LIECHTENSTEIN COMPANY
LAW
THE PREVALENT REVISED SECTIONS FROM
THE PERSONEN- UND GESELLSCHAFTSRECHT
ALSO RELEVANT LAWS ISSUED
SINCE PUBLICATION OF THE FIRST EDITION
COMPILED AND TRANSLATED
BY BRYAN JEEVES OBE

– I–
LIECHTENSTEIN COMPANY LAW

Respectfully dedicated
to H.S.H. The Reigning Prince Hans-Adam II
of Liechtenstein
and the Princely Liechtenstein Government
– II–

LIECHTENSTEIN COMPANY
LAW
THE PREVALENT REVISED SECTIONS FROM
THE PERSONEN- UND GESELLSCHAFTSRECHT
ALSO RELEVANT LAWS ISSUED
SINCE PUBLICATION OF THE FIRST EDITION
COMPILED AND TRANSLATED
BY BRYAN JEEVES OBE
LIECHTENSTEIN VERLAG VADUZ – III–

Die Deutsche Bibliothek – CIP-Einheitsaufnahme
Liechtenstein company law:translation from the PGR update 1999 /
Bryan Jeeves. – 2. Aufl. – Vaduz: Liechtenstein-Verlag, 1999
ISBN 3-85789-902-6
© 1999 Liechtenstein Verlag AG, Vaduz
2nd Edition– 1999
Alle Rechte, auch die des auszugsweisen Nachdruckes, der fotomechani-
schen Wiedergabe, der Foto- und Mikrokopie vorbehalten.
All rights reserved. No reproduction or transmissions by electronic or
mechanical means and no photocopies permitted.
Satz und Druck: Gutenberg AG, Schaan
Printed in the Principality of Liechtenstein
ISBN 3-85789-902-6
– IV–

Index
Vorwort 1999VII
Preface 1999IX
Liechtenstein Company Law
– Table of Contents1
– General Provisions17
– The Company Limited By Shares103
– The Establishments153
– The Foundations163
– The Trusts in General173
– The Trust Enterprise (The Business Trust)195
– Business Accountancy307
Law on Banks and Finance Companies321
Law on the Supervision of Insurance Undertakings347
Law on Investment Undertakings387
Law on professional due diligence in the acceptance of assets417
Law on the Provision, Control and Distrubution
of the Prospectus to be published on the Occasion
of the Public Offer of Securities 429
Glossarium – Glossary443
Curriculum vitae Bryan Jeeves453 – V–

– VI–

Vorwort 1999
Diese Zweitausgabe wird aus zweierlei Gründen veröffentlicht.
Erstens hat der Verleger – da die erste Ausgabe erfreulicherweise
komplettt vergriffen ist – angesichts der diesbezüglich fehlenden
englischen Literatur kontinuierlich dazu gedrängt. Zweitens hat
Liechtenstein seine Gesetzgebung mit neuen Gesetzen über Versi-
cherungsunternehmen, Banken und Finanzgesellschaften, Invest-
mentunternehmen sowie über die beruflichen Sorgfaltspflichten,
die in diese Zweitausgabe einbezogen wurden, erheblich erweitert.
Seit der Erstausgabe in 1992 hat sich in Liechtenstein viel ereignet.
Liechtensteins Beitritt zum EWR wird wahrscheinlich als das
wichtigste Ereignis in dieser Zeitspanne in die Geschichte eingehen.
Wie David Davis MP PC, der damalige Europa-Minister der bri-
tischen Regierung, treffend formulierte, «vereinigt Liechtenstein
das Beste von beiden Welten, die EWR-Mitgliedschaft und fort-
bestehende Vorteile aus der Zollunion mit der Schweiz.»
Die seitens des Regierenden Fürsten und der Regierung bei der
Förderung von Liechtensteins Beitritt zum EWR gezeigte Führung
und Weitsicht finden ihre Bestätigung in allem, was seitdem ge-
schehen ist. Daher widme ich – wie bereits die Erstausgabe – auch
dieses Buch Seiner Durchlaucht sowie der Landesregierung. Durch
ihre stets nach vorn gerichtete Politik ist Liechtensteins Position im
neuen Jahrtausend garantiert.
Die zweite durchschlagende Änderung in Liechtenstein ist die Bil-
dung einer Einparteien-Regierung erstmals seit dem Zweiten Welt-
krieg. Ich kann den Mut der beteiligten politischen Parteien – in
der Regierung wie auch in der Opposition – für diesen Schritt nur
bewundern, der grossartig den wahren demokratischen Status von
Liechtenstein bestätigt. Liechtenstein ist trotz seiner unbedeuten-
den geographischen Grösse zweifellos ein völlig unabhängiges
Land im wahrsten Sinne des Wortes mit einer vielerseits begehrten
Infrastruktur geworden.
Last but not least war diese Neuauflage nur durch die ausgezeich-
nete Teamarbeit unter Leitung von Frederick Hilton und mit der
Unterstützung von Christopher Salt möglich – ein Team, das unse- – VII–

re herausragende Stellung als Übersetzungsfirma in Liechtenstein
gewährleistet hat, seitdem ich 1979 der erste ordnungsgemäss zuge-
lassene Übersetzer wurde.
Bryan Jeeves OBE, FinstD – VIII–

Preface 1999
This second edition has been published for two reasons. Happily the
first edition has been completely sold out and the lack of English li-
terature on the subject has led to continuing requests from the Pu-
blisher. Secondly, Liechtenstein has greatly expanded its legislation
with new laws on insurance companies, banks, finance and invest-
ment entities, as well as due diligence, which are now included in
this second edition.
Since the first edition was published during 1992 much has happen-
ed in Liechtenstein. Probably history will show Liechtenstein’s joi-
ning the EEA as the most important event during this period of
time. As the then European Minister of the UK Government, the
Rt. Hon. David Davis MP PC quite rightly said, “Liechtenstein
has the best of both worlds, EEA membership and continuing
advantages from the Customs Treaty with Switzerland”.
The leadership and foresight shown by the Reigning Prince and the
Government in promoting Liechtenstein’s entry into the EEA have
been confirmed by all that has happened since then. Therefore, I
again dedicate this book to His Serene Highness, as was the case
with the first edition, as well as the Government of the country.
They continue to move forward assuring Liechtenstein’s position in
the new millennium.
The second sweeping change in Liechtenstein is the forming of a
single party Government for the first time since the Second World
War. I have nothing but admiration for the courage of the political
parties involved, both in Government and Opposition for this step,
which admirably confirms the true democratic status of Liechten-
stein. Liechtenstein, despite its lack of geographic size, has unques-
tionably become a fully independent country in the true sense of
that word, with an infrastructure coveted by many.
Last but not least, this new edition has only been made possible by
a magnificent team effort led by Frederick Hilton, ably supported
by Christopher Salt, a team that has ensured our prominence as a
translation firm in Liechtenstein, since becoming the first duly ad-
mitted translator in 1979.
Bryan Jeeves OBE, FinstD – IX–

– 1–
Art.
Table of Contents
Extracts from the Liechtenstein Law on Companies
Second Part
The Legal Entities
(Juridical Persons)
Third Title
General Provisions
Art.
A.Legal Personality
I.Preconditions
1. Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106
2. Purpose and object . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107
II.Absence of the same . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108
III.Legal capacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .109
IV.Capacity to act and for tortious liability
1. Precondition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .110
2. Activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .111–112
V.Domicile and legal venue
1. Domicile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .113
2. Legal venue, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .114
VI.Protection of personality . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115
B.Formation
I.Articles
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .116
2. Relationship to the law . . . . . . . . . . . . . . . . . . . . . . . . . . . . .117
II.Entry in the Public Register
1. Notification to the Register office . . . . . . . . . . . . . . . . . . . .118
2. Registration of branch establishments . . . . . . . . . . . . . . . .119
3. Amendments and dissolution . . . . . . . . . . . . . . . . . . . . . . . .120
III.Number of members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .121
IV.Minimum capital resources or
minimum own assets and the like . . . . . . . . . . . . . . . . . . . . . .122
C.Termination
I.Reasons for dissolution
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .123
2. On grounds of unlawfulness or immorality
of the purpose etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124
3. On grounds of important defects in
the articles (voidability) . . . . . . . . . . . . . . . . . . . . . . .125–128

II.Application of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129
III.Liquidation
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .130
2. The state of liquidation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .131
3. Liquidators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .132–134
4. Liquidation activity . . . . . . . . . . . . . . . . . . . . . . . . . . .135–138
5. Supplementary liquidation . . . . . . . . . . . . . . . . . . . . . . . . . .139
6. Alienation of the assets as a whole . . . . . . . . . . . . . . . . . . . .140
IV.Assertion of claims against a dissolved legal entity . . . . . . . .141
V.The keeping of business records and business papers . . . . . .142
VI.Take-over by the community
1. By acquisition of the shares . . . . . . . . . . . . . . . . . . . . . . . . .143
2. Take-over of the assets and liabilities . . . . . . . . . . . . .144, 145
VII.Continuation of a dissolved legal entity . . . . . . . . . . . . . . . . .146
D.Membership
I.Joining
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .147
2. Rescission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .148
II.Membership shares
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .149
2. Securities concerning membership . . . . . . . . . . . . . . . . . . .150
3. Personal participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .151
4. Several participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .152
5. Trust certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .153, 154
III.Established and other rights . . . . . . . . . . . . . . . . . . . . . . . . . . .155
IV.Liability and liability to effect further contributions
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .156
2. The contribution procedure . . . . . . . . . . . . . . . . . . . .157–164
V.Default in the performance in kind, exclusion
of the settlement, of the right of retention, etc. . . . . . . . . . . .165
E.Governing bodies
I.Supreme body
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .166
2. Convocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .167, 168
3. Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .169
4. Authority and passing of resolutions . . . . . . . . . . . . .170–177
5. Rescission of resolutions . . . . . . . . . . . . . . . . . . . . . . .178–179
II.Administration
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .180–180a
2. Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .181–183
3. Representation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .184–189
4. Appointment of a legal advisor . . . . . . . . . . . . . . . . . .190, 191
III.Audit authority
1. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .192
2. Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .193,194
3. Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .195–197
– 2–
Art.

4. Other provisions of the articles . . . . . . . . . . . . . . . . . . . . . .198
5. Supervisory board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .199
IV.Other bodies and applicable law . . . . . . . . . . . . . . . . . . . . . . .200
V.Termination and removal . . . . . . . . . . . . . . . . . . . . . . . . . . . . .201
F.Clearing System
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .202
II.Annual balance-sheet regulations
1. Date of balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .203
2. Balance sheet principles . . . . . . . . . . . . . . . . . . . . . . . .204–206
3. Publication of the annual balance sheet . . . . . . . . . . . . . . .207
4. Duty to disclose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .208, 209
III.Official audit
1. Precondition and appointment . . . . . . . . . . . . . . . . . . . . . .210
2. Position of the auditors . . . . . . . . . . . . . . . . . . . . . . . . . . . .211
3. Treatment of the auditors’ report . . . . . . . . . . . . . . . . . . . .212
4. Costs and compensation for loss . . . . . . . . . . . . . . . . . . . . .213
G.Socio-political rights to shares and profit
I.Working shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .214
II.Welfare funds
1. Preconditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .215
2. Structure and dissolution . . . . . . . . . . . . . . . . . . . . . . . . . . .216
III.Other profit participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . .217
H.Responsibility
I.In the case of companies with legal personality and
legal entities on the same footing
1. Kind of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .218
2. Cases of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .219–221
3. Liability claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .222–225
4. Nature of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .226
5. Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .227
II.In the case of other legal entities . . . . . . . . . . . . . . . . . . . . . . .228
J.Participation of legal entities under public law
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .229
II.Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .230
K.Notification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .231
L.International law
I.Foreign or domestic legal entities and applicable law . . . . . .232
II.Transfer of a legal entity
1. Transfer of the legal entity from abroad to Liechtenstein .233
2. Transfer of the legal entity from Liechtenstein
to another State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .234
III.Legal capacity and capacity to act
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .235
2. Branch establishment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .236
3. Protection of the personality . . . . . . . . . . . . . . . . . . . . . . . .237
4. Protection of name and style . . . . . . . . . . . . . . . . . . . . . . . .237a
– 3–
Art.

