Duties of the shareholder of a limited liability company
In the following article, the duties of the shareholder of a limited liability company (LLC) are shown and explained.
Distinction from the duties of the shareholder of a stock corporation
In addition to various similarities, there are also some differences between the stock corporation and the limited liability company (LLC). When looking at the legal position of the individual persons, it is noticeable that, apart from the duty to pay, i.e. the duty to pay the share capital, no further duties are imposed on the shareholders of a stock corporation by law. It is true that further obligations can be agreed within the framework of a shareholders’ agreement. However, these obligations exist solely at the level of private law and apply only between the parties to the shareholders’ agreement.
In contrast, shareholders of a LLC can already be required to comply with further obligations in the articles of association and thus at the level of corporate law.
The individual duties of the shareholders of a LLC
On the one hand, a partner as well as a shareholder has a duty to pay. This concerns the share in the capital stock of the LLC. Furthermore, in contrast to the shareholder, the partner has a duty of loyalty to his company. In terms of the articles of association, a non-competition clause going beyond this can even be stipulated (Art. 803 CO).
Furthermore, ancillary obligations can be included in the articles of association. Such ancillary obligations must serve the purpose of the company, the preservation of the independence of the company or the preservation of the composition of the circle of shareholders (Art. 796 CO). For the detailed description of the ancillary services, the shareholders’ meeting may issue regulations to which reference is made in the articles of association.
Finally, there is the possibility of obliging the partners to make additional contributions (Art. 795 CO). It can thus be agreed that an obligation to pay capital arises in the event of sluggish business. Art. 795a CO specifies the requirements for the entitlement of the managing director to demand additional contributions. The obligation to make additional contributions is an obligation towards the GmbH and does not constitute a liability towards third parties. However, the obligation to make additional contributions is not unlimited. Art. 795 para. 2 provides for a limitation of the obligation to make additional contributions of a maximum of twice the nominal value of the ordinary shares held by the shareholder.
