The UG in Germany - a success story

The Unternehmergesellschaft (haftungsbeschränkt), or UG (haftungsbeschränkt) for short, has existed in Germany since 2008. As a variant of the classic GmbH, it can offer entrepreneurs considerable advantages and is therefore very popular.

The entrepreneurial company form was created as a counterpart to the British "Limited", which only requires share capital of one pound. Accordingly, a UG can be founded with only one euro of share capital. Formally, the UG is subject to GmbH law, which is why it is also known colloquially as a "1-euro GmbH" or "mini GmbH". As with a GmbH, liability is limited to the company's assets, so shareholders are not liable for debts with their private assets.

Founding a UG: who this type of company is suitable for

With the creation of the UG, the legislator has lowered the hurdles for setting up a company; after all, EUR 25,000 share capital is required for the company formation of a GmbH. The UG is therefore particularly suitable for start-ups and one-person companies that cannot raise this amount but still prefer a high level of liability protection for their company. company formation is also relatively simple, quick to implement and inexpensive. These advantages have made it a real success story: In 2018, around 10 years after its introduction, there were over 140,000 registered UGs in Germany(source: University of Jena).

In our article The company formation of a UG (haftungsbeschränkt) - advantages and disadvantages you will find detailed information about the possibilities and restrictions of this type of company.

How does the UG company formation work?

If a decision is then made in favor of this form of company, taking all the facts into account, the procedure for a successful company formation is relatively fixed. The procedure is usually as follows:

• Draw up articles of association (or sample minutes)
• Notarization of the articles of association
• Open a company account, pay in the share capital and submit the certificate to the notary
• Notification to the commercial register by the notary
• Business registration
• Registration with IHK or HWK
• Tax registration with the tax office

With Recht24-7 you can set up your UG online. We prepare all the necessary documents for you, send you the contracts and arrange notary appointments at your desired location.

Conclusion: The UG (haftungsbeschränkt) is a good alternative to the classic GmbH, which can make it easier for start-ups and sole traders in particular to set up their own company without major liability risks.

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