5. Restriction of the authority to represent . . . . . . . . . . . . . .237b
6. Liability for foreign legal entities . . . . . . . . . . . . . . . . . . . . .237c
7. Claims from the public issue ef equities and bonds . . . . . .237d
8. Restriction of mortmain . . . . . . . . . . . . . . . . . . . . . . . . . . . .238
IV.Legal representative
1. Obligation to appoint . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .239
2. Registration in the Public Register . . . . . . . . . . . . . . . . . . .240
3. Legal power of agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . .241
4. Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .242
5. Cancelled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .243
M.Reservation and scope of application
I.Reservation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .244
II.Scope of validity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .245
Fourth Title
Second Section
The Company Limited by Shares
A.General provisions
I.Definition
1. In the case of fixed shares . . . . . . . . . . . . . . . . . . . . . . . . . . .261
2. In the case of non par value shares . . . . . . . . . . . . . . . . . . .262
II.Share
1. Type of shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .263
2. Division, consolidation and change of
shares or units of shares . . . . . . . . . . . . . . . . . . . . . . . . . . . .264
3. Reduction of the nominal value . . . . . . . . . . . . . . . . . . . . . .265
4. The amount of the share . . . . . . . . . . . . . . . . . . . . . . . . . . . .266
5. Share certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .267–271
6. Workers’ shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .272–278
III.Articles
1. Legally required content . . . . . . . . . . . . . . . . . . . . . . . . . . . .279
2. Provisions to be drawn up if necessary . . . . . . . . . . . . . . . .280
B.Formation
I.Successive formation
1. Formation requirements in general . . . . . . . . . . . . . . . . . . .281
2. Cancelled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .282
Subscription and paying in . . . . . . . . . . . . . . . . . . . . . . . . . .283
3. Constitutive resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . .284
4. Procedure relating to capital invested,
acquisitions and founders’ preference rights . . . . . . .285–287
II.Simultaneous formation
1. Formation of the company . . . . . . . . . . . . . . . . . . . . . . . . . .288
2. Blocking the shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .289
– 4–
Art.

III.Registration of the company
1. Notification of registration . . . . . . . . . . . . . . . . . . . . . . . . .290
2. Registration and publication . . . . . . . . . . . . . . . . . . . . . . . .291
C.Protection of the nominal capital and the shareholders
I.Protection of vested rights
1. Protection of the individual . . . . . . . . . . . . . . . . . . . . . . . . .292
2. Requirement of the specially conditioned
majority of the general meeting . . . . . . . . . . . . . . . . . . . . . .293
II.Business expansion, business contraction and merger . . . . . .294
III.Issuance of new shares
1. General prerequisites . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .295
2. As counter-performance for payment in kind and rights .296
3. Issuance without payment in cash or kind . . . . . . . . . . . . .297
4. Cancelled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .298
IV.Issue of preference shares
1. Authority to issue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .299
2. Passing of resolutions . . . . . . . . . . . . . . . . . . . . . . . . . . . . .300
3. Status of preference shares . . . . . . . . . . . . . . . . . . . . . . . . . .301
V.The issuance of bonus shares . . . . . . . . . . . . . . . . . . . . . . . . . .302
VI.Subscription right and obligation to subscribe . . . . . . . . . . . .303
VII.The issuance of dividend right certificates . . . . . . . . . . . . . . .304
VIII.Documentation and registration of article amendments . . . .305
IX.Acquisition of the company’s own shares . . . . . . . . . . . . . . . .306
D.Shareholders rights and duties
I.Shares of profit and liquidation proceeds
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .307
2. Method of calculation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .308
II.Reserve fund
1. Reserve fund required by law . . . . . . . . . . . . . . . . . . . . . . .309
2. Reserve fund provided in the articles . . . . . . . . . . . . . . . . .310
3. Relationship of the profit share to the reserve assets . . . . .311
III.Dividends, building interest, directors’ remuneration, etc.
1. Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .312
2. Building interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .313
3. Management fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .314
4. Other claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .315
IV.Statute of limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .316
V.The shareholders’ liability
1. Object . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .317
2. Additional contributory shares . . . . . . . . . . . . . . . . . .318, 319
3. Consequences of undue delay . . . . . . . . . . . . . . . . . . .320, 321
VI.Legal relationship of the shareholders
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .322
2. In the case of bearer shares . . . . . . . . . . . . . . . . . . . . .323–326
3. In the case of registered shares . . . . . . . . . . . . . . . . . .327–330
VII.Declaration that shares are not fully paid up . . . . . . . . . . . . .331
– 5–
Art.

VIII.Personal membership rights
1. Participation in the general meeting . . . . . . . . . . . . . .332, 333
2. The right to vote at the general meeting . . . . . . . . . . .334, 335
3. The shareholders’ right of verification . . . . . . . . . . .336, 337
E.Governing bodies
I.General meeting
1. Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .338
2. Convening . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .339
3. The passing of resolutions . . . . . . . . . . . . . . . . . . . . . . . . . .340
II.Board of directors
1. Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .341
2. Deposition of shares . . . . . . . . . . . . . . . . . . . . . . . . . . .342, 343
3. Board of directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . .344–349
III.Audit authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .350
F.Merger
I.Take-over of one limited company by another . . . . . . . . . . .351
II.Merging of several limited companies . . . . . . . . . . . . . . . . . . .352
III.Take-over by a partnership limited by shares . . . . . . . . . . . . .353
G.Transfer to the community . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .354
H.Repayment and other reductions of the nominal capital
I.Resolution to repay and reduce, etc. . . . . . . . . . . . . . . . . . . . .355
II.Repayment of capital with reservation of return payment . .356
III.Consolidation and reduction of the number of shares . . . . .357
IV.Amortisation
1. Preconditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .358
2. Redemption and drawing . . . . . . . . . . . . . . . . . . . . . . . . . . .359
3. Issue of bonus shares by drawing . . . . . . . . . . . . . . . . . . . .360
J.Limited companies with variable invested capital
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .361
II.Maximum and minimum nominal capital . . . . . . . . . . . . . . . .362
III.Reduction
1. Precondition and procedure . . . . . . . . . . . . . . . . . . . . . . . .363
2. Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .364
IV.Mandatory reserve fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .365
V.Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .366
VI.Registration in the Public Register . . . . . . . . . . . . . . . . . . . . .367
– 6–
Art.

Fifth Title
The Establishments and Foundations
First Section
The Establishments
A.Concept and definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .534
B.Formation
I.Founder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .535
II.Articles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .536
III.Entry in the Establishment Register
1. Registration on the Register . . . . . . . . . . . . . . . . . . . . . . . . .537
2. Entry and publication . . . . . . . . . . . . . . . . . . . . . . . . . . . . .538
IV.Establishment fund, liability . . . . . . . . . . . . . . . . . . . . . . . . . .539
V.Establishment shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .540
C.Founder’s rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .541
D.Contestation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .542
E.Governing bodies
I.Supreme body . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .543
II.Establishment administration and audit authority . . . . . . . . .544
F.Legal relationship of the founder and the beneficiaries to the
establishment, between themselves and towards third parties
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .545
II.Non-withdrawability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .546
III.Determination of assets and profits . . . . . . . . . . . . . . . . . . . . .547
IV.Liability of the establishment, limited liability or
liability to make further contributions . . . . . . . . . . . . . . . . . .548
G.Amendment of articles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .549
H.Dissolution, merger and conversion . . . . . . . . . . . . . . . . . . . . . . . .550
J.Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .551
Second Section
The Foundations
A.Definition and delimitation
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .552
II.Ecclesiastical and family foundations . . . . . . . . . . . . . . . . . . .553
III.Deposition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .554
B.Formation
I.Foundation deed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .555
II.Entry on the Foundation Register . . . . . . . . . . . . . . . . . . . . . .556
III.Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .557
IV.Donation of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .558
V.Revocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .559
VI.Contestation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .560
– 7–
Art.

C.Governing bodies
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .561
II.Order of the Supervising Authority . . . . . . . . . . . . . . . . . . . .562
D.Liability and exclusion of enforcement, etc. . . . . . . . . . . . . . . . . . .563
E.Supervision
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .564
II.Amendment
1. Concerning the governing bodies . . . . . . . . . . . . . . . . . . . .565
2. Concerning the purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . .566
F.Family foundations, ecclesiastical foundations and similar . . . . . .567
G.Cancellation
I.By operation of law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .568
II.Right of action and deregistration . . . . . . . . . . . . . . . . . . . . . .569
III.Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .570
Fifteenth Title
The Individually Owned Enterprise with Limited Liability
(repealed) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .834 to 896a
Sixteenth Title
The Trusts
First Section
The Trusts in General
A.Definition
I.The trust relationship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .897
II.The implied trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .898
B.Creation and termination of the trust
I.Creation
1. Trust instrument . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .899
2. Registration on public registers . . . . . . . . . . . . . . . . . .900–902
3. Notification of appointment . . . . . . . . . . . . . . . . . . . . . . . .903
4. Judicial and public trustee and legal representative . .904, 905
II.Termination
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .906
2. Grounds for termination relating to the settlor . . . . . . . . .907
3. Termination relating to the trustee . . . . . . . . . . . . . . .908, 909
C.Terms and effect of the trust relationship
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .910
II.The trust property
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .911
2. Specific trust property . . . . . . . . . . . . . . . . . . . . . . . . . . . . .912
– 8–
Art.

3. Authorised trust investments . . . . . . . . . . . . . . . . . . . . . . . .913
4. Execution and bankruptcy . . . . . . . . . . . . . . . . . . . . .914–916
III.Rights and duties of the settlor
1. Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .917
2. Duties and other function . . . . . . . . . . . . . . . . . . . . . . . . . .918
IV.Rights and duties of the trustee
1. Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .919–921
2. Duties of the trustee . . . . . . . . . . . . . . . . . . . . . . . . . . .922–925
3. Reference, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .926
V.Position of the beneficiary
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .927
2. Trust certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .928
D.Supervision and other measures concerning trusts . . . . . . . . . . . . .929
E.International law and trusts under foreign law
I.International law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .930
II.Trusts under foreign law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .931
F.Professional trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .932
Second Section
The Trust Enterprise
(The Business Trust)
Art. 932a
A. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .§§
I.Special trusts
1.Definition
a.Trust enterprise without and with legal personality . . . .1
b.With divisions, trust funds or similar . . . . . . . . . . . . . . .2
2.Purpose or object . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3
II.Other fiduciary undertakings (repealed) . . . . . . . . . . . . . . . . .4
III.Reference, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
IV.Relationship of law and trust instrument . . . . . . . . . . . . . . . .6
B.Existence
I.Trust register
1.Entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
2.The absence of these . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
3.Trust articles
a.Necessary content . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9
b.Further statements and implementing provisions . . . . .10
4.Formation in the absence of the settlor
a.In general
aa.After the death of the settlor . . . . . . . . . . . . . . . . . . . .11
bb.Upon the termination of companies or legal entities12
cc.Legal power of authority . . . . . . . . . . . . . . . . . . . . . . .13
b. Formation procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
– 9–
Art.

II.Application, entry and notification or advertisement
1. Obligation, right and content . . . . . . . . . . . . . . . . . . . . . . . .15
2. Amendments and other declarations . . . . . . . . . . . . . . . . . .16
C.Termination (dissolution and cancellation)
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
II.Bankruptcy or administration proceedings . . . . . . . . . . . . . .18
III.Liquidation
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
2. Liquidators, time limit and public notice to creditors . . . .20
3. Distribution of assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
D.Trust fund
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
II.Securities in particular . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23
III.Liability and default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24
E.Trust assets
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25
II.Segregation and distribution of assets and yield
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
2. Gradual distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27
III.Administration of assets
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28
2. Alienation and charging . . . . . . . . . . . . . . . . . . . . . . . . . . . .29
3. Claim for surrender and enrichment . . . . . . . . . . . . . . . . . .30
4. Assets investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31
IV.Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32
V. Reserve fund and other reserves . . . . . . . . . . . . . . . . . . . . . . .33
VI.Accountancy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34
F.Rescission and right of redemption . . . . . . . . . . . . . . . . . . . . . . . . .35
G.Liability for the obligations of the trust enterprise
I.By operation of the law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
II.By operation of the trust instrument
and other transaction
1. Extension of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
2. Restriction of liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38
H.Participants
I.Common provisions
1. Kinds and regulation of the legal position . . . . . . . . . . . . .39
2. Rights and duties in particular . . . . . . . . . . . . . . . . . . . . . . .40
3. Governing bodies
a. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41
b. Resolutions and membership . . . . . . . . . . . . . . . . . . . . . .42
c.Supervisory trust body . . . . . . . . . . . . . . . . . . . . . . . . . . .43
4. Statutory limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44
5. Legal venue, court of arbitration, and
procedural position of participants
a. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45
– 10–
§§

b. Procedural position of participants
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
bb.Virtual representation . . . . . . . . . . . . . . . . . . . . . . . .47
6. Position of the sued party . . . . . . . . . . . . . . . . . . . . . . . . . . .48
II.Settlor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
III.Trustee
1. Appointment, removal, notice, etc.
a.In general
aa.In the case of trust enterprises without divisions . .50
bb.With divisions and in the case of several trusts . . . .51
b.Appointment
aa.Right to appoint . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52
bb.Choice and duty to disclose . . . . . . . . . . . . . . . . . . . .53
c.Removal
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .54
bb.In the case of security deposit by third parties . . . .55
d.Termination
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56
bb.Meaning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57
e.Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58
f.Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59
aa.For those appointed, removed, giving notice
termination, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59
bb.In the case of default, or non-exercise of the right or
the obligation to appoint, remove, propose or similar 60
2. Organisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61
3. Trust management
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62
b.Position of trustees not engaged in
the conduct of business . . . . . . . . . . . . . . . . . . . . . . . . . . .63
c.Regulations (internal regulations)
and transfer of management . . . . . . . . . . . . . . . . . . . . . . .64
d.Duty to be loyal
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65
bb.Personal interest
aaa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66
bbb.Acquisition of trust property and
beneficial rights . . . . . . . . . . . . . . . . . . . . . . . . . .67
cc.Obligation to disclose
aaa.To beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . .68
bbb. To co-trustees, etc. . . . . . . . . . . . . . . . . . . . . . . .69
e.Trust powers
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70
bb.Claims for compensation and trustee fees
aaa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71
bbb. Assertion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72
– 11–
§§

