DesignAgency.gr
18/01/2024
PLPG at “Your easy access to Austria” event
18/01/2024
The Austrian government has proposed a new corporate structure called “Flexible Kapitalgesellschaft” or the “Flexible Company” (FlexCo) to facilitate startup ventures, aiming to reduce the minimum required capital for all limited liability companies (GmbH) from 35,000 to 10,000 euros. This FlexCo is intended to provide advantages, especially in early-stage funding, over the existing GmbH structure.
Notably, the new FlexCo’s minimum capital requirements differ from a GmbH, allowing for lower contributions per shareholder, as low as one euro, fostering broader shareholder participation and cheaper ownership. Furthermore, it introduces the option to divide shares into units of at least one-euro nominal value, enabling varied ownership rights—a practice common in venture capital financing.
Additionally, the proposal aims to phase out the “founding-privileged” GmbH, which allowed reduced initial capital requirements but mandated an increase to the standard capital after ten years. This amendment renders the founding-privileged GmbH obsolete, with transitional provisions for existing entities.
Moreover, the FlexCo permits unequal voting rights for shareholders owning multiple shares, enabling diverse voting structures. This flexibility is expected to simplify trustee arrangements, allowing trustees to represent different investor interests more effectively.
The legislation also includes provisions for converting existing GmbHs to FlexCos, likely prompting many business owners to consider this transition. Although some startup sector demands, like the removal of notarial formalities, weren’t entirely met, the introduction of FlexCo signals a significant move to enhance the business landscape, potentially paving the way for further corporate law reforms.
