legal entity may establish a UG, yet its manager must be a private individual.
The founders of the company will have to sign the following documents before the notary:
- Articles of association
- Specimen signature
- General manager´s statement
The articles of association must include the name of the company, its address, the personal data of the members and of the managers, the appropriate distribution of the capital contribution, as well as the company´s business activity areas.
The specimen signature must be carried out by the general manager of the company, whereas this signature will have to appear on documents such as bank instruments, agreements etc..
Within the general manager´s statement the leader of the company declares their impunity, also stating that they comply with the requirements of the German law for the performance of their executive duties.
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Mini GmbH incorporation in Germany
Although an Unternehmergesellschaft can be set up for just EUR 1-, yet, under the current legal provisions, this type of company should be transformed into a GmbH within 5 financial years and during this time the company must also reach a share capital value of EUR 25,000-.