4.Trust power
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73
b.Appointment of representatives by the Register Office74
c.Minimum trust authority and minimum representative
authority by operation of law . . . . . . . . . . . . . . . . . . . . .75
d.Signature rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .76
e.Evidence of authority . . . . . . . . . . . . . . . . . . . . . . . . . . . .77
IV.Trust beneficiaries
1.Beneficial interest in general
a.Kinds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .78
b.Legal nature of the beneficial interest, etc. . . . . . . . . . . .79
c.Acquisition and loss (existence and loss)
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .80
bb.Gratuitous beneficial interest and
socio-political beneficial interest . . . . . . . . . . . . . . . .81
cc.Special skills . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82
dd.Convertible creditor and beneficiary rights . . . . . . .83
ee.Notice of termination, etc. . . . . . . . . . . . . . . . . . . . . .84
ff.Exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85
gg. Revocation
aaa.On grounds of unworthiness of trust . . . . . . . .86
bbb. For other reasons . . . . . . . . . . . . . . . . . . . . . . . .87
ccc.Application of revocation and reference . . . . .88
hh.Failure to fulfil the duty to support . . . . . . . . . . . . .89
ii.Division and consolidation
aaa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90
bbb. Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91
kk.Statute of limitations . . . . . . . . . . . . . . . . . . . . . . . . . .92
ll.Redemption sum . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93
d.Rights and obligations arising
from the beneficial interest
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94
bb.Distribution of beneficial interest
and substitute claims . . . . . . . . . . . . . . . . . . . . . . . . . .95
cc.Undue delay . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96
dd.Death and right of redemption . . . . . . . . . . . . . . . . .97
ee.Assertion of rights
aaa.Beneficiaries’ rights . . . . . . . . . . . . . . . . . . . . . .98
bbb. Rights of the trust enterprise . . . . . . . . . . . . . . .99
ccc.In the case of an organisation . . . . . . . . . . . . . .100
ddd. Exceptions, etc. . . . . . . . . . . . . . . . . . . . . . . . . . .101
e.Register of beneficiaries
aa.Obligation to keep a register and examination . . . .102
bb.Registration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103
cc.Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104
– 12–
§§

2.Designation of the beneficiaries
a.In the case of no directive or inadequate directive
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
bb.Interpretation rule, etc.
aaa. With regard to the beneficiaries . . . . . . . . . . . . .106
bbb. Concerning the beneficial interest shares . . . . .107
b.Special system of succession in the
case of family trust enterprises
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108
bb.Interpretation rules . . . . . . . . . . . . . . . . . . . . . . . . . . .109
cc.In the case of several family trusts . . . . . . . . . . . . . . .110
c.Right of nomination and right of conferment
(patronage of beneficial interest)
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .111
bb.Public announcement . . . . . . . . . . . . . . . . . . . . . . . . .112
cc.Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .113
d.Security documents conerning the trust
beneficial interest
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .114
bb.Registration in the Trust Register . . . . . . . . . . . . . . .115
cc.Consequences of an irregular issuance . . . . . . . . . . .116
dd.Form and content
aaa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .117
bbb. Special data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118
3.Tracing of beneficiaries
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .119
b.Content of the summons . . . . . . . . . . . . . . . . . . . . . . . . .120
c.Statement of forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . .121
4.Alienation, charge and transfer
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .122
b.When other assent is needed and its substitution . . . . .123
5.Organisational matters
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124
b.Consultation
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .125
bb.In the case of special types of
entitlements or obligations . . . . . . . . . . . . . . . . . . . . .126
cc.Deposited proposals . . . . . . . . . . . . . . . . . . . . . . . . . .127
c.Family resolutions
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .128
bb.Convening, submission to Trust Register, etc. . . . . .129
cc.Right of participation . . . . . . . . . . . . . . . . . . . . . . . . .130
dd.Public citation proceedings (official tracing) . . . . . .131
ee.Passing and approval of the resolutions . . . . . . . . . .132
d. Involuntary co-operative society . . . . . . . . . . . . . . . . . . .133
– 13–
§§

V.Creditors of the participants
1.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .134
2.Creditors of the settlors . . . . . . . . . . . . . . . . . . . . . . . . . . . .135
3.Creditors of the Beneficiaries
a.Non-withdrawability (protective trust)
aa.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .136
bb.Special cases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .137
b.Withdrawability
aa.Possession of beneficial interest . . . . . . . . . . . . . . . .138
bb.Reversionary interest . . . . . . . . . . . . . . . . . . . . . . . . .139
c.Right of entry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .140
J.Responsibility
I.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .141
II.Trustee responsibility
1.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .142
2.Special cases of liability
a.In the case of co-trustees . . . . . . . . . . . . . . . . . . . . . . . . .143
b.In the case of succeeding
and resigning trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . .144
III.Responsibilities of the beneficiaries . . . . . . . . . . . . . . . . . . . . .145
IV.Responsibilities of third parties as
constructive trustees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .146
V.Release from responsibility
1. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .147
2. Statute of limitations
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .148
b.In the case of rights of recourse . . . . . . . . . . . . . . . . . . . .149
VI.Securing and preventive measures
1.Directive of the Register Office . . . . . . . . . . . . . . . . . . . . . .150
2.Liability insurance and right of refusal . . . . . . . . . . . . . . . .151
3.Periodical auditing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .152
4.Lodging of security, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . .153
K.Official supervisory and auditing trust office
I.Official supervisory trust office
1.Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .154
2.Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .155
3.Rights and duties
a.In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .156
b.Relationship to the other trustees
aa. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .157
bb.Participation in the appointment
of trustees, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .158
cc.Regarding trust assets and yield . . . . . . . . . . . . . . . . .159
4. Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .160
– 14–
§§

II.Official audit
1. Appointment and removal of auditors . . . . . . . . . . . . . . . .161
2. Rights and duties
a. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .162
b. Audit report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .163
3. Reference . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .164
L.Amendment of the trust instrument, conversion and merger
I.Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .165
II.Conversion and merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .166
III.Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .167
IV.Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .168
V.Withdrawal of approval and declaration of nullity . . . . . . . .169
M.International law and trust enterprises subject to foreign law, etc.170
Twentieth Title
Business Accountancy
Art.
A.Observance of accounting regulations
I. In general . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1045
II.Beginning and end . . . . . . . . . . . . . . . . . . . . . . . . . . . .1046–1046
A
B.Rules concerning inventory and balance sheet
I.Duty to prepare inventory and balance sheet
1.Opening inventory and balance sheet,
annual inventory and balance sheet . . . . . . . . . . . . . . . . . . .1047
2. Description of opening inventory
and annual inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1048
3. Fixed dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1049
4. Currency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1050
II.Balance sheet principles for the annual balance sheet
1. Completeness of the annual balance sheet . . . . . . . . . . . . .1051
2. Individual items . . . . . . . . . . . . . . . . . . . . . . . . . . . .1052–1059
III.Winding up balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1060
IV.Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1061
C.In general
I.External form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1062
II.Obligation to preserve . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1063
II.Obligation to declare . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1063A
III.Obligation to submit, law of evidence and
exclusion of levy of execution and writ . . . . . . . . . . . . . . . . . .1064
IV.Duty of disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1065
D.International law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1066
Right of appeal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1067
– 15–
§§

– 17 –
Second Part
The Legal Entities
(Juridical Persons)
Third Title
General Provisions
Art. 106
The incorporated associations of persons (corporate bodies
or corporations) and the establishments including foundations
which are devoted to a specific object or purpose and are in-
dependent shall acquire the right of legal personality through
registration in the Public Register (incorporation), that is, in the
absence of deviating provisions of law, even if the preconditions
of entry did not in fact, exist, subject to the procedure of voida-
bility.
Registration is not required for the corporate bodies and es-
tablishments under public law, for the societies which do not
pursue an economic object such as that which exists in the opera-
tion of a business which pursues commercial objects, for ecclesi-
astical foundations, for family foundations and where the law
provides an exception otherwise.
Art. 107
Associations of persons and fund donations whose economic
objects are the conduct of trade, the manufacture of goods or the
conduct of other commercial business may, insofar as the law
does not allow an exception, only acquire the right of legal per-
sonality as companies with legal personality (company limited by
shares, partnership limited by shares, Anteilsgesellschaft
1), private
company limited by shares, registered cooperative society, regis-
tered mutual insurance association or registered relief fund) or as

1) See Art. 375.
A. Legal Person-
ality
I. Preconditions
1. Re
gistration
2. Purpose and
ob
ject

– 18 –
an establishment and where the legal personality has not been
acquired and the preconditions for another form of legal entity do
not exist shall be subject to the provisions concerning the unreg-
istered partnership.
Companies with legal personality and establishments may also
be formed for the pursuit of objects which are other than com-
mercial.
Where the law refers to legal entities which are regarded as equal
in status to companies with legal personality, all other legal enti-
ties whose main object is to undertake commercial activities shall,
in the absence of legal provisions to the contrary, be deemed to be
included with these. In particular, investment and administration
of assets or the holding of participations or other rights are not
commercial activities unless the type and size of the undertaking
render necessary the facilities of a commercial business and or-
derly accounting.
1)
Otherwise, the objects of the business may be all kinds of
transactions for economic or other purposes and the articles may
cite these, in general or in particular.
Associations of persons and establishments, including foun-
dations whose objects are immoral or unlawful, may not, by vir-
tue of the law, acquire the right of legal personality.
Art. 108
In the event that action is undertaken on behalf of a legal en-
tity without or prior to the said legal entity having acquired legal
personality, liability shall rest with the persons that have
so acted in particular founders or persons that have already
been designated as bodies or the participants who pass resolutions
at assemblies, pursuant to the provisions concerning the unregis-
tered partnership and subject to the right of recourse against the
persons otherwise participating.
A person who has not acted personally shall be liable only if
according to the circumstances it must be assumed that that per-
son granted an agent authority to act.

1) Art. 107 par. 3, second sentence inserted by the law of 15 april, 1980, LGBl. 1980,
No. 39.
II. Absence of the
same

– 19 –
Those persons, who as a result of their acts, with or without
the power of agency, have become unrestrictedly liable, may be
released from this liability by the legal entity within three months
of it acquiring legal personality, provided the obligation entered
into by the person acting was expressly on behalf of the legal
entity to be formed and the said legal entity appears competent to
assume its undertaking pursuant to the law or the articles and to
acquire this legal personality.
After assuming this legal personality, only the legal entity shall
be liable to the creditors, subject, however, to the special provi-
sions concerning contributions in kind and acquisitions in kind
and concerning tortious acts.
Where assets are transferred to a person for the purpose of
forming a legal entity, the said person is in doubt subject to the
provisions concerning the implied
1) trust relationship.
Art. 109
The legal entities are by virtue of the law eligible for all
rights in the same manner as natural persons, in particular, prop-
erty rights, the right to the use of a name or the right of honour,
the rights of membership, of participation in firms and all obliga-
tions insofar as these rights or obligations do not have the natural
circumstances or characteristics of man, such as sex, age, relation-
ship by blood, as a necessary precondition.
With this restriction, the provisions which apply to natural
persons are therefore also applicable to legal entities.
Within this intendment, the legal entities may, through their
governing bodies appointed to represent or their representa-tives,
under their name or under their firm’s name, appear before all
court and administrative authorities and in all proceedings as
party, intervener, the person summoned, participant or in a simi-
lar capacity for their rights and effect entries in public registers
such as Land Register, Public Register, Patents Register and the
like and demand the protection of the law.

