Kommanditgesellschaft
Encyclopedia
A Kommanditgesellschaft (abbreviated "KG") is the German name for a limited partnership
business entity and is used in German
, Austria
n and some other European
legal
systems.
Partnerships may be formed in the legal forms of General Partnership
(Offene Handelsgesellschaft, OHG) or Limited Partnership
(Kommanditgesellschaft, KG).
In the OHG, all partners are fully liable for the partnership's debts, whereas in the KG there are general partners (Komplementär) with unlimited liability and limited partners (Kommanditisten) whose liability is restricted to their fixed contributions to the partnership. Although a partnership itself is not a legal entity, it may acquire rights and incur liabilities, acquire title to real estate and sue or be sued.
The GmbH
& Co. KG is a limited partnership with, typically, the sole general partner being a limited liability company. It can thus combine the advantages of a partnership with those of the limited liability of a corporation.
A Dormant Partnership (Stille Gesellschaft) comes into existence when a person makes a contribution to an existing enterprise (company, partnership, sole proprietorship) and shares in the latter's profits. The dormant partner has no liability for the debts of the enterprise; in case of insolvency of the enterprise he is a creditor with the portion of his contribution not consumed by losses. Strictly speaking, the dormant partnership is nothing more than an 'undisclosed participation'.
A Civil-Law Association is not a legal entity and cannot sue or be sued. It is often used for single joint ventures (e.g. construction projects) and comes to an end when the joint project has been completed.
A Private Foundation (Privatstiftung) constitutes a conglomeration of property having legal personality but no shareholders; its activities involve managing its own funds and assets for the beneficiaries.
Limited partnership
A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners , there are one or more limited partners . It is a partnership in which only one partner is required to be a general partner.The GPs are, in all major respects,...
business entity and is used in German
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...
n and some other European
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
legal
Law
Law is a system of rules and guidelines which are enforced through social institutions to govern behavior, wherever possible. It shapes politics, economics and society in numerous ways and serves as a social mediator of relations between people. Contract law regulates everything from buying a bus...
systems.
Partnerships may be formed in the legal forms of General Partnership
General partnership
In the commercial and legal parlance of most countries, a general partnership or simply a partnership, refers to an association of persons or an unincorporated company with the following major features:...
(Offene Handelsgesellschaft, OHG) or Limited Partnership
Limited partnership
A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners , there are one or more limited partners . It is a partnership in which only one partner is required to be a general partner.The GPs are, in all major respects,...
(Kommanditgesellschaft, KG).
In the OHG, all partners are fully liable for the partnership's debts, whereas in the KG there are general partners (Komplementär) with unlimited liability and limited partners (Kommanditisten) whose liability is restricted to their fixed contributions to the partnership. Although a partnership itself is not a legal entity, it may acquire rights and incur liabilities, acquire title to real estate and sue or be sued.
The GmbH
Gesellschaft mit beschränkter Haftung
Gesellschaft mit beschränkter Haftung is a type of legal entityvery common in Germany, Austria, Switzerland, and other Central European countries...
& Co. KG is a limited partnership with, typically, the sole general partner being a limited liability company. It can thus combine the advantages of a partnership with those of the limited liability of a corporation.
A Dormant Partnership (Stille Gesellschaft) comes into existence when a person makes a contribution to an existing enterprise (company, partnership, sole proprietorship) and shares in the latter's profits. The dormant partner has no liability for the debts of the enterprise; in case of insolvency of the enterprise he is a creditor with the portion of his contribution not consumed by losses. Strictly speaking, the dormant partnership is nothing more than an 'undisclosed participation'.
A Civil-Law Association is not a legal entity and cannot sue or be sued. It is often used for single joint ventures (e.g. construction projects) and comes to an end when the joint project has been completed.
A Private Foundation (Privatstiftung) constitutes a conglomeration of property having legal personality but no shareholders; its activities involve managing its own funds and assets for the beneficiaries.