Aktiengesellschaft

An Aktiengesellschaft (AG) is a form of corporate entity used in several German-speaking countries, including Germany, Austria, and Switzerland. It is a capital-based company in which the business is funded by capital divided into shares. Shareholders’ liability is limited to their contributed capital, and the company has legal personhood separate from its owners.

Formation and capital: An AG is formed by founders and requires registration in the relevant commercial register. In many jurisdictions an Aktiengesellschaft must meet a minimum share capital requirement (for example, Germany requires at least 50,000 euros). Shares may be offered publicly or held privately.

Ownership and shares: Ownership is represented by shares that are generally transferable, subject to statutory rules and the company's articles. Publicly listed AGs can trade on stock exchanges; private AGs may restrict transfer as provided by their articles or shareholder agreements. The equity pool provides protection for creditors and determines the distribution of profits.

Governance: Governance typically features a board that manages day-to-day operations and, in many countries, a separate supervisory body elected by shareholders to oversee management. The general meeting of shareholders decides on fundamental issues, approves annual accounts, and appoints or elects members of the supervisory body. The exact structure varies by country, with some jurisdictions using a one-tier board system instead.

Regulation and scope: Publicly traded AGs are subject to securities law, accounting standards, and corporate governance codes; audits are common. The AG is a common form for larger corporations due to its ability to raise capital, facilitate transfer of ownership, and attract investors, while offering limited liability to its shareholders.