An Austrian AG — Aktiengesellschaft — is a stock corporation governed by the Aktiengesetz and registered in the Firmenbuch. It needs EUR 70,000 of Grundkapital with at least a quarter, EUR 17,500, paid in cash at founding; it must have a supervisory board of at least three natural persons; its shares transfer without a notarial deed; and its minimum corporate income tax is EUR 3,500 a year against a GmbH's EUR 500. The provision that decides whether you want one is § 70 Abs 1 AktG: the management board runs the company under its own responsibility, and the shareholders cannot instruct it.
What an Austrian AG Is
The Austrian AG is the second of the two Kapitalgesellschaften, and almost every difference from the GmbH is a statutory one rather than a matter of scale. The table sets the two side by side because that is how the choice is actually made.
| AG | GmbH | |
|---|---|---|
| Minimum capital | EUR 70,000 | EUR 10,000 |
| Cash required before or at founding | A quarter, minimum EUR 17,500 | At least EUR 5,000 paid in |
| Managing body | Management board, acting on its own responsibility | Managing directors, bound by shareholder resolutions |
| Supervisory board | Always — three to 20 natural persons | Only above the § 29 thresholds |
| Transfer of shares | No deed requirement | Notarial deed required |
| Minimum corporate income tax | EUR 3,500 a year | EUR 500 a year |
| Corporate income tax rate | 23 per cent for both | |
| Annual accounts | Drawn up within five months, filed within nine, publicly inspectable — both forms | |
The minimum corporate income tax deserves a second look because it is the line that bites a company with no profit. It is five per cent of each form's minimum capital — EUR 3,500 for an AG, EUR 500 for a GmbH or FlexKapG — payable quarterly, in a loss-making year as much as a profitable one. An AG that never trades still owes seven times what a dormant GmbH owes.
The Board Cannot Be Instructed
The Aktiengesetz and the GmbH-Gesetz answer the same question in opposite directions, and reading the two provisions side by side makes the design intent obvious.
§ 70 Abs 1 AktG: the management board manages the company under its own responsibility, as the good of the undertaking requires, having regard to the interests of shareholders and employees and to the public interest. § 20 Abs 1 GmbHG: managing directors are obliged towards the company to observe every restriction placed on their authority by the articles, by shareholder resolution, or by a binding instruction of the supervisory board.
So the GmbH is built for owners who run their own company — instructions flow from the shareholders' meeting to the directors, and a director who ignores them is in breach towards the company. The AG is built for a company whose owners are not its managers: the board's mandate comes from the statute, and the shareholders' lever is the supervisory board they elect and the resolutions the Act reserves to them.
One qualification matters commercially, and it cuts against the GmbH. Under § 20 Abs 2 GmbHG, restrictions on a managing director's authority have no legal effect against third parties. A GmbH director who signs a contract the shareholders forbade still binds the company. The GmbH's control mechanism protects the owners against their director; it does not protect them against the deal.
Organs and Who May Sit on Them
An AG has three organs — a management board, a supervisory board and a general meeting — and the middle one is not optional. § 86 Abs 1 AktG sets the supervisory board at three natural persons, with the articles free to go up to 20. The Act also disqualifies candidates who already hold ten supervisory-board seats in Austrian capital companies, a chairmanship counting double, and those who are the legal representative of a subsidiary of the company.
Practically, that is three more people who must be found, agree to serve, meet, minute their meetings and usually be paid. It is the recurring cost of an AG that the capital comparison never shows, and it is the reason the form is rare below a certain size.
A GmbH, by contrast, has managing directors and a shareholders' meeting. A supervisory board appears only where § 29 Abs 1 GmbHG is triggered: share capital over EUR 70,000 and more than 50 shareholders — both limbs, cumulatively — or an average of more than 300 employees, or heading a qualifying group. A EUR 1,000,000 GmbH with three shareholders is not caught.
Shares Move Without a Notary
AG shares carry no formality requirement on transfer, and that is the whole point of the form. The contrast is § 76 GmbHG, which makes GmbH shares transferable and inheritable and then requires a notarial deed for any transfer between living persons — and the same form for any agreement obliging a shareholder to transfer a share in future. That last limb is broader than it looks: option agreements, pre-emption promises, drag and tag arrangements and most founder side-letters fall inside it. A pledge over a GmbH share, by contrast, needs no deed at all.
