How to set up a German "Mini" Gmbh?

Looking to Establish a "Mini" Gmbh ("mini "company with limited liability)? Your Essential Guide to Incorporation, Legalities, and Expanding in Germany.

The Mini GmbH is a kind of sub-form of the regular GmbH. The difference is the amount of the share capital. It amounts to at least one Euro for the Mini GmbH and at least 25,000 Euros for the "regular GmbH". 

Assets of any kind are not permitted in a Mini GmbH. The registration at the trade register can only be carried out when the share capital has been paid in full. The mini-GmbH is a legal body of its own. It must therefore settle all its liabilities from its corporate capital. This form of liability is very important for many shareholders since the fear of personal liability often acts as a deterrent to investment. It must sign with the suffix GmbH (UG) (liability limited) so that possible business partners are made aware of the limited liability.

The legislator has regulated the reserves of Mini GmbH in that it must retain a quarter of its gained profit per year. In this way, the amount of the share capital of the regular GmbH (Euro 25,000) can be reached. When the amount of Euro 25,000 is reached, the "legal form (liability restricted)" can be converted into a regular German GmbH.

When incorporating a Mini GmbH with at most three shareholders a sample protocol can be used. This contains the statutes, the shareholder list, and the managing director’s order and must be certified by a notarized solicitor.

• The UG is a new type of the German GmbH (Limited)
• protects the shareholder from personal liability
• Requires a capital stock of only one Euro
• Signs with the addition "business incorporation" (liability restricted - UG )
• retains a quarter of the annual surplus in the books upon an amount of 25.000 Euro
• can be converted to a regular GmbH, as soon as the capital stock of 25.000 Euro has been reached