A Liechtenstein company with limited liability (GmbH) is a company with its own legal personality which is made up of one or more company members. Due to the low capital requirements, the formation of a company with limited liability is particularly suited for small and medium-sized enterprises.
A sole proprietor in Liechtenstein can benefit from the fact that he/she can found a one-man company with limited liability (“Ein-Mann-GmbH” in German). In addition, the company with limited liability is an internationally recognised type of company and it offers the advantage of a liability limit, as only the company’s assets are available to meet the debts of the company. In this context, the liability of each participant is limited to a specific amount, unless otherwise provided in the articles of association.
Organisation
The general meeting of company members constitutes the supreme corporate body of the company, unless otherwise provided in the articles of association. It must be convened at least once a year. The business management and the representation of the company in its relations with third parties are the joint responsibility of the company members, unless otherwise provided in the articles of association. The tasks of business management and representation can also be delegated to one or more company members or to a third party by means of a company members’ resolution or specification to this effect in the articles of association. If the company with limited liability engages in a business run along commercial lines or if the non-managing company members are not assigned any supervisory capacity, an audit authority must be appointed. In addition, a legal representative (registered agent) must be appointed, unless a domestic address for service has been designated. The legal representative is the official address for service and the contact point for the authorities.
Purpose
The purpose of a Liechtenstein company with limited liability can be of an economic or non-economic nature and it must be lawful and reasonable and in line with good morals.
In any case, it must be evident from the provision on the purpose of the company with limited liability whether or not a business run along commercial lines is carried out.
Corporate name
The corporate name can be freely chosen, even made-up names and terms denoting an object are permissible, unless they contradict the main purpose. However, the unabbreviated addition “Gesellschaft mit beschränkter Haftung” or the abbreviation “GmbH” or “Ges.m.b.H” or, in the case of companies with limited liability which do not carry on a business run along commercial lines, the relevant foreign-language terms must be included. Even the use of personal names is permissible, if the bearer of the name concerned is a company member himself/herself.
Capital
The capital as laid down in the articles of association can be specified in Swiss francs, euros or US dollars. However, the minimum nominal capital must always be complied with. The minimum nominal capital is CHF 10,000.00, EUR 10,000.00 or USD 10,000.00. Therefore the nominal capital amounts to CHF 10,000.00, EUR 10,000.00 or USD 10,000.00 or any amount higher than that. The initial contribution of each company member which cannot be reclaimed must be at least CHF 50.00. The formation of the company can be in cash or in kind.
The minimum nominal capital must have been fully paid up or contributed upon the formation of the company. The capital is at the company’s free disposal, as soon as it has been entered in the commercial register.
Formation
A company with limited liability can be formed by one or more individuals, companies, or legal entities under civil or public law. However, the founding of a Liechtenstein company with limited liability requires only one founder. The formation must be in the form of a public deed. If a company with limited liability consists of no more than three company members and only one general manager, the company can be formed in simplified proceedings and no public deed will be required.
However, the Liechtenstein company with limited liability does not come into being until it has been entered in the commercial register.
Articles of association
The articles of association of a Liechtenstein company with limited liability must contain the legally required information or provisions. For the formation of a company with limited liability in simplified proceedings, the sample document made available by the Office of Justice electronically on its homepage (or in paper form at the Office of Justice) must be used. The sample document consists of the deed of formation and the articles of association and it must include the legally required content. In addition, the signatures of the founders on the articles of association (i.e. the signatures at the bottom of the sample document) must be certified.
Accounting and disclosure provisions
It must be noted that all Liechtenstein companies with limited liability, irrespective of whether or not they engage in a business run along commercial lines, are required to keep an orderly business accountancy. The legal representatives of the company with limited liability are under an obligation to file the duly approved annual accounts and the audit report with the Office of Justice no later than before the expiration of twelfth months after the balance sheet date.