1) See annotation 3) to Art. 898.
III. Le gal ca pacit y

– 20 –
By the virtue of the law, each member may, if necessary, at his own
expense, appear as intervener, participant or as a summoned person for
one of the parties at the legal entity’s law cases. Where, however,
the law acknowledges member minorities as parties, only mem-
bers belonging to this minority may intervene in a dispute of the
minority.
Art. 110
The legal personalities are capable of acting as soon as the in-
dispensable bodies required for this pursuant to the law and the
articles have been appointed.
The internal regulations (by-articles), the memorandum of as-
sociation, the formation deed (foundation deed) and the like shall,
within this intendment, also be valid as articles, insofar as a devia-
tion does not ensue from the individual provisions.
Art. 111
Natural persons, legal entities and firms may be appointed as
members of a body.
The bodies are appointed to carry out the legal entity’s wishes
and intentions.
They commit the legal entity, without regard to their compe-
tence and subject to the right of recourse against the suspected
party and to the special provisions concerning the liability of the
principal by virtue of the law, not only by the conclusion of legal
transactions but also by their conduct, insofar as this constitutes
the undertaking of their representational activity or took place on
the occasion of and when the opportunity was presented by the
representational activity.
Within the limits of their legal capacity and their capacity to
act, the legal entities are responsible, moreover, subject to a possi-
ble right of recourse against the suspected parties, for criminally
tortious acts which a body or another representative appointed
pursuant to the articles has committed in the exercise of their
representational activity.
IV. Capacity to act
and for torti-
ous liability
1. Precondition
2. Activity
a. In
general

– 21 –
Where a legal entity or firm is a governing body or a represen-
tative of another legal entity, the represented legal entity or firm
shall be directly entitled and committed as the result of the repre-
sentational activities of their bodies and persons entitled to repre-
sent, subject to a possible right of recourse against the suspected
parties.
The persons acting are, moreover, personally responsible for
their inadmissible, culpable conduct and, if the preconditions of
the foregoing paragraph are applicable, the legal entity or firm
entitled to represent is also responsible.
Art. 112
Where the law or the articles do not determine to the contrary,
the subject of the resolution shall be stated when a multiple-
member body is convened.
In the absence of other provisions, the resolutions of a multi-
ple-member body shall be validly passed by a simple majority of
the countable votes.
Countable votes shall be deemed to be those which in individ-
ual cases are represented and have taken part in the voting and are
not excluded from the right to vote.
Where the law or the articles do not determine to the contrary,
resolutions of the bodies may also be passed by written assent to a
motion put forward (resolution by circular letter) if a member of
the body does not demand verbal deliberation.
Art. 113
Where their articles do not determine to the contrary, the
domicile of the legal entities shall be situated at that place where
their administrative activities are centred, subject to the provisions
concerning domicile in the international relationship. By virtue of
the law, the domicile of the legal entity is placed, under private
law, in the same category as the residences of private individuals.
In addition to their domiciles, legal entities may have one or
several branch establishments.
b. Passing of
resolutions
V. Domicile and
legal venue
1. Domicile

– 22 –
Art. 114
Subject to special legal provisions, the competent courts and
administrative authorities for legal entities shall be those which
have jurisdiction at the legal entities’ place of domicile.
For disputes between a legal entity and the members of the le-
gal entity from within the membership and for creditors’ claims
arising from the responsibility or because of dissolution or the
like, the legal venue by virtue of the law shall be, insofar as the
law does not provide an exception as, for instance, in the case of
legal entities subject to foreign law, the court having jurisdiction
at the place of domicile of the legal entity, even if in addition a
court of arbitration is provided in the articles.
Foreign legal entities owning a branch establishment in
Liechtenstein may be held responsible by virtue of the law for all
claims at the place of this branch establishment and a special
bankruptcy procedure (branch bankruptcy) may be executed for
the branch establishment.
1)
For litigation arising from accountability, the Liechtenstein
judge shall be competent in all cases where it is a question of
a domestic legal entity or a branch establishment or when the
defendant has a domicile or registered office in Liechtenstein.
1)
Art. 115
Legal entities enjoy the same protection of personality as natu-
ral persons insofar as a curtailment does not emanate from the
restriction of their legal capacity and their capacity to act or from
the nature of the relationships.
In particular, they are protected in their right to the name, the
company name, marks, honour, the inviolability of letters, busi-
ness and other secrecy worthy of protection.
Where a legal entity conducts a firm, the firm’s admissibility
and change of name shall conform with company law and the
otherwise valid legal regulations or as laid down in the articles.
The change of name of a legal entity not entered in the Public
Register shall conform analogously with the provisions drawn up

1) Para. 3 and 4 inserted by the law dated 30. October 1996, LGBl. 1997, No. 19.
1. Legal venue,
etc.
VI. Protection of
personalit y

– 23 –
for the firm name without, however, any obligation to register
insofar as the articles do not determine to the contrary, subject to
the prohibition concerning unfair competition.
Art. 116
Insofar as the law does not determine to the contrary,
written or otherwise produced articles shall be required for the
formation of a legal entity.
Where a public notarised deed is prescribed by law for the
articles, this shall apply only with respect to the content of the
articles necessary on the occasion of the formation of the legal
entity. The written form (internal regulations) shall be sufficient
for all other provisions.
Where the law does not allow an exception, the legal entity
must be designated in the articles as an association, a company
limited by shares, a partnership limited by shares, an Anteils-
gesellschaft
1), a private company limited by shares, a registered
co-operative society, a registered mutual insurance association or
a registered relief fund, an establishment or a foundation.
Insofar as a corporate body institution is necessary or in-
tended, this must be set forth in the articles in a manner which is
in conformity with the law and the intention of the participants to
possess the legal personality must be made evident in a satisfac-
tory manner.
Where, apart from the case of the assembly of the supreme
body, a public notarised deed is prescribed for the articles, the
founders or members may also give their assent by signature at
various recordings and authentications which may take place at
different times and places.
The articles and their amendments shall in all cases be signed
by a founder or a member if there is no provision for exceptions
such as in the case of associations, co-operative societies or gen-
eral associations.

1) See Art. 375.
B. Formation
I. Articles
1. In
general

– 24 –
Art. 117
In the absence of mandatory provisions of the law and pro-
vided the articles do not lay down supplementary provisions re-
lating to the legal entity concerning, particularly, the governing
bodies, the relationship of the legal entites between themselves,
towards their members or third parties, the provisions of the law
which are not mandatory shall be applicable supplementally.
Provisions whose application is mandatory, either by virtue of
the law or otherwise, cannot be amended by the articles.
Apart from the fact that legal personality is acquired by entry
in the Public Register, even if the actual preconditions for this did
not exist, the defectiveness of a provision which conflicts with the
law is cured by registration only where provision is made for this.
Art. 118
Where entry in the Public Register is necessary in order to ac-
quire legal personality or such entry is demanded voluntarily, it
shall ensue at the domicile of the legal entity and the articles shall
be deposited for safe keeping in the Register Office files, with
details of the recordable facts or relationships and of the persons
who comprise the bodies of the administration and, if necessary,
the audit authority.
Notification to the Public Register shall be the responsibility
of the administration or the persons particularly entrusted there-
with at the time of formation.
Art. 119
Where in addition to its head office (domicile) a company with
legal personality has branch establishments such as a place of
business, a branch office with a degree of independence, which are
not merely agencies, they shall also be entered in the Public Reg-
ister at their actual places, with a reference to the entry of the
head office.
The notification shall ensue with the enclosure of an extract
from the Register or the like on behalf of the administration from
the persons entitled to represent pursuant to the articles.
2. Relationship to
the law
II. Entry in the
Public Register
1. Notification to
the Register
Office
2. Registration of
branch estab-
lishments

– 25 –
Where another legal entity conducts for its purpose a business
which pursues commercial objects, the said legal entity shall be
required to register its branch establishments.
Art. 120
Like the formation, every amendment to the articles, every
change in the appointments to the bodies which are required to be
stated at the time of registration and the dissolution must be re-
ported to the Public Register insofar as a duty to report exists or
an entry was demanded voluntarily and is admissible.
The same procedure shall be followed by the persons entitled
to sign for amendments to the articles as for the original articles if
they are changed. Publication of the amendment shall take place
only insofar as provisions contained in earlier announcements are
thereby changed.
Amendments and the dissolution shall be effective towards
bona fide third parties only from the time of registration and,
where applicable, of publication.
Where the amendment does not concern the points stated at
the time of the first notification, it shall be sufficient if the entry
refers to the document submitted to the Public Register or to the
declaration delivered concerning the amendment.
Art. 121
When a corporate body is formed, at least sufficient members
must be present in order to set up the administrative bodies inso-
far as the law does not permit an exception.
Where the number of members subsequently falls below the
minimum number, the dissolution of the corporate body shall not
ensue automatically as a consequence thereof.
Where, however, this state continues, so that as a consequence
the directives required by law or the articles can no longer be
issued for more than one year, the court, at the request of a mem-
ber or a creditor, unsatisfied or threatened with damages and
losses, shall, in extrajudicial proceedings, following the possible
hearing of participants, allow a reasonable period of time for the
3. Amendments
and dissolution
III. Number of
members

– 26 –
restoration of the lawful state and, if this does not occur, declare
by means of a ruling pursuant to the court’s legal force, the cor-
porate body to be dissolved.
Art. 122
In the case of a limited company (Aktiengesellschaft) and
other legal entities whose capital is divided into shares, the mini-
mum capital or minimum assets must be at least SFr. 50’000.–, and
in the case of the private company limited by shares (Gesellschaft
mit beschränkter Haftung) and legal entities whose capital is not
divided into shares, at least SFr. 30’000.–
1)
Minimum capital and minimum assets must be fully paid up or
contributed.
2)
If the mimimum own capital (minimum own assets) falls be-
low the prescribed sum, members or creditors may apply to the
court in extrajudicial proceedings for the dissolution of the com-
pany if there are important reasons for this or if the necessary
number of members is lacking.
Where the law refers to own capital, this is to be undertstood
as a numerical sum expressed in terms of money and where the
law refers to own assets as assets consisting of any property or
rights which are usually estimated in terms of money solely for
balance sheet or other purposes.
The provisions of this articles may be applied correspondingly
to the minimum sum or the minimum quota of a share.
To safeguard the acquisition of landed property and rights
entered in the Land Register, a note can be made in the Land
Register in favour of the legal entity.
If the minimum own capital (minimum own assets) falls below
the prescribed sum, members or creditors may apply to the court
in extra-judicial proceedings for the dissolution of the company if
there are important reasons for this or if the necessary number of
members is lacking.

1) Art. 122 para. 1, amended by the laws dated 21 December, 1954, LGBl. 1955, No.
2, and 4 June, 1963, No. 17, in the version of the law dated 11 July, 1974, LGBl.
1974, No. 51.
2) Art. 122 para. 2, amended by the law dated 21 December, 1954, LGBl. 1955, No.
2, in the version of the law dated 4 June, 1963, LGBl. 1963, No. 17.
IV. Minimum capi-
tal resources or
minimum own
assets and the
like

– 27 –
Where the law refers to own capital, this is to be understood as
a numerical sum expressed in terms of money and where the law
refers to own assets as assets consisting of any property or rights
which are usually estimated in terms of money solely for balance
sheet or other purposes.
The provisions of these articles may be applied correspon-
dingly to the minimum sum or the minimum quota of a share.
To safeguard the acquisition of landed property and rights
entered in the Land Register, a note may be made in the Land
Register in favour of the legal entity being formed.
Art. 123
The legal entities shall be dissolved:
1. pursuant to the law or the articles,
2. by resolution of the supreme body which, in the absence of
other provisions in the articles, shall be passed by two-thirds
of the votes as determined pursuant to the following subpara-
graph and concerning which, where the law makes additional
provision, a public document shall be drawn up,
3. by court judgment, where dissolution is demanded by a
wholly liable member, for important reasons related to the le-
gal entity, or by members who represent at least one-tenth of
the capital resources or the own assets (non-prescribed mone-
tary capital expressed in figures) of the legal entity or, where
such is not present, by at least one-tenth of the members in
order to avoid impending heavy damages and losses, after
making prior provision for possible losses. Instead of redemp-
tion, however, the judge may order other measures, such as
dissolution, the exclusion of the plaintiff members, under ob-
servance of the provisions concerning the reduction of the
capital resources, the sale of the membership shares in favour
of the plaintiff members and the appointment of an adminis-
trator,
4. by opening bankruptcy proceedings on grounds of insolvency
or over-indebtedness, insofar as the law does not determine
otherwise.
C. Termination
I. Reasons for
dissolution
1. In
general

– 28 –
The provisions concerning the lodging of security, the con-
solidation of several actions, the effect of the judgment and com-
pensation in the case of actions on grounds of voidability or the
rescission of resolutions of the supreme body shall be applied
analogously to the petition for judicial dissolution pursuant to
subparagraph 3.
Where a legal entity is dissolved for other reasons as, for ex-
ample, on grounds of notice to terminate by members or third
parties, pursuant to reservations in the articles, the provisions
concerning liquidation shall also be applicable, provided the law
does not determine otherwise.
In the event of the tacit continuation of a legal entity beyond
the time determined in the articles, one of the minority quoted in
the first paragraph under subparagraph 3, except for this right
being otherwise forfeited, may demand dissolution within six
months of the expiration, insofar as its redemption or exclusion
does not ensue at the discretion of the judge, under observance of
possible provisions concerning the reduction of capital resources.
Art. 124
Where the purpose or object of a legal entity is unlawful or
immoral, the legal capacity shall be taken away and dissolution
shall ensue without compensation
1. pursuant to administrative court action by the representative
of public law,
2. pursuant to the action of a participant or the representative of
public law in the due course of the law.
The directive for precautionary measures remains reserved in
every case, such as the suspension of the course of business, the
appointment of a sequestrator and the announcement of the said
sequestrator’s appointment, the seizure of books and documents,
assets and the like before the final ruling by the Government in
the application of administrative compulsion or, at the wish of the
applicant, by the Princely Liechtenstein Court of Justice in ex-
trajudicial proceedings.
2. On grounds of
unlawfulness
or immorality
of the purpose,
etc.

