Aktiengesellschaft
Encyclopedia
Aktiengesellschaft (ˈaktsiənɡəzɛlʃaft; abbreviated AG) is a German
term that refers to a corporation
that is limited by share
s, i.e. owned by shareholder
s, and may be traded on a stock market
. The term is used in Germany
, Austria
and Switzerland
. It is also used occasionally in Luxembourg
(though the French-language equivalent Société Anonyme is more common) and for companies incorporated in the German speaking region of Belgium
.
word Aktiengesellschaft is a compound noun made up of two elements: Aktien meaning shares, and Gesellschaft meaning society, or, in this context, company. Other types of German companies also have shares, although these shares are called Anteile rather than Aktien. A similar distinction exists in other languages; for example, in Polish
the two types of share are called akcja and udział, or in Spanish
, acción and cuota.
, all German (required by § 4 Aktiengesetz) and Austrian stock corporations include Aktiengesellschaft or AG as part of their name, frequently as a suffix.
(Società per Azioni, S.p.A.), Denmark
(Aktieselskab
, A/S), Norway
(Aksjeselskap
, AS), Sweden
(Aktiebolag
, AB), Lithuania
(Akcinė bendrovė, AB), Poland
(Spółka Akcyjna, S.A.), Slovakia
(akciová spoločnosť, a.s.), the Czech Republic
(Akciová společnost, a.s.), Slovenia
(delniška družba, d.d.), Serbia
(akcionarsko društvo, a.d.), Croatia
(dioničko društvo, d.d.), Romania
(Societate pe Acţiuni, s.a.), Bulgaria
n (Акционерно дружество, а.д.), Russia
(Открытое акционерное общество, Otkrytoye Aktsionernoye Obshestvo, OAO), and Finland
(Osakeyhtiö
, OY), among others. All have names that more or less literally translate to "Aktiengesellschaft" (for meaning see above), although their structures differ (for instance, an Italian S.p.A. is closer to a French S.A. than to a German AG).
The form is roughly equivalent to the public limited company
(plc) in the United Kingdom
and Republic of Ireland
, to the publicly-held/open corporation
in the United States
, to the Naamloze Vennootschap
in Netherlands
and Belgium
, to the S.A.
in Spain
, France, Portugal
and other civil-law
jurisdictions, and to the Societas Europaea in the European Union.
German language
German is a West Germanic language, related to and classified alongside English and Dutch. With an estimated 90 – 98 million native speakers, German is one of the world's major languages and is the most widely-spoken first language in the European Union....
term that refers to a corporation
Corporation
A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...
that is limited by share
Share (finance)
A joint stock company divides its capital into units of equal denomination. Each unit is called a share. These units are offered for sale to raise capital. This is termed as issuing shares. A person who buys share/shares of the company is called a shareholder, and by acquiring share or shares in...
s, i.e. owned by shareholder
Shareholder
A shareholder or stockholder is an individual or institution that legally owns one or more shares of stock in a public or private corporation. Shareholders own the stock, but not the corporation itself ....
s, and may be traded on a stock market
Stock market
A stock market or equity market is a public entity for the trading of company stock and derivatives at an agreed price; these are securities listed on a stock exchange as well as those only traded privately.The size of the world stock market was estimated at about $36.6 trillion...
. The term is used in Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
, Austria
Austria
Austria , officially the Republic of Austria , is a landlocked country of roughly 8.4 million people in Central Europe. It is bordered by the Czech Republic and Germany to the north, Slovakia and Hungary to the east, Slovenia and Italy to the south, and Switzerland and Liechtenstein to the...
and Switzerland
Switzerland
Switzerland name of one of the Swiss cantons. ; ; ; or ), in its full name the Swiss Confederation , is a federal republic consisting of 26 cantons, with Bern as the seat of the federal authorities. The country is situated in Western Europe,Or Central Europe depending on the definition....
. It is also used occasionally in Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
(though the French-language equivalent Société Anonyme is more common) and for companies incorporated in the German speaking region of Belgium
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
.
Meaning of the word
The GermanGerman language
German is a West Germanic language, related to and classified alongside English and Dutch. With an estimated 90 – 98 million native speakers, German is one of the world's major languages and is the most widely-spoken first language in the European Union....
word Aktiengesellschaft is a compound noun made up of two elements: Aktien meaning shares, and Gesellschaft meaning society, or, in this context, company. Other types of German companies also have shares, although these shares are called Anteile rather than Aktien. A similar distinction exists in other languages; for example, in Polish
Polish language
Polish is a language of the Lechitic subgroup of West Slavic languages, used throughout Poland and by Polish minorities in other countries...
the two types of share are called akcja and udział, or in Spanish
Spanish language
Spanish , also known as Castilian , is a Romance language in the Ibero-Romance group that evolved from several languages and dialects in central-northern Iberia around the 9th century and gradually spread with the expansion of the Kingdom of Castile into central and southern Iberia during the...
