Einkahlutafélögum

Einkahlutafélögum, often abbreviated as ehf., are a common type of limited liability company in Iceland. The name translates to "private limited company." This legal structure is popular for businesses of all sizes, from small startups to larger enterprises.

The key characteristic of an einkahlutafélag is that the liability of the owners, known as shareholders, is limited to the amount of capital they have invested in the company. This means that if the company incurs debts or faces legal claims, the personal assets of the shareholders are generally protected.

Establishing an einkahlutafélag requires a minimum share capital, which is set by law. The company is managed by a board of directors and may have an auditor, depending on its size and revenue. Ehref. must adhere to Icelandic company law, including requirements for financial reporting and annual general meetings.

The legal framework governing einkahlutafélögum is designed to provide a clear and secure structure for conducting business while offering limited liability protection to its owners. This structure fosters investment and encourages entrepreneurial activity within the Icelandic economy.