A business owner not only has to consider economic aspects, but many other legal facets too. Capable advice is necessary if major errors are to be avoided, for instance, in the founding and running of a corporation as well as in the planning of corporate succession. Notaries public are reliable assistants as a result of their experience in the answering of questions that arise in this context .
OPTIMAL LEGAL FORM
The first question pertains to the optimal legal form. Many different factors have to be taken into consideration when making a selection. From a legal perspective, particularly important areas are aspects of corporate law, commercial accounting law and tax law. The question of liability is of key importance when selecting a legal form.
The notary public can help with the selection of a permissible company name and clarifying instances of doubt. The "Firm" is the name with which the corporation is registered in the commercial register and which is used in business transactions. The name selected must be suitable to identify the enterprise and to differentiate clearly it from other corporations. The firm’s name can also be a distinctive fantasy name that is not drawn from the subject of the business (e.g. "Paradiso GmbH" for a tanning studio). The name must always include a corresponding suffix that makes the legal form of the enterprise absolutely clear.
ENTRY IN THE COMMMERCIAL REGISTER
If certain company circumstances change that are of importance to the transaction of business, this must be recorded in the commercial register. For instance, subject to registration are:
- Change of management; issuance / revocation of commercial power of attorney,
- Change in the firm,
- Change in the firm’s headquarters; setting up of branch offices,
- Changes in partners in the case of OHGs (general partnerships) and KGs (limited partnerships and
- Changes in the articles of association for stock corporations.
The filing of data that has to be registered with the commercial register requires notarization. The notary public draws up the text of the registration and supervises its correct entry in the commercial register. The notary public also provides comprehensive advice about questions relating to the registration and clears up any instances of doubt with the registry court.
RESTRUCTURING AND SALE OF COMPANY SHARES
In a rapidly changing economic environment, measures such as the change to a different legal form, mergers and consolidations are ever more frequent events - even for small and medium-sized enterprises. Typical examples of such changes are the sale of company shares, changing the legal form of a firm and even company splits.
In fact, these are complicated legal transactions, which is why the legislator has provided for the assistance of a notary public in many cases.
If the need to work out a sensible succession plan is not recognized early enough, this can quickly lead to crisis. It also affects a lot of jobs. The primary objectives of the succession plan are maintenance of the business and provision for departing senior executives and/or their relatives. It is important to select suitable successors to own and run the business - if possible to bring them into the business during the active phase of the senior executive.
However, the business owner must not only think about the planned corporate succession. Instead, consideration should also be given to a case of sudden death. Precisely in this case, failure to put instructions in one’s will can mean the end for a young and upcoming firm.
In general, we would strongly discourage people wanting to regulate the succession without expert advice, for instance, with a last will and testament that they have drawn up themselves. For instance, such arrangements have to be reconciled with the rules laid down in the articles of association. Advising you about balanced testamentary provisions or contractual arrangements is one of the main tasks of a notary public.