, acción and cuota.
Legal basis
In Germany and Austria, the legal basis of the AG is the respective Aktiengesetz (abbr. AktG). In Switzerland, it is contained within the Obligationenrecht (OR). The law requires all corporations to specify their legal form in their name which tells the public their limitation of liabilityLegal liability
Legal liability is the legal bound obligation to pay debts.* In law a person is said to be legally liable when they are financially and legally responsible for something. Legal liability concerns both civil law and criminal law. See Strict liability. Under English law, with the passing of the Theft...
, all German (required by § 4 Aktiengesetz) and Austrian stock corporations include Aktiengesellschaft or AG as part of their name, frequently as a suffix.
Structure
German AGs have a "two-tiered board" structure consisting of a supervisory board (Aufsichtsrat) and a management board (Vorstand). The supervisory board is generally controlled by shareholders, although employees may have seats depending on the size of the company. The management board directly runs the company, but its members may be removed by the supervisory board, which also determines the management board's compensation. Some German AGs have management boards which determine their own remuneration, but that situation is now relatively uncommon.Similar forms
Several countries have similar forms of company: ItalyItaly
Italy , officially the Italian Republic languages]] under the European Charter for Regional or Minority Languages. In each of these, Italy's official name is as follows:;;;;;;;;), is a unitary parliamentary republic in South-Central Europe. To the north it borders France, Switzerland, Austria and...
(Società per Azioni, S.p.A.), Denmark
Denmark
Denmark is a Scandinavian country in Northern Europe. The countries of Denmark and Greenland, as well as the Faroe Islands, constitute the Kingdom of Denmark . It is the southernmost of the Nordic countries, southwest of Sweden and south of Norway, and bordered to the south by Germany. Denmark...
(Aktieselskab
Aktieselskab
An aktieselskab is the Danish name for a stock-based corporation. An aktieselskab can be both publicly traded and private.-Liability:...
, A/S), Norway
Norway
Norway , officially the Kingdom of Norway, is a Nordic unitary constitutional monarchy whose territory comprises the western portion of the Scandinavian Peninsula, Jan Mayen, and the Arctic archipelago of Svalbard and Bouvet Island. Norway has a total area of and a population of about 4.9 million...
(Aksjeselskap
Aksjeselskap
Aksjeselskap is the Norwegian term for a stock-based company. It is usually abbreviated AS or A/S, especially when used in company names. An AS is always a limited company, i.e. the owners cannot be held liable for any debt beyond the stock capital...
, AS), Sweden
Sweden
Sweden , officially the Kingdom of Sweden , is a Nordic country on the Scandinavian Peninsula in Northern Europe. Sweden borders with Norway and Finland and is connected to Denmark by a bridge-tunnel across the Öresund....
(Aktiebolag
Aktiebolag
Aktiebolag is the Swedish term for "limited company" or "corporation". When used in company names, it is abbreviated "AB" or "Ab"...
, AB), Lithuania
Lithuania
Lithuania , officially the Republic of Lithuania is a country in Northern Europe, the biggest of the three Baltic states. It is situated along the southeastern shore of the Baltic Sea, whereby to the west lie Sweden and Denmark...
(Akcinė bendrovė, AB), Poland
Poland
Poland , officially the Republic of Poland , is a country in Central Europe bordered by Germany to the west; the Czech Republic and Slovakia to the south; Ukraine, Belarus and Lithuania to the east; and the Baltic Sea and Kaliningrad Oblast, a Russian exclave, to the north...
(Spółka Akcyjna, S.A.), Slovakia
Slovakia
The Slovak Republic is a landlocked state in Central Europe. It has a population of over five million and an area of about . Slovakia is bordered by the Czech Republic and Austria to the west, Poland to the north, Ukraine to the east and Hungary to the south...
(akciová spoločnosť, a.s.), the Czech Republic
Czech Republic
The Czech Republic is a landlocked country in Central Europe. The country is bordered by Poland to the northeast, Slovakia to the east, Austria to the south, and Germany to the west and northwest....
(Akciová společnost, a.s.), Slovenia
Slovenia
Slovenia , officially the Republic of Slovenia , is a country in Central and Southeastern Europe touching the Alps and bordering the Mediterranean. Slovenia borders Italy to the west, Croatia to the south and east, Hungary to the northeast, and Austria to the north, and also has a small portion of...
