The effects of inspire art: A Critical comparison of the formation of German and English companies

On 30 September 2003, the European Court of Justice continued, in its Inspire Art decision, in its quest to strengthen freedom of establishment. This decision has lead to an ever increasing number of English private limited liability companies (hereafter, ‘Ltds.’) operating in Germany. It is the purpose of this paper to compare a Ltd. with Its German correlate, the GmbH, focussing on foundation and capital requirements. It is argued that currently it is not advisable to operate Ltds. in Germany. In this respect, suggestions for the further harmonisation of European Company Law will be advanced.