– 29 –
Where cancellation proceedings against a legal entity are
pending before one authority, cancellation proceedings may not
be initiated before another authority and if cancellation procee-
dings are pending before both simultaneously, the final decision
shall be made by the administrative court.
The dissolution action in the case of legal entities entered in
the Public Register may, upon application or ex officio, be anno-
tated in the Public Register, before or during the dispute, until the
case is finally closed.
As soon as the decision has become final and absolute, the
judge shall communicate with the Registrar ex officio for the
purpose of making an annotation. After liquidation has been car-
ried out, the entry shall be deleted automatically.
The foregoing provisions shall also be applicable where, be-
cause of its purposes or objects or means, a legal entity is a threat
to the security of the State.
Art. 125
Should the original or amended articles not contain the provi-
sions designated by the law as essential or should these be contra-
dicted by an instruction laid down in regulations, voidability
proceedings may be initiated insofar as the form, the defect in a
provision concerning notification to the members or third parties,
or the minimum number of members are not involved.
Every member of a legal entity and/or every other person in a
legal entity entitled to vote, the administration or the audit
authority may, through the Registrar, in extrajudicial proceed-
ings, after the legal entity’s bodies authoried to represent or also,
possibly, a legal advisor specially appointed by the Registrar have
ben granted a hearing, cause a reasonable period of time to be set,
amounting to not less than three months’duration from the date
of service, extendable if necessary, for the legal entity’s competent
body to remove the defect and if the said defect is not removed
within the set period of time, to effect dissolution by means of
legal action.
The legal entity may, through its competent bodies, at any
time, even during voidability proceedings, up to the time of final
3. On grounds of
important de-
fects in the
articles (void-
ability)
a. In
general

– 30 –
and conclusive decision, cure the defect by removal. If, however,
this cure is not effected until after the expiration of the period of
time mentioned in the previous paragraph, the legal entity shall
pay all the costs accruing to the opposing parties, notwithstanding
the legal entity’s right of recourse to the offenders.
In all cases the legal entity shall retain the right of legal per-
sonality up to the termination of its liquidation, which shall ensue
pursuant to the other provisions of this law, with reservation of
bankruptcy.
This shall apply particularly with respect to the position of
possible members and third parties.
Action can no longer be taken after the expiration of five years
from the drawing up of a provision designated as essential.
Art. 126
The action for voidability shall be taken against the legal entity
which is represented by the administration or by the possible
audit authority if the administration brings an action. If, however,
not only the members of the administration but also those of the
audit authority bring an action or if an audit authority does not
exist and another representative for the legal entity is not present,
the court, pursuant to the provisions of the code of procedure,
shall appoint a legal adviser for the proceedings.
Several actions shall be combined for simultaneous hearing
and judgment. The initiation of the action as well as the time of
the hearing itself may be published at the discretion of the court;
publication may also ensue in the manner determined in the arti-
cles for notices and, if such a provision is lacking, in the journals
intended for the publication of official notices and shall be anno-
tated ex officio in the Public Register.
Upon application by the legal entity, the court may order, be-
cause of the disadvantage threatening the legal entity, that the
plaintiff shall lodge a judicial bond which shall be determined at
the court’s absolute discretion. Otherwise, the provisions of the
Code of Civil Procedure concerning the judicial bond for the
costs of an action shall be applied analogously to the performance
and compensation of the said judicial bond.
b. Voidability
action

– 31 –
Conversely, the court may postpone in proceedings by official
order the excution of the contested provision if a threatening,
irretrievable disadvantage to the legal entity can be established by
preponderant evidence.
Any member of the legal entity or any other person in the le-
gal entity entitled to vote may join the proceedings as an inter-
vening party, on one side or the other, at the expense of the said
intervening party.
Art. 127
Upon receipt of information or of his own accord, the Regist-
rar may, ex officio, under the same preconditions as those obtain-
ing in the care of voidability action, order in extrajudicial pro-
ceedings, the cancellation of the legal entity without com-
pensation.
The Registrar shall first of all fix a reasonable period of time,
which shall amount to at least three months and may be extended
for important reasons, for the legal entity to submit a written or
minuted verbal statement and, pursuant to the factual situation,
remove the defect. The Registrar shall order the annotation of the
voidability proceedings in the Public Register if the legal entity is
entered therein.
Should the defect not be removed and a statement not be sub-
mitted and if meanwhile an action for voidability has not been
finally and conclusively decided, the informer and the legal entity
shall be summoned to a hearing to discuss the defects and a deci-
sion shall be made concerning dissolution.
Otherwise, the provisions relating to voidability shall be applied
analogously with respect to the proceedings and the decision.
Art. 128
Depending upon whether the decision pronounces or dis-
misses voidability, the effect of the decision shall operate for or
against all members and bodies of a legal entity, regardless of
whether they took part in the proceedings or not.
c. Proceedings ex
officio
d. Effect and
res
ponsibilit y

– 32 –
In the case of legal entities entered in the Public Register, the
decision pronouncing dissolution shall, provided he did not initi-
ate this, be communicated, ex officio or upon application, to the
Registrar for the purpose of entry and publication, insofar as the
entered provision was published.
If intent or gross negligence is involved the plaintiffs or in-
formers shall be liable to the legal entity, without restriction,
jointly and severally, pursuant to the provisions concerning tor-
tious acts, for all damages and losses arising from unfounded ac-
tion or information, insofar as the informer is not the representa-
tive of public law or insofar as another line of action does not
exist ex officio.
Art. 129
Unless the law, the articles or the competent bodies determine
to the contrary, the assets of a legal entity which is cancelled shall
devolve upon the state which, as universal successor, shall be li-
able for the indebtedness solely to the extent of the assets taken
over and in the same way as the bona fide owner.
Pursuant to the provisions concerning the implied
1 trust rela-
tionship, the application of the assets shall correspond as closely
as possible to the existing purpose and the former participants in
the cancelled legal entity may demand the said application
through administrative channels.
Where a legal entity is judicially cancelled because immoral or
unlawful purposes have been pursued, the assets, after liquidation
has been officially implemented, shall devolve upon the State for
discretional utilization, even though provisions determine other-
wise.
Art. 130
Insofar as the law does not determine to the contrary, the dis-
solution of a legal entity for reasons other than bankruptcy shall
result in the legal entity’s liquidation.
Where a domestic branch establishment of a foreign company
with legal personality is closed down, liquidation shall be imple-
mented in the same way as when a domestic company with legal

1) See annotation 3, Art. 898
II. Application of
assets
III. Liquidation
1. In
general

– 33 –
personality is liquidated, unless the Public Register Office allows
exceptions.
1)
Insofar as assets are present after the conclusion of the bank-
ruptcy of a legal entity, they shall also be liquidated, unless it is
resolved to continue the legal entity.
The procedure in the case of the liquidation of the assets of the
legal entity shall be pursuant to the following provisions, where
special provisions have not been drawn up for individual legal
entities or their application is partly excluded as in the case of asso-
ciations or foundations which are not entered in the Public Register
or where an obligation to keep books or account is lacking.
Where during the liquidation proceedings it is established that
the assets do not cover the liabilities towards third parties, the
liquidators shall suspend their activity and give notice to the court
for the purpose of initiating bankruptcy proceedings.
In the event that the application does not issue from all the
liquidators, the court, before initiating bankruptcy proceedings,
shall hear the members of the administration as well as the other
liquidators and if they are not of the same opinion, shall initiate
bankruptcy proceedings only if it is convinced of the over-
indebtedness.
Insofar as the law or the articles do not determine to the con-
trary, a legal entity may, with the assent of all members, without
being wound up, be converted into another legal entity or com-
pany with company name and in all cases the rights of third par-
ties which existed up to the time of conversion shall remain re-
served.
Art. 131
Where legal entities go into liquidation, they shall retain their
legal personality and use their existing company name, with the
unabbreviated subjoinder “in liquidation” until the liquidation is
implemented, towards third parties and among the possible mem-
bers.
Legal action may be taken against them under their existing
company name and execution may be demanded against them as

1) Art. 130 para. 1a inserted by the Law dated 10 April, 1928, concerning the Trust
Enterprise, LGBl. 1928, No. 6.
2. The state of
li quidation

– 34 –
long as, in the case of a legal entity entered in the Public Register,
the subjoinder “in liquidation” is not entered in the Public Reg-
ister, even, that is, if they have added the said subjoinder to their
signature on the filed documents.
The bodies of the legal entity, with the exception of the ad-
ministration whose powers as a body pass to the liquidation of-
fice, shall have the same powers during the state of liquidation as
before liquidation, with the restriction, however, effective by
virtue of the law, to acts such as those which, by their nature, may
be justified by the purpose of the liquidation.
An acquisition of membership shall no longer take place, how-
ever. The members shall nevertheless remain committed to the
performances, also during the liquidation, as, for example, to the
payment of membership shares which are not fully paid up, of
further contributions and the like which, by virtue of their pur-
pose, appear to be recurrently executable for the duration and the
state of liquidation and inasmuch as they serve to satisfy the
creditors or for adjustment between the members.
Art. 132
Liquidators of the legal entity are the members who manage and
represent, insofar as the liquidation is not transferred to other per-
sons, in the articles or by resolution of the supreme body.
The power of agency of such liquidators may be extended, re-
stricted or withdrawn by the supreme body or, if important rea-
sons exist, upon application by a member or other participant
and, in the case of legal entities without members, by the Regis-
trar in extrajudicial proceedings.
Instead of this, the Registrar may, upon application by the
creditors who represent at least one-third of all uncovered credit
balances, by representatives of professional organisations or the
Chamber of Commerce or, for important reasons, by members,
also order an official liquidation and have it implemented, under
his supervision or under that of a committee of creditors to be
appointed and subject to the appropriate provisions concerning
liquidation.
In the case of official liquidation, the court may order the dis-
continuance of all executions pending against the legal entity.
3. Liquidators
a. Due appoint-
ment and re-
moval

– 35 –
The provisions concerning the liquidators shall be applicable
analogously to the substitute liquidators.
Art. 133
Where the liquidators are not designated in the manner stated
or where the legal entity is cancelled because of the pursuit of
unlawful or immoral objects, they shall be nominated by the
Registrar in extrajudicial proceedings and in this case may be
removed only by the judge.
The registration of the official appointment or removal of
liquidators shall ensue ex officio.
In the case of bankruptcy, the trusteeship in bankruptcy shall
attend to the liquidation pursuant to the law relating to bank-
ruptcy. However, the bodies including possible liquidators of a
legal entity, insofar as dispositions concerning components of the
total assets are not involved, shall have the same status as before
the adjudication of bankruptcy.
In relation to the trusteeship in bankruptcy, the liquidators
shall have the status of a natural person as a bankrupt.
Art. 134
The provisions concerning the obligation to register, the notifi-
cation and the rights and obligations of the liquidators, which are
drawn up with respect to the general partnership, shall also be ap-
plicable to the legal entity, subject to the following provisions and
in the opinion that the notifications for the purpose of registration
in the Public Register shall ensue through the administration.
Every change in the appointment of liquidators and the termi-
nation of their power of agency shall be notified through the ad-
ministration.
Where the law does not determine to the contrary, the provi-
sions which apply to the administration shall also apply to the
liquidators, except however, the restraint of competition.
Liquidators who violate or neglect the obligations with which
they are charged pursuant to the law or the articles shall, after
dissolution of the legal entity, be responsible to the legal entity, at
all events to the members and the creditors of the dissolved legal
entity, for the damages and losses which have arisen, without
b. Official ap-
pointment and
status in bank-
ru
ptcy
c. Obligations
and responsibi-
lit
y