(delniška družba, d.d.), Serbia
Serbia
Serbia , officially the Republic of Serbia , is a landlocked country located at the crossroads of Central and Southeast Europe, covering the southern part of the Carpathian basin and the central part of the Balkans...
(akcionarsko društvo, a.d.), Croatia
Croatia
Croatia , officially the Republic of Croatia , is a unitary democratic parliamentary republic in Europe at the crossroads of the Mitteleuropa, the Balkans, and the Mediterranean. Its capital and largest city is Zagreb. The country is divided into 20 counties and the city of Zagreb. Croatia covers ...
(dioničko društvo, d.d.), Romania
Romania
Romania is a country located at the crossroads of Central and Southeastern Europe, on the Lower Danube, within and outside the Carpathian arch, bordering on the Black Sea...
(Societate pe Acţiuni, s.a.), Bulgaria
Bulgaria
Bulgaria , officially the Republic of Bulgaria , is a parliamentary democracy within a unitary constitutional republic in Southeast Europe. The country borders Romania to the north, Serbia and Macedonia to the west, Greece and Turkey to the south, as well as the Black Sea to the east...
n (Акционерно дружество, а.д.), Russia
Russia
Russia or , officially known as both Russia and the Russian Federation , is a country in northern Eurasia. It is a federal semi-presidential republic, comprising 83 federal subjects...
(Открытое акционерное общество, Otkrytoye Aktsionernoye Obshestvo, OAO), and Finland
Finland
Finland , officially the Republic of Finland, is a Nordic country situated in the Fennoscandian region of Northern Europe. It is bordered by Sweden in the west, Norway in the north and Russia in the east, while Estonia lies to its south across the Gulf of Finland.Around 5.4 million people reside...
(Osakeyhtiö
Osakeyhtiö
Osakeyhtiö, literally a "stock company", is the Finnish equivalent of a limited company or Gesellschaft mit beschränkter Haftung . It is abbreviated to Oy and is used either before or after the company's name, sometimes with the addition of the Finland-Swedish equivalent Ab...
, OY), among others. All have names that more or less literally translate to "Aktiengesellschaft" (for meaning see above), although their structures differ (for instance, an Italian S.p.A. is closer to a French S.A. than to a German AG).
The form is roughly equivalent to the public limited company
Public limited company
A public limited company is a limited liability company that sells shares to the public in United Kingdom company law, in the Republic of Ireland and Commonwealth jurisdictions....
(plc) in the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
and Republic of Ireland
Republic of Ireland
Ireland , described as the Republic of Ireland , is a sovereign state in Europe occupying approximately five-sixths of the island of the same name. Its capital is Dublin. Ireland, which had a population of 4.58 million in 2011, is a constitutional republic governed as a parliamentary democracy,...
, to the publicly-held/open corporation
Public company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, to the Naamloze Vennootschap
Naamloze Vennootschap
is the Dutch term for a public limited liability company. The company is owned by shareholders, and the company's shares are not registered to certain owners, so that they may be traded on the public stock market....
in Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
and Belgium
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
, to the S.A.
S.A. (corporation)
S.A. designates a particular type of corporation in various countries, mostly those employing the civil law. It originated in Spain during the 16th century. Depending on language, the abbreviation stands for various phrases meaning anonymous society, anonymous company, anonymous partnership, or...
in Spain
Spain
Spain , officially the Kingdom of Spain languages]] under the European Charter for Regional or Minority Languages. In each of these, Spain's official name is as follows:;;;;;;), is a country and member state of the European Union located in southwestern Europe on the Iberian Peninsula...
, France, Portugal
Portugal
Portugal , officially the Portuguese Republic is a country situated in southwestern Europe on the Iberian Peninsula. Portugal is the westernmost country of Europe, and is bordered by the Atlantic Ocean to the West and South and by Spain to the North and East. The Atlantic archipelagos of the...
and other civil-law
Civil law (legal system)
Civil law is a legal system inspired by Roman law and whose primary feature is that laws are codified into collections, as compared to common law systems that gives great precedential weight to common law on the principle that it is unfair to treat similar facts differently on different...
jurisdictions, and to the Societas Europaea in the European Union.
See also
- Gesellschaft mit beschränkter HaftungGesellschaft mit beschränkter HaftungGesellschaft mit beschränkter Haftung is a type of legal entityvery common in Germany, Austria, Switzerland, and other Central European countries...
(GmbH; limited liability company) - Types of business entity