Different types of company present businesses with advantages as well as disadvantages, which is why it is particularly important during the start-up phase to think carefully when choosing the right corporate form.
GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: The formation of a company raises the question of which type of company is the most suitable. The law firm GRP Rainer Rechtsanwälte has a great deal of experience in the field of company law and offers advice when choosing the appropriate corporate form, as this can prove to be critical to the success of the business.
There are various types of company available under company law. These can vary considerably, especially in relation to registered capital, liability and taxation. Well-known corporate forms include, for instance, the GbR (Gesellschaft bürgerlichen Rechts) [civil law partnership], the GmbH (Gesellschaft mit beschränkter Haftung) [private limited company], the Aktiengesellschaft [stock corporation / public limited company] and the Kommanditgesellschaft [limited partnership], each of which entails different rights and obligations. Moreover, it is worth noting that the freedom of establishment means that businesses are no longer limited to national company forms; it is also possible to opt for foreign corporate forms, which may be better suited to the aims and opportunities associated with one’s business.
In order to be able to carefully weigh up the advantages and disadvantages, it is necessary to have extensive expertise both in national and international company law in addition to experience in choosing the right corporate form. Given that a number of legal fields always come into play and tax optimization is a significant factor, it makes sense to obtain comprehensive interdisciplinary legal advice that leads to a solution which is entirely in line with the wishes of the company’s founder.
After deciding on the corporate form, it is necessary to create the relevant structural framework and draw up agreements. In doing so, it is important to define the rights and obligations and set out the competences. The more detail in which the agreements are prepared, the less likely it is for legal disputes to potentially arise at a later date.
The choice of corporate form is equally significant if the intention is to establish the company abroad or foreign investors want to operate in Germany. If this is the case, the various national regulations and tax laws need to be observed to ensure that things are on the right track from the outset. Lawyers who are versed in national and international company law can advise on all of these issues and find the right solution.
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