Setting up an Austrian GmbH: what has applied since 2024

The Company Law Amendment Act 2023 has noticeably changed the formation of an Austrian GmbH. New parameters apply to companies formed from 1 January 2024, and existing companies should review their articles of association as well.

The key figures

The minimum share capital is EUR 10,000, at least half of which must be paid in cash. The previously common founding-privileged GmbH has been abolished; it was replaced by the general reduction. Companies whose articles still refer to a founding privilege have reason to review them: the privilege no longer ends by lapse of time, but an amendment to the articles filed after 31 December 2024 is registered only if the provisions on the founding privilege are removed (§ 127 para 30 GmbHG); in addition, the wording frequently no longer matches the law in force.

The minimum corporate income tax, which is linked to the minimum share capital, was reduced accordingly.

New: the FlexCo

Since 2024 there has additionally been the Flexible Company (FlexKapG, or FlexCo). It is aimed primarily at start-ups and notably permits enterprise-value shares, a form of participation allowing employees to share in the value of the business without acquiring full shareholder rights. For companies planning financing rounds or employee participation this is an alternative to the classic GmbH; for a typical trade or retail business the GmbH remains the simpler route.

What takes time in a formation

What takes time is not the capital but the preparation:

• Company name. It must be distinctive and must not mislead (§ 18 UGB); the Chamber of Commerce gives an opinion in advance on request, and the Austrian companies register (Firmenbuch) court decides.
• Articles of association. Call rights, voting arrangements and exit provisions deserve particular care where there are several shareholders. Such clauses cost little at formation and a great deal in a dispute.
• Appointment of managing directors. It has to be settled who represents the company alone, who jointly and who, where relevant, meets the requirements under trade law.
• Trade licence. This must be considered separately from the formation; regulated trades require a certificate of competence or a managing director under trade law.

For existing companies

A review of the articles is called for in particular where they date from before 2024 and refer to the founding privilege, where employee participation is planned, or where the shareholder group has changed without the articles being updated.