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The Articles of AssociationThe Articles of Association can be phrased in different ways depending on the degree offlexibility desired by the shareholders. Therefore, the Articles of Association may be formulatedrather short only setting out mandatory provisions such as name, registered office,duration, registered share capital, purpose, initial contributions of the shareholders,representation and management of the corporation. Nevertheless, the Articles of Associationcan as well be a detailed description of the shareholder’s rights and obligations,classes of shares and restriction on the transfer of sharesRegistered Share CapitalThe minimum share capital for a GmbH is 25.000 Euro.A GmbH is not obliged to issue share certificates or to keep formal records of share ownership.Instead of that, the ownership of each share is recorded only in the corporationdeed. However, later transfers of share will be documented in transfer deeds attested bya notary. After each of those transfers of shares an up-dated shareholders’ list must besubmitted to the Commercial Register by the Managing Directors. Nevertheless thoselists have mainly an informational function and do not provide evidence of the ownershipof shares.(1) How to transfer sharesThe transfer of shares requires a notarized transfer deed. In addition to that, prior consentof the company is needed if only a part of a share shall be transferred. However, theArticles of Association may provide additional requirements which also have to be met bythe transfer action (such as the consent of other shareholders).(2) ContributionThe contribution to the share can be in cash as well as in kind.In the event of the contribution being in kind, the Articles of Association must provide aspecific form of the contribution and the exact amount of the corresponding share capital.The contribution must be worth at least as much as the above-mentioned correspondingshare capital. Otherwise the shareholder is obliged to pay the respective difference incash. Furthermore, the shareholders must hand in a report on the valuation of the contributionin kind. If the contribution in kind is another business, the financial results of thelast two years have to be submitted too.13