Procedures for setting up a company in Austria

Austria, a beautiful and prosperous country located in the heart of Europe, has long been known for its thriving economy and political stability and a friendly business environment. With its strategic geographical location, modern infrastructure and highly qualified workforce, Austria attracts a large number of international investors and businesses who wish to expand their operations or start new business ventures. Setting up a company in Austria not only opens up access to the vast market of the European Union, but also takes advantage of the country’s significant competitive advantages. However, like any legal procedure, setting up a company in Austria also requires thorough preparation, an understanding of the applicable legal regulations, and strict adherence to administrative procedures. This process includes many different steps, Viet An Law would like to guide clients through the procedure for establishing a company in Austria through the article below.

Preparation of information for setting up a company in Austria

Choosing a company type

• Define business goals and scale: The first and most important step is to clearly define your business goals, expected scale of operations, and the level of responsibility you want. Do you want a small, flexible company or a large business with high capital raising capacity?
• Research the types of formations: Thoroughly study the common types of companies in Austria, including Limited Liability Companies (GmbH), Joint Stock Companies (AG), Private Enterprises (Einzelunternehmen), and partnerships (OG, KG). Each type has different characteristics, capital requirements, responsibilities and procedures for establishment.

Choosing a company name

Customers choose a company name that is unique, easy to remember and should be suitable for your business field to name it. The company name needs to comply with Austrian naming regulations. For example, the name must include the legal type of the company (e.g., GmbH). Once you’ve chosen a name, you can check its availability through the Austrian Business Registry (Firmenbuch) to make sure it’s not already in use.

Choosing a company registration address

You need to have a valid business registration address in Austria. This is the official address of the company and will be used for official communications with government agencies. You can use your office address, or if you don’t already have one, you can use a virtual office service or the address of a legal representative.

Drafting of the company’s articles of association for setting up a company in Austria

The company’s charter (in the case of type GmbH) or charter (Satzung) (in case of type AG) is the most important and fundamental document of an enterprise. It serves as an internal constitution, which stipulates the rules, powers, obligations, and structure of the company’s operations. Careful and accurate drafting of the charter is extremely important to ensure clarity, transparency and compliance with the law. The main contents to be included in the company’s charter include:

• The company’s registered name and address;
• Business Purpose: A clear and specific description of the business activities that the company intends to undertake.
• Charter capital (note the minimum capital to establish a company);
• Management structure (depending on type):
  • Board of Directors (Geschäftsführer/Vorstand): Regulations on the appointment, powers, responsibilities and deadlines of the executives (in GmbH) or the board of directors (in AG).
  • Board of Directors (Aufsichtsrat) (if any): For large joint-stock companies, the charter will regulate the establishment, structure, powers and responsibilities of the board of directors.
• Rights and obligations of members/shareholders;
• Other regulations such as operating hours, dissolution process, special provisions

Notarization of the Charter

According to Austrian law, the company’s charter must be notarized by a competent notary in Austria. The notary will confirm the legality and authenticity of the document.

Deposit capital when setting up a company in Austria

After the company’s charter has been drafted and before filing the formal application for registration, the next step is to deposit the charter capital in accordance with Austrian law.

Charter capital deposit requirements and processes

• Determination of the capital level to be deposited:
  • GmbH (Limited Liability Company): For the establishment of a GmbH, you need to deposit a minimum charter capital of €35,000.
  • AG (Joint Stock Company): For the formation of an AG, the minimum charter capital is higher, which is €70,000.
  • Note: This is the statutory minimum capital. Founders can decide to contribute a higher amount of capital if it fits their business plan.
• Open a bank account in Austria: You need to open a bank account at a bank in Austria for deposit of charter capital. This account will be used exclusively for the purpose of the newly established company.
• Conduct charter capital contribution: Charter capital can be contributed in cash or in non-cash assets (e.g., fixed assets). However, for the initial contribution, Austrian law requires a certain percentage to be cash as follows:
  • For GmbH: At least €17,500 (i.e. half of the minimum charter capital) must be contributed in cash at the time of registration. The rest can be non-cash assets.
  • For AGs: At least €35,000 (i.e. half of the minimum charter capital) must be contributed in cash at the time of registration. The rest can be non-cash assets.
• Receive a deposit confirmation: After you have deposited the charter capital into your bank account, the bank will provide you with a certificate or a similar document. This confirmation is official proof that you have met the charter capital requirement and will be filed with the registration dossier at the Commercial Court.

Filing documents for setting up a company in Austria

After completing the preparatory steps, including the drafting of the charter and the deposit of charter capital, the next step is to officially register the company with the competent Commercial Court (Handelsgericht).

Registration process at the commercial court

• Preparation of Application Documents: You need to gather all the necessary documents to submit to the Commercial Court. These documents include:
  • Company Charter (Gesellschaftsvertrag/Satzung): The original or notarized copy of the company’s charter that has been drafted and notarized earlier.
  • Deposit Confirmation: A bank document that the charter capital has been deposited into the company’s account.
  • Information about members/shareholders: Including names, addresses, dates of birth, and other identifying information of members or shareholders.
  • Information about the chief executive officer (Geschäftsführer/Vorstand): Name, address, date of birth, and other identifying information of the person appointed as the chief executive officer or board of directors.
  • Registered address: Documents proving that the company has a valid registered address in Austria (e.g., an office lease).
  • Other documents (if applicable): Depending on the type of company and business activities, other documents such as sub-licenses may be required (if requested).

If the dossier fully meets the legal requirements, the Commercial Court will issue a decision approving the company registration. After approval, the information about the company will be recorded in the Austrian Register of Trade (Firmenbuch).