– 36 –
restriction, jointly and severally, in the same way as the bodies of
the legal entity.
Unless otherwise determined, the liquidators shall act collec-
tively and take decisions with a simple majority of votes.
Art. 135
Upon taking up office, the liquidators shall draw up a wind-
ing-up balance, in the preparation of which the administration
shall assist and make available all relevant records and business
papers.
The creditors who are known from the business records or in
other ways, whose abode can be ascertained, shall be requested by
special notification in this connection to register their claims;
notification to the unknown creditors for the purpose of regis-
tering claims shall be by public announcement in the journals
provided pursuant to regulations for announcements to third
parties and, in the absence of such a provision, in the journals
intended for official announcements, insofar as the Registrar in
extrajudicial proceedings does not permit any other kind of re-
quest or insofar as all creditors give their assent to such a request.
Simultaneously, they may petition the court for the discon-
tinuance of all executions.
At the request of the liquidators, the Registrar may, for im-
portant reasons, in extrajudicial proceedings, release the liquida-
tors from their obligation to notify and request the creditors to
register their claims, in which case the six-months’ waiting period
shall commence on the day the disslution was announced by the
Registrar.
The request pursuant to the foregoing paragraphs shall also be
made in the case of domiciliary undertakings.
Art. 136
The liquidators shall conclude current business, satisfy, as far
as the assets allow, the legal entity’s liabilities pursuant to the
provisions of the bankruptcy law concerning the ranking of
claims and realise the assets and, insofar as they are necessary in
order to cover the liabilities, collect the members’ performances
which are still outstanding.
4. Liquidation
activity
a. Drawing up of
the balance
sheet
b. Procedure

– 37 –
In the realisation of the assets, real estate or analogous rights
may, with the assent of the supreme body or another body em-
powered pursuant to regulations, also be disposed of by private
contract.
A balance sheet showing the net position on the assets and li-
abilities of the legal entity in liquidation shall be drawn up annu-
ally. During the liquidation, however, income may not be distrib-
uted and donations may not be made to the reserve fund.
Monies received, which are not necessary for the payment of
creditors, may be deposited at the Landesbank (the state savings
and loan bank) or, for important reasons, also in other ways or,
with the consent of the court in extrajudicial proceedings, the
monies may be applied for part payments.
Art. 137
Where known creditors have omitted to register, the amount
of their claims shall either be deposited judicially or paid out to
them without notification.
Likewise, an appropriate amount shall be deposited for the le-
gal entity’s obligations which are suspended and not yet due as
well as for the litigant obligations, insofar as the distribution of
the legal entity’s assets does not remain suspended until the legal
entity is disposed of or the creditors are provided with security
which is of the same standard as judicial deposition.
Where important reasons exist, a committee of creditors may,
upon the application of creditors, be appointed for the supervi-
sion of the liquidators and for the purpose of accelerating the
liquidation. The said committee of creditors shall be appointed by
a simple majority of the votes represented at a creditors’ meeting
convened under the chairmanship of the court and shall support
and supervise the liquidators and shall exclusively validate respon-
sibility towards the liquidators.
Art. 138
After the debts have been repaid, the assets of a dissolved legal
entity shall, where the members are entitled to certain shares and
insofar as they and not the legal entity itself are entitled to these
c. Safeguards for
creditors
d. Distribution of
the assets and
dere
gistration

– 38 –
and it has not been determined otherwise, be distributed among
the members in proportion to the amounts paid in on these
shares, but otherwise in case of doubt, per capita.
Distribution shall not be effected before six months have ex-
pired, calculated from the day on which dissolution was an-
nounced for the third time in the public journals intended for this
purpose, with the request to register claims or, insofar as
exceptions are not allowed, distribution shall ensue pursuant to
the Registrar’s order in extrajudicial proceedings.
A distribution before the expiration of these six months may
be allowed by the Registrar in extrajudicial proceedings where,
pursuant to the existing circumstances, danger to the creditors is
completely excluded.
After the termination of their activity, the liquidators shall ap-
ply to the Public Register for deregistration.
Deregistration may ensue already before the expiration of the
six-month ban.
Where the articles or the competent body do not determine to
the contrary, the liquidators, after the termination of the liquida-
tion, shall call the supreme body, insofar as such a body exists, for
the purpose of approving the final account and releasing the liq-
uidators. Where the resolution to release is unreasonably refused,
the liquidators may have the release determined by way of action
taken against the legal entity.
Art. 139
Where after the dissolution and its entry in the Public Register
it is found that there are further assets which are subject to distri-
bution, the Court of Justice shall, upon the application of partici-
pants such as members, creditors or ex officio, in extrajudicial
proceedings, undertake the distribution of the assets through
officially appointed liquidators, in order of rank pursuant to
bankruptcy law.
This provision shall apply analogously where a legal entity has
been dissolved as the result of bankruptcy and the supreme body
omitted to appoint special liquidators or it is resolved that the
legal entity shall continue.
5. Supplement-
ar y liquidation

– 39 –
Where undistributed assets of the legal entity still exist, a
creditor, insofar as he seeks his satisfaction solely from these,
cannot be opposed by the period of prescription (statute of limi-
tations) which commenced after distribution.
Art. 140
In the absence of a deviating provision in the articles, the as-
sets may, pursuant to the provisions concerning a resolution to
dissolve, be transferred as a whole and the resolution shall result
in the dissolution of the legal entity, insofar as this has not already
been resolved or the alienating transfer of the entire assets ensues
in order to pay off creditors.
In the absence of any other legal disposition, the contract of
alienation shall require the simple written form and the transfer of
the assets to the acquiring party shall be executed pursuant to the
provisions applicable to the transfer of the individual asset com-
ponents.
The provisions concerning liquidation shall be applicable in
the sense that the liquidators shall also be empowered to under-
take those transactions and lawful acts necessitated by the re-
solved alienation. However, the transfer of the assets to the
transferee shall ensue solely subject to the observance of the pro-
visions drawn up for the distribution of the assets among the
members.
Art. 141
Where a legal claim is asserted against a deregistered or other-
wise terminated legal entity as the result, for example, of pro-
ceedings being reopened or of an action for annulment, the court,
upon application by the participants, shall appoint a legal adviser
for the dissolved legal entity, who shall represent the participants
in the proceedings. The provisions concerning the administrator
ad litem (Prozesspfleger) shall apply analogously with regard to
the legal adviser’s costs.
The appropriate provisions relating to liability shall be reser-
ved for the liability concerning the unjustified withdrawal of
liquidation shares.
6. Alienation of
the assets as a
whole
IV. Assertion of
claims against a
dissolved legal
entit
y

– 40 –
Where successors in title or other persons (firms, legal entities)
incur liability for the debts of the legal entity deregistered in the
Public Register and the period of prescription has not com-
menced, they may be held responsible as joint litigants in addition
to the legal entity or separately, individually or together, subject
to their liability.
Art. 142
The business records and business papers of a company with
legal personality which has been wound up, or of a legal entity on
the same footing shall, at the expense of the total assets, following
the liquidators’ application, be deposited for safe keeping in a
place to be determined by the Register Authority for a period of
ten years and after the expiration of this period shall be used at
the discretion of the Register Authority.
Where a legal entity is wound up as the result of bankruptcy,
the trusteeship in bankruptcy shall, at the expense of the total
assets, issue the directive concerning storage.
Any person able to substantiate a legitimate interest by prima
facia evidence may be empowered by the Court of Justice in ex-
trajudicial proceedings to examine the said business records and
business papers as, for example, former members, successors in
title or creditors.
Art. 143
Where a commune (state or communes) has acquired the –
entire membership shares of a legal entity, such as shares and
shares in a co-operative society, the winding up of the legal entity
may be dropped even when the commune remains the sole mem-
ber of the legal entity without, however, the legal entity losing the
nature of a legal entity pursuant to private law.
The commune or the persons designated by it may then exer-
cise the functions of the entity’s various bodies.
In the case of the dissolution of the legal entity, the liquidation
may proceed in such a manner that the commune declares its
readiness to enter into all the obligations of the legal entity.
The provisions concerning the one-man legal entity remain re-
served.
V. The keeping of
business re-
cords and busi-
ness
papers
VI. Take-over by
the community
1. By acquisition
of the shares

– 41 –
Art. 144
Where a commune has taken over the assets of a legal entity in
their entirety, with assets and liabilities, only the commune shall
be liable towards the legal entity’s creditors after the assets have
been transferred.
Where, however, the members of a legal entity are not person-
ally liable for the legal entity’s indebtedness, the commune’s li-
ability when taking over shall, in the absence of any other provi-
sion, be limited to the assets taken over.
In the event that an entry in the Public Register ensues, the le-
gal entity’s liabilities shall be transferred to the commune ten days
after the publication of the take-over entry in the Public Register,
but otherwise immediately after the take-over.
The formation of a one-man legal entity is reserved.
Art. 145
The possibly necessary registration shall ensue jointly through
the competent representative of the commune and the legal entity
and the take-over agreement shall be enclosed.
The entry and publication may not ensue until after the liqui-
dation of the legal entity has been entered in the Public Register.
The implementation of the liquidation may be agreed in such a
manner that the commune pays out to the legal entity in liquida-
tion or its members either a certain sum or the surplus balance-
sheet assets from the legal entity’s assets.
Art. 146
Where a legal entity has been dissolved for the purpose of al-
ienating its assets as a whole, for the purpose of conversion into
another legal entity or by resolution of the competent body, the
body competent to dissolve the legal entity may, if the intended
purpose can no longer be achieved or is no longer envisaged and
distribution of the assets has not yet commenced, with the major-
ity required to amend the articles, resolve that the legal entity
shall continue to exist.
The same shall apply in the case where the legal entity is dis-
solved by the adjudication of bankruptcy, but the bankruptcy is
2. Take-over of
the assets and
liabilities
a. Effects
b. Procedure
VII. Continuation
of a dissolved
le
gal entit y

– 42 –
cancelled following the conclusion of a settlement agreement or
upon application by the trusteeship in bankruptcy, the com-
munity of creditors or the bankrupt or for another reason, insofar
as the capital or assets necessary for continuation pursuant to the
law are still available.
If the legal entity is entered in the Public Register, the body
committed to or responsible for applying for registration shall
also apply for the registration of the continued existence.
Art. 147
Except for the tacit condition of materialisation, the declara-
tion to join a legal entity with shares, as a member or otherwise to
participate in its assets, must be worded unconditionally, it shall
not contain any conditions, but a date shall be stated determining
the period for which the subscription or other declaration shall
remain binding.
The formalities for the acquisition of membership shall also
apply with respect to the preliminary agreements concerning this.
Conditional declarations may be taken into consideration at
the time membership is established only insofar as other binding
declarations concerning enrolment or participation exist in the
event of the non-occurrence of the condition.
Where the period of validity of a binding declaration of mem-
bership of a legal entity in the process of formation is not deter-
mined and is not established by the circumstances, the validity of
the declaration shall be limited to a period of six months.
Where in the law or the articles mention is made of the mem-
bers, membership of the legal entity shall be inferred and not that
of a body forming a board unless, in an individual case the intent
is different.
Art. 148
Unless the law determines to the countrary, a member’s decla-
ration of membership, after the legal entity has come into exis-
tence, by subscribing to shares and the like, cannot be contested
by a member on grounds of deficiency of intention (mistake,
deceit, the creation of fear) or by a creditor or heir on grounds of
discrimination. This also applies to the articles.
D. Membership
I. Joining
1. In
general
2. Rescission

– 43 –
Damage claims against those who are to blame for the defi-
ciency of intention, also the right of execution and other means of
rescission provided by law are reserved.
Art. 149
Where the law or the articles do not determine to the contrary,
legal entities may grant their members share rights for which, in
the absence of any other rule, the valid provisions for the cooper-
ative society shares of registered co-operative societies shall be
applicable with regard to rights and obligations in particular.
Where the law or the articles do not determine to the contrary,
the membership shall be indivisible, alienable and inheritable,
The transfer of the membership and the creation of a restricted
right in rem assigned to this shall ensue by written agreement
insofar as no securities exist concerning the membership and the
articles do not set up any aggravating provisions such as, particu-
larly, a right of pre-emption or the assent of governing bodies or
members.
To be valid in the event of the bankruptcy of a member, the
transfer, insofar as an order concerning the bankrupt’s estate is
contained therein, shall be subject to the consent of the trustee-
ship in bankruptcy.
Where doubt exists, the distribution of profit shall be in rela-
tion to a member’s payment of assets on membership shares.
Where the law dose not determine otherwise, legal entities
may issue dividend right certificates, with or without member-
ship, and the provisions concerning dividend right certificates
shall be applicable to these where a membership is not combined
therewith; otherwise, however, the provisions concerning divi-
dend shares relating to companies limited by shares shall be ap-
plied analogously.
The appointment of trusts with or without the issuance of
trust certificates relating to shares in the profit, liquidation sur-
plus and the like and the transmission of membership by virtue of
the law, are reserved.
II. Membership
shares
1. In
general

