Shelf Company versus Company Formation

“Austrian shelfcompany (ready made company) or formation of a new Austrian GmbH?” is one of the questions we get asked quite frequently.

The main advantage of an Austrian ready made company is, that it can be used immediately after acquisition (can be arranged within 24 hours). The Austrian GmbH does already have a bank account and a tax number. Typically, Austrian shelf companies are chosen in the following situations:

• A target (real estate, company) shall be purchased and the seller does not want to wait until a new holding company is registered.
• The buyer(s) of an Austrian Limited company are not from Austria and want to avoid taking care of the formation process themselves.
• For certain reasons a participation shall be purchased or sold immediately.
• The formation of a new Austrian limited company (GmbH) on the other hand has the advantage, that no purchase price has to be paid. Furthermore, notary and court fees for the transfer of the shares can be avoided. The downside is, however, that the formation process can take up to 6 weeks and its success is not guaranteed.