This is why a shelf-company purchase runs through a notary rather than a signed contract, and it is the reason the GmbH is a poor vehicle where shares are meant to circulate. An investor expecting to sell in three years, an employee scheme with real share issuance, an eventual listing — all of them are obstructed by § 76 Abs 2.
The GmbH's formality has a quiet upside for a closely held business, and it is worth stating because it is the reason most Austrian companies stay GmbHs. Every change of ownership passes a notary and lands in the Firmenbuch, so the cap table cannot be shuffled behind the founders' backs. Whether that is friction or protection depends entirely on which side of the table you sit.
When an AG Is the Wrong Answer
The AG is the default in almost no case, and the honest version of this page says so. Three situations justify it; outside them the GmbH is the right form for good reasons.
Shares need to move without a notary every time. This is the strongest reason and usually the only one that survives scrutiny.
Separating ownership from management is the point. Where shareholders genuinely should not be able to instruct management — a family holding with outside operators, a company with regulatory expectations about governance — § 70 Abs 1 AktG is the feature rather than the cost.
A counterparty requires it. Certain regulated activities and certain contractual counterparties expect the AG's governance apparatus. That is a requirement to be verified rather than assumed; ask which provision imposes it before raising EUR 70,000.
If the reason you are looking at an AG is employee participation without diluting control, look at the FlexKapG first. It has been available since 1 January 2024, needs the same EUR 10,000 as a GmbH, and its non-voting enterprise-value shares — capped at 24.99 per cent of capital — were designed for precisely that problem. Choosing an AG for a cap-table reason that the FlexKapG already solves is the most common way this decision is got wrong.
Converting Between the Two
Conversion between AG and GmbH exists in Austrian law and is a shareholder decision executed by notarial deed and registered in the Firmenbuch. It is not a paper exercise: converting a GmbH into an AG means raising capital to EUR 70,000, appointing a supervisory board of at least three, and giving up the right to instruct management. Going the other way means unwinding the same apparatus.
Because both directions cost real money and real months, the practical advice is unromantic — start as a GmbH unless something specific and identifiable requires an AG today. Most companies that convert do so because an investor or a listing forced the question, not because they grew into it on their own.
Frequently Asked Questions
What is an AG in Austria?
An Aktiengesellschaft — a stock corporation governed by the Austrian Aktiengesetz and registered in the Firmenbuch. It is a Kapitalgesellschaft, so it has its own legal personality and its shareholders' liability is capped, but it differs from a GmbH in governance: its management board runs the company under its own responsibility under § 70(1) AktG, and shareholders exercise influence through the supervisory board they elect rather than by instructing management.
How much share capital does an Austrian AG need?
EUR 70,000 of Grundkapital, of which at least a quarter — a minimum of EUR 17,500 — must be paid in cash at founding. A GmbH by comparison needs EUR 10,000, with at least EUR 5,000 of cash contributions paid in before registration.
Does an Austrian AG have to have a supervisory board?
Yes, always. Section 86(1) AktG says the supervisory board consists of three natural persons, and the articles may set a higher number up to 20. A GmbH needs one only above the thresholds in section 29(1) GmbHG: share capital over EUR 70,000 and more than 50 shareholders, or more than 300 employees on average, or heading a qualifying group.
What is the difference between an AG and a GmbH in Austria?
Control. Section 20(1) GmbHG obliges a GmbH's managing directors to observe restrictions set by the articles, by shareholder resolution or by a binding supervisory-board instruction, so the owners direct the business. Section 70(1) AktG says an AG's management board runs the company under its own responsibility, weighing the interests of shareholders, employees and the public. Capital, minimum tax and the share-transfer formality all differ too, but the governance rule is the one that decides the form.
How much tax does an Austrian AG pay?
The same 23 per cent corporate income tax as a GmbH — the rate does not depend on the form. The minimum corporate income tax does: EUR 3,500 a year for an AG against EUR 500 for a GmbH or FlexKapG, payable quarterly whether or not the company earns anything. It is set at five per cent of each form's minimum capital, so a dormant AG owes seven times what a dormant GmbH owes.
Can a GmbH be converted into an AG?
Yes, Austrian law provides for conversion between the two forms, and it is a shareholder decision executed by notarial deed and registered in the Firmenbuch. It is not a formality: converting to an AG means raising the capital to EUR 70,000, appointing a supervisory board, and accepting that the management board can no longer be instructed. Most companies that convert do it because an investor or a listing requires it.