– 44 –
Art. 150
Securities concerning membership may be issued only insofar
as the law expressly allows this.
Where securities are issued in violation of this provision or
before the acquisition of legal personality, they shall be null and
void and the issuer and, insofar as they are to blame, the other
participants shall be liable to the bearers, without restriction,
jointly and severally for all the loss caused by the issuance, not-
withstanding the obligations and privileges resulting from joining
or possible subscription.
The provisions concerning shares as securities, in particular
those concerning the share certificate shall be supplementally
applicable to the other membership securities.
Art. 151
In the absence of other provisions of the law or the articles, a
legal entity may only acquire or take in pledge personal participa-
tions pursuant to the provisions concerning the acquisition of
own shares.
Furthermore, a legal entity may not appoint any trustees for
the participations owned by the legal entity for the purpose of
circumventing the law or the articles.
Where a legal reserve fund is prescribed, the fund may be in-
vested in the legal entity’s own participations, wholly or partly,
only with the assent of the Registrar.
The remaining provisions concerning the legal entity’s own
participations are reserved.
Art. 152
A membership participation to which several members are un-
dividedly entitled shall be represented by them jointly in law and
with respect to obligation.
If there has not been a dispute between them regarding the
membership participation, they shall be liable, jointly and sever-
ally, to the legal entity for the performances related to the mem-
bership participation.
Several members shall appoint a joint representative.
2. Securities con-
cerning mem-
bershi
p
3. Personal parti-
ci pation
4. Several partici-
pants

– 45 –
In the event that they fail to appoint a representative and to
notify the legal entity concerning this, expressions of intent may
be given to another member and the judge may appoint a joint
representative in extrajudicial proceedings.
Art. 153
Provided the articles do not determine to the contrary, mem-
bers with proprietary membership shares may appoint an actual
trust pursuant to the relevant provisions and, accordingly, trans-
fer to the trustee the shares for the restricted or unrestricted exer-
cise of the personal (territorial) rights arising from the member-
ship, in particular, the right to vote, under reservation of the pro-
prietary rights and obligations arising from the membership.
In the absence of other provisions in the trust deed, the trustee
shall deposit with the legal entity the securities handed over to
him against the delivery of trust certificates which shall be trans-
ferable in the same way as membership securities or in another
way in favour of the members (settlors).
Trust certificates having the characteristics of securities and
relating to proprietary claims arising from the membership may,
provided the articles do not forbid it, be issued by a member as
trustee or by a specially appointed trustee, even if the membership
is not connected with a security or is indivisible.
Art. 154
Insofar as there are no deviations resulting from the issuance
of several certificates for one membership or otherwise, the trust
certificate shall state the powers of the trust body from which the
performances relating to law of property and deriving from the
membership can be obtained and, furthermore, shall have the
same content as the deposited securities concerning membership.
By operation of the law, the deposited securities shall remain
non-transferable until trust certificates have been issued for them.
If, contrary to this provision, they are issued, the issuer and, inso-
far as blame attaches to them, the other participants shall be liable
to the bearer, without restriction, jointly and severally, for all loss
caused.
5. Trust certifi-
cates
a. In
general
b. Form and effect

– 46 –
The members are in the same position as other members with
regard to the obligation to the legal entity to perform; on the
other hand, in the absence of other provisions in the trust deed,
only the trustee can assert the rights arising from the membership
or cause them to be asserted by others.
Where a trust exists, the assertion of claims arising from the
membership in the case of execution against the member or if the
said member is bankrupt is admissible only pursuant to the provi-
sions concerning the trust.
The creation of other trusts is reserved.
Art. 155
Established rights to which the members as such are entitled
may not be taken away from them or restricted without their
assent, not even by amendment of the articles, insofar as not all
equally entitled members are affected in the same way by the
deprivation or the restriction.
Insofar as the law or the articles do not determine to the con-
trary, where a member withdraws or is excluded without the legal
entity being dissolved and this member has a claim relating to
dissolution, settlement or similar, the determination of this claim
shall ensue on the basis of a liquidation balance drawn up for this
purpose whereby, however, the legal reserves shall be entered on
the liability side of this balance.
By operation of the law, each member shall be entitled to in-
spect and copy the articles and, where they are duplicated, to
obtain a copy in return for a reasonable payment.
Art. 156
Insofar as the law does not determine or allow any other ac-
tion and in the latter case this is stipulated in the articles, only the
assets of a legal entity are available for the said legal entity’s
creditors.
A liability or liability to effect further contributions on the
part of the individual members may therefore be determined in
the articles only where the law allows this and a joint and several
liability exists for them only where the law or the articles make
such provisions.
III. Established
and other
ri
ghts
IV. Liability and
liability to ef-
fect further
contributions
1. In
general

– 47 –
In the absence of other provisions, its assertion shall ensue by
way of the contribution procedure.
Where shares of the legal entity are held by the said legal en-
tity, liability and the liability to effect further contributions shall
be dormant for the duration of the possession, but so, too, shall a
possible option right to acquire new shares and in the absence of
other provisions in the articles the said option right shall be gov-
erned by the provisions relating to this as drawn up for companies
limited by shares.
Art. 157
Insofar as it might not be possible to satisfy the creditors in
bankruptcy owing to their claims to the assets of the legal entity
existing at the time of the adjudication of bankruptcy having to be
taken into account at the time of the later final distribution in
bankruptcy proceedings, members with liability or liability to
effect further contributions shall be liable to effect contributions
to the bankrupt’s estate in order to cover the deficiency pursuant
to the bankruptcy winding-up balance, namely, in the absence of
any other provision laid down in regulations, in proportion to the
sums involved in the liability or the further contributions where
limited liability or liability to effect further contributions is in-
volved, but otherwise per capita (contributed assets).
Where individual members, including the withdrawn members
liable to contribution pursuant to the law or the articles, are inca-
pable of effecting contributions owing, for example, to insolvency
or other reasons, these contributions shall be spread over the re-
maining members, insofar as this is not opposed by limited liabil-
ity or liability to effect further contributions.
After the creditors have been satisfied, voluntary payments,
made by the members in excess of the contributions owed purs-
uant to the foregoing provisions, shall be refunded right away
to the said members from the contributions and, if necessary, may
be asserted by means of a calculation of additional contributions.
Insofar as the preconditions exist under which a member as
creditor in bankruptcy may claim satisfaction on grounds of a
claim arising out of the contributions, a member may set off
against the contributions a claim on the legal entity.
2. The contribu-
tion procedure
a. In
general

– 48 –
Where, pursuant to individual provisions of this law, the con-
tribution procedure is applicable outside the bankruptcy pro-
ceedings, the administration and/or the liquidators shall take the
place of the trusteeship in bankruptcy on the understanding that
the powers and obligations to which they are otherwise entitled
pursuant to the provisions concerning the contribution procedure
shall be dropped.
Art. 158
Immediately following the adjudication of bankruptcy, the
trusteeship in bankruptcy shall compute, based on the winding-
up balance which has been produced, the contributions to be
effected by the members by way of advances in order to cover the
deficit shown in the balance sheet and in this case the various con-
ditions relating to liability and liability to effect further contribu-
tions where groups of members are involved, as, for example,in
the case of mixed cooperative societies, shall be taken into consid-
eration.
All members, with name (firm’s name) and domicile, shall be
quoted in the computation together with the contributions allot-
ted to them and the extent of the contributions shall be assessed in
such a manner that a deficiency in the total amount to be covered,
resulting from a predictable inability on the part of individual
members to effect contributions, regardless of whether it is de-
termined judicially or not, shall not occur.
Art. 159
Upon petition of the trusteeship in bankruptcy, the Court of
Justice, in expedited extrajudicial proceedings, shall declare by
adjudication, which is no longer voidable by litigation, the com-
putation to be enforceable by execution.
For this purpose, the court shall immediately order a public
court hearing for the purpose of explaining the computation to
the participants. To this court hearing shall be summoned the
members quoted in the computation and/or their successors in
title, the members of the administration and/or the liquidation
b. Computation
of advances
aa. In
general
bb. Writ of execu-
tion

– 49 –
authority, the audit authority if applicable, the trusteeship in
bankruptcy and, in the event that the community of creditors has
appointed a committee of creditors or similar, these members also
and these shall be heard briefly, without evidence actually being
taken.
It shall be stated in the public announcement and in the sum-
monses that the computation shall be accessible for examination at the
court registry one week before the court hearing.
The court shall adjudicate concerning the objections raised,
correct the computation if necessary or order it to be corrected
and finally rule that the computation is enforceable by execution.
At the same hearing or at a court hearing ordered specially,
pursuant to the second paragraph, to which those who partici-
pated in the first hearing may be summoned orally, the adjudica-
tion shall pronounce and simultaneously explain that the compu-
tation, with the adjudication declaring enforcement by execution
which shall not be served, shall be accessible at the court registry
for examination by the participants.
Art. 160
After the computation has been declared enforceable by exe-
cution, the trusteeship in bankruptcy shall collect the contribu-
tions from the members without delay.
The enforcement of execution against a member shall ensue
pursuant to the existing applicable provisions by reason of a copy
of the adjudication to enforce by execution which shall be served
upon the member together with an excerpt from the computation
from which at least the total deficit, the name (the name of the
firm) of the member and the amount allocated to the said member
shall be evident.
The forms of legal redress, such as actions, complaints and the
like, against an enforceable title, to which the member as debtor
in the execution proceedings is entitled, shall remain unaffected.
The collected contributions shall be deposited at the Landes-
bank or at another place to be determined by the trusteeship in
bankruptcy or the committee of creditors.
cc. Execution

– 50 –
Art. 161
Each member and/or the member’s successor in title may
challenge by way of action against the trusteeship in bankruptcy
the computation declared enforceable by execution and the adju-
dication, with the petition to rescind the computation of con-
tributions and the adjudication enforceable by execution against
the said member because, for example, the said member is no
longer a member, the computation does not conform with the
legal provisions or the provisions laid down in regulations or the
winding-up balance is incorrect or because not contributions, but
other payments are demanded, and the like.
The rescission shall take place only within the strict time limit
of one month from the pronouncement of the adjudication and
only insofar as the plaintiff asserted the grounds for rescission at
the time of the court hearing concerning the declaration of en-
forceability by execution or, through no fault of his, the plaintiff
was unable to assert by action in court because, for example, the
grounds did not come into being until after the hearing or of ig-
norance of the law.
The oral hearing in the proceedings to rescind shall not take
place before the expiration of the strict time limit and several
actions for rescission shall be combined for simultaneous hearing
and adjudication.
Upon petition and against the possible deposit of a security,
concerning which the provisions relating to the safeguarding of
the costs of an action shall be applied analogously, the court may,
during the litigation, suspend the execution or direct that en-
forcement measures be rescinded.
The final and conclusive judgment shall be effective for and
against all members liable to pay contributions, regardless of
whether they appeared in the proceedings as intervening parties
or not.
After the expiration of the unused strict time limit of one
month, membership for the members entered in the members’
register shall be deemed to be finally and conclusively determined
for the contribution procedure.
dd. Action in res-
cission

– 51 –
Art. 162
Insofar as the total amount to be covered is not achieved ow-
ing to the inability of individual members to effect contributions
or pursuant to the judgment pronounced in an action to rescind
or for other reasons the computation is required to be amended,
the trusteeship in bankruptcy may draw up a supplementary
computation.
If necessary, the drawing up of the supplementary computa-
tion shall be repeated.
The foregoing provisions concerning the computation of ad-
vances, the writ of execution, the execution and the action to
rescind shall be applicable to the supplementary computation.
Art. 163
As soon as the final distribution, pursuant to the provisions of
the bankruptcy law, is commenced, the trusteeship in bankruptcy
shall determine as a supplement to and correction of the advance
computation and of the supplementary computation, handed
down to the said trusteeship in bankruptcy, how much in contri-
butions, pursuant to the valid provisions, still has to be effected
by the members including the costs of the bankruptcy and contri-
bution proceedings, insofar as the members, possibly as the result
of proceedings concerning advance payments, have not already
been held liable to the limit of their liability or liability to effect
further contributions.
The last paragraph of the previous article shall be applicable to
the computation of the further contributions, on the under-
standing that contributions shall not be apportioned to the mem-
bers whose inability to effect contributions becomes evident.
Apart from the other assertion, right of recourse by virtue of
membership, arising from the liability or the liability to effect
further contributions, may also be asserted by means of computa-
tion of further contributions.
Art. 164
After the possibly necessary computation of further contri-
butions has been declared enforceable by execution, but otherwise
after the computation of advances, the trusteeship in bankruptcy
ee. Supplemen-
tary computa-
tion
c. Computation
of further con-
tributions
d. Distribution of
the contributed
assets

– 52 –
shall immediately distribute to the creditors, by way of subse-
quent distributions and pursuant to the provisions of the law
concerning bankruptcy, the existing balance of contributions and
whenever a sufficient amount has been received from the con-
tributions still to be collected.
Apart from the dividends in bankruptcy allocated to the
claims designated pursuant to the bankruptcy law which are to be
retained, the shares allocated to claims which were contested by
the trustees in bankruptcy or the liquidators in the proceedings
concerning the claims of the creditors in bankruptcy shall be re-
tained.
It is left to the creditor in bankruptcy to eliminate, with effect
for the contributed assets, the administration’s and/or the liqui-
dators’ protest against the legal entity, by bringing action against
the legal entity within a period of one months since the contesta-
tion. However, insofar as the protest is declared finally and con-
clusively well founded the shares are free to be distributed be-
tween the other creditors of the assets paid in as additional capital.
The creditors and the trusteeship in bankruptcy not taking ac-
tion may intervene in a dispute concerning the protest.
Where voluntary payments by the members or third parties do
not have to be reimbursed beforehand, the surpluses not required
for paying off creditors shall be repaid to the members by the
trustees in bankruptcy in proportion to the amount of contribu-
tions effected.
Art. 165
In the absence of other directives, the provisions of the code of
obligations concerning the consequences of default shall be ap-
plied in general to default in the case of performances in kind by
the membership as, for example, in the case of subscriptions in
kind or other additional performances which do not consist of
money and a liability exists solely for the person who has under-
taken to perform in such a manner.
For the subscription in kind subscribed to the capital resources
or own assets, the legal entity, after its formation, may, by virtue
of the warranty, on grounds of defects pursuant to the principles
of the contract of purchase, claim a right to a reduction and com-
V. Default in the
performance
in kind, exclu-
sion of the sett-
lement, of the
right of reten-
tion, etc.

– 53 –
pensation for damages, but not rescission and, if the subscription
is quite worthless, claim that the subscription be effected in
money.
An offset or a right of retention on an object belonging to the
legal entity cannot be asserted against a claim by the legal entity
arising from the obligation of a member to pay on capital shares
or from any other obligation as a member to contribute or liabil-
ity to make further contributions.
The objection that a counter-performance is possibly unful-
filled cannot be raised where another performance in the form of
a subscription in kind is legally due.
Where bodies are to blame for delaying or preventing the
withdrawal of a member and the member suffers loss in conse-
quence, the members of the body concerned shall be liable in the
first place and the legal entity subsidiarily.
Art. 166
In the case of legal entities with membership, the meeting of
the members shall be the supreme body insofar as the law or the
articles do not determine otherwise, as in the case of delegate
meetings, the passing of resolutions by circular letter and similar.
The articles may transfer the authority of the meeting of
members, completely or partly, to a committee comprised of
members or non-members or to a council of members which is
elected by the entirety of the members at the members’ meeting
or at the section or department meetings provided in the articles,
which are separated locally according to professional or other
aspects (representative constitution).
Where there is no provision to the contrary or nothing ensues
by virtue of the nature of the matter, the same conditions as those
applicable for the meeting of members, including minority rights,
shall be applicable for these committee or section or department
meetings.
In the case of legal entities without members which have a su-
preme body, the provisions analogously applicable to the latter
shall be those drawn up for the supreme body in the case of cor-
porations unless otherwise provided.
E. Governing
bodies
I. Supreme body
1. In
general

– 54 –
Art. 167
The supreme body shall be convened by the administration
(chairman), the liquidators or, by virtue of the law, by the repre-
sentatives of the loan creditors or other bodies authorised pursu-
ant to the articles, or their individual members or third parties
and, for the duration of bankruptcy proceedings, also by the
trusteeship in bankruptcy as frequently as required by law or the
articles or as necessary in the interest of the legal entity. In the
event of undue delay causing risk, the audit authority may also
summon the supreme body.
In the case of companies with legal personality and the legal
entities granted the same status as such companies, the supreme
authority shall be called at least once each year, insofar as in the
case of legal entities with less than twenty members each resolu-
tion is not passed by way of circular letter or insofar as the articles
do not expressly determine the ordinary meeting of the supreme
authority once and for all with respect to time, place and the
statement of agenda.
Where the law does not determine otherwise, the form of con-
vocation, whether orally, in writing or by public announcement,
may be determined in more detail in the articles and these should
state the place, time and purpose of the meeting in detail when it
is intended to amend the articles, particularly the essential content
of the amendments. Where, however, the law or the articles do
not determine otherwise, each meeting shall be announced at the
domicile at least one week in advance in the journals intended for
public announcements.
With the exception of the resolution concerning the chair-
manship and the keeping of minutes, the motion proposed at the
meeting of the supreme authority to call an extraordinary meeting
and the instituting of an examination of the management and the
appointment of those commissioned to undertake this, resolutions
may not be passed concerning subjects whose deliberation has not
been announced in the manner required by law or the articles
(agenda).
Prior announcement is not required for the proposal of mo-
tions and for deliberations concerning which resolutions will not
be passed.
2. Convocation
a. In general

– 55 –
Should all members or representatives be assembled and no
entitled person objects, they may, without observing the other-
wise prescribed formalities for convening constitute an assembly
of the supreme authority and within the same lawfully confer and
pass resolutions concerning subjects within their competency
(universal meeting).
Art. 168
Convocation of the members’ meeting shall ensue if demanded
by the representatives of at least one-tenth of the countable votes;
if less than thirty countable votes are present, when demanded by
at least three votes with statement of purpose submitted in a peti-
tion signed by the petitioners.
Should the competent body unreasonably deny this demand,
the convocation may ensue upon petition of the members entitled
to vote and, after the hearing of the members of the adminis-
tration, by the Registrar in extrajudicial proceedings with the
simultaneous appointment of a chairman and, moreover, com-
pensation may be claimed against the suspected bodies on
grounds of their contractual relationship, possibly pursuant to the
provisions concerning tortious acts.
Art. 169
In the absence of provisions to the contrary, members or other
persons entitled to vote may be represented by such or by third
parties with written authoriation.
The legal representatives, the representatives as laid down in
regulations and those representing a firm who represent those
persons of a legal entity who are incapable of acting must be al-
lowed to participate in negotiations and the passing of resolutions
without special powers of agency, even if the articles do not allow
representation or only by others entitled to vote.
Those incapable of acting as, for example, drunken persons,
may be excluded from the meeting.
If they are not members of the legal entity the members of the
audit authority may participate in an advisory capacity.
b. Minority
ri ghts
3. Partici
pation

– 56 –
Within the scope of the law, the articles may determine to
what extent non-members such as bond holders and the like are
authorised to participate in the deliberations and voting.
A register (attendance list) signed by the chairman shall be
kept of the participants who attended or who were represented at
the meeting of the supreme body of a company with legal person-
ality and of the votes they cast. The said register shall be displayed
during the meeting.
Art. 170
Unless the law or the articles determine to the contrary, the
supreme body shall be entitled to those powers which are drawn
up for registered cooperative societies; in particular, it shall super-
vise the activity of other bodies and rule on the competence of the
bodies.
Voting may take place either at the meeting or, where notarial
anthentication is not prescribed for the resolutions, without a
meeting, by means of ballot boxes or, in the case of legal entities
with less than twenty members, in such a manner that instead of
the meeting of the supreme body, the expressly formulated reso-
lutions are sent by registered letter to the persons entitled to vote
and the minimum number of persons entitled to vote, necessary
for the passing of a resolution, return their written assent.
The provisions applicable to the voting shall also apply to the
ballot.
Pursuant to the provisions concerning minority rights, a mi-
nority may demand, by means of a signed petition to be submit-
ted to the administration or the body otherwise summoned at
least five days before the meeting is due to take place, that speci-
fied subjects be placed on the agenda for discussion and the pass-
ing of resolutions.
Where the laws or the articles do not determine otherwise, the
rules concerning parliamentary negotiations shall be applicable
for the chairing of the meeting, the deliberation and the passing of
resolutions.
4. Authority and
passing of
resolutions
a. In
general

– 57 –
Art. 171
Unless the articles determine to the contrary, a member
elected by the meeting shall preside over the meeting on each
occassion.
It shall be incumbent upon the administration to ensure that
minutes of the meeting are kept and these shall report briefly but
in sufficient detail on the deliberations, resolutions and votes. The
administration shall also give the necessary instructions concern-
ing the formalities for voting and the determination of voting
rights.
In the absence of any other rule determined by the articles or
the meeting, the minutes of the meeting shall be kept by a mem-
ber and signed by the chairman of the meeting and the keeper of
the minutes.
Each person entitled to vote shall be allowed during business
hours to examine the minutes and, upon demand, obtain a copy of
same.
Art. 172
In the absence of any provisions to the contrary, the resolu-
tions, in order to be valid, shall require the assent of the simple
majority of the present, countable votes and at least one-tenth of
all votes must be represented, insofar as the judge, upon petition
by the administration, does not, for important reasons, allow an
exception in extrajudicial proceedings.
Where the law does not determine to the contrary, as in the
case of multiple voting rights or proportional representation, each
member shall have one vote.
Bond holders or lenders, with or without a claim to convert
their right of creditor’s title into a right of membership, may be
conceded in the articles a more closely defined right to vote, for
which the provisions relating to the exercising of the rights of
members to vote shall be supplementally applicable whereby,
however, the entirety of such voting rights may comprise at the
most half of all the votes, but the assent of at least three quarters
of all the votes shall be required in the event that more than one-
third of all the voting rights are conceded.
b. Chairing and
keeping of
minutes
c. Required
majority
aa. In
general

– 58 –
Should the membership be combined with a security, the ma-
jority, where doubt exists, shall be computed according to the
number of shares; where doubt exists at delegate meetings, how-
ever, each delegate shall be accorded one vote.
The articles may also determine that individual groups of
members or shares shall have different voting rights; in such cases,
however, each member must have at least one vote.
Where the law or the articles prescribe that a minimum of
votes shall be present for the passing of a resolution and where an
insufficient number of votes is represented at a first meeting, this
resolution, concerning the same subjects, may be passed, regula-
tions to the contrary reserved, with a simple majority at a second
meeting to be convened within an appropriate period, which shall
be at least eight days, regardless of that minimum number, if
nothing to the contrary is determined.
In the event of parity of votes, the chairman shall have the
casting vote.
In particular, the foregoing paragraph shall be applied an-
alogously if resolutions may be adopted by circular letter.
Art. 173
Where in a legal entity there exist members or shares having
different rights or obligations as, for example, preference shares,
ordinary shares or restricted and unrestricted liability or liability
to effect further contributions, those who are equally entitled or
equally liable form a party between themselves in litigious pro-
ceedings and special groups (categories) when voting takes place,
insofar as their rights or obligations are influenced dissimilarly by
the resolution to be passed and for such a resolution to be validly
passed it is necessary to have the assent of all groups required for
an amendment of the articles unless, with the approval of the
Register Authority, it is regulated differently in the articles.
In the absence of other provisions in the articles, these special
meetings shall be called by the administration and chaired by a
participant elected by the meeting. Otherwise, the provisions
bb. Special entitle-
ments and obli-
gations

– 59 –
concerning the supreme body shall be applicable analogously.
In the absence of other directives in regulations, the provision
contained in the previous article shall be applicable to the passing
of resolutions.
Where the dissimilarity in the right to vote exists essentially in
a dissimilar number of votes, only a joint resolution shall be
passed and the dissimilarity in the right to vote shall be taken into
consideration.
Art. 174
Where the articles do not determine to the contrary, they may
be amended with the approval of three-quarters of all those pres-
ent at the meeting of the supreme body, representing at least half
of all the shares; in the event that the latter are not present, the
approval of all members shall be required.
Insofar as it is not determined to the contrary, new obligations
for the members to perform may be substantiated or increased
only with the approval of the members, otherwise a resolution
shall be valid only if it is not contested.
Amendment of the internal regulations (by-articles) shall re-
quire merely the written form, even if such provisions were
drawn up in an authenticated deed.
Amendments of the articles shall be drawn up within the same
scope as the original articles and, if necessary, authenticated and
entered in the Public Register.
The execution of the amendments which concern only the
wording may, by resolution of the supreme body, be transferred
to another body.
An amendment of the articles does not exist where, pursuant
to the law relating to firm names, a clearly distinguishable sub-
joinder is added to the firm name of a branch establishment.
Art. 175
Notwithstanding the right of participation in the meeting and
the discussion, each person entitled to vote shall be excluded from
the right to vote, in the said person’s own name or in the name of
another by virtue of the law, in the case of the passing of a reso-
cc. Article
amendment
d. Exclusion from
ri
ght to vote

– 60 –
lution concerning a transaction or litigation between the said
person, the said person’s spouse, betrothed or a person related in
the direct line on the one hand and the legal entity on the other or
the passing of a resolution concerning a transaction or litigation
between a third party and the legal entity from which a person
entitled to vote derives personal advantage or disadvantage.
Own shares in the possession of the legal entity do not confer
the right to vote and do not belong to the countable votes. The
right to vote, however, may be exercised by the legal entity ap-
pointed as the trustee.
In the case of resolutions concerning the release of the admini-
stration with regard to management and accounting, the persons
who participated in the management in any way shall not, by
virtue of the law, have voting rights.
A resolution contravening these provisions may be rescin-
ded pursuant to the provisions concerning the rescission of reso-
lutions of the supreme body.
These restrictions shall not be applicