Founding of a Flexible Company

About the author: Stefan Gutbrunner, lawyer for CHG Czernich Rechtsanwälte in Vienna. The law firm advises SMEs and startups in the fields of business and corporate law, M&A, private equity, venture capital and new technologies, amongst other areas.

1 The articles of association of the FlexCo

When it comes to the founding of a flexible company (Flexible Kapitalgesellschaft, hereafter: FlexCo), the first step is formulating the memorandum of association (Gesellschaftsvertrag) and decision-making about its main contents. The structuring of shares in the company as well as company value shares (Unternehmenswertanteile) pursuant to the stipulations of the Austrian Flexible Company Act (FlexKapGG) is of particular importance.  

In this phase, the necessary supporting documents are also prepared. These documents include the application to be entered into the Commercial Register (Firmenbuch), which is brought to the responsible court to register the company, the shareholder resolution on the appointment of the managing directors as well as the specimen signatures of the managing directors.

2. Syndicate agreement

Further provisions of crucial relevance to shareholders may also be adopted in addition to the stipulations contained in the memorandum of association. In this regard, the syndicate agreement (Syndikatsvertrag) has become firmly established in practice. In contrast to the memorandum of association, the syndicate agreement is not publicly accessible, which is why a discrete regulation of shareholder rights and obligations is possible.

3. Founding

To ensure its legally taking effect, the completion of the articles of association as the basis for establishing a FlexCo requires a notarial deed (Notariatsakt). The possibility of an online founding of the FlexCo offers a substantial improvement in coordinating appointments between the shareholders and the managing directors. This option is regularly offered by us in cooperation with several selected notaries for establishing a limited liability compay (GmbH) and should also comprise an option facilitating the founding process for the FlexCo as well.

As a rule, the signing of the memorandum of association takes place within the context of a joint meeting, either in the offices of our law firm or online. All the parties involved as well as the notary are invited. After the signing of the memorandum of association, the appointment of the first managing director of the company is carried out by means of a notarially certified shareholder resolution.

The appointed managing directors also submit their notarised specimen signatures. At the same time, the application for entry into the Commercial Register is signed by all managing directors and notarised.If a syndicate agreement requiring a notarial deed exists, this can also be concluded at the same time.

The opening of a bank account and payment of the capital contribution (Stammeinlagen) are required to establish a FlexCo. The amount of the capital contribution to be paid in is oriented to the stipulations of the memorandum of association. The signed memorandum of association must be presented when opening a bank account. As a rule, a (digital) copy suffices.

The capital contribution is paid in after the account is opened. After this amount is paid in, the bank issues the so-called Section 10 confirmation, which is a mandatory requirement for the application of the company for entry in the Commercial Register.  For this reason, as soon as you obtain this confirmation, please forward it to us as soon as possible. Otherwise, you can also instruct the bank to contact us directly.

Application for entry into the Commercial Register, which is needed to register the FlexCo in the Commercial Register, is signed and certified on the date of the company’s foundation. As soon as the bank’s confirmation is available, we issue, on your behalf, the application for entry into the Commercial Register to the responsible Commercial Court (Firmenbuchgericht). The actual entry into the Commercial Register marks the formal birth of the FlexCo. The registration decision and an up-to-date extract from the Commercial Register (Firmenbuchauszug) are digitally transmitted, whereas the original documents are subsequently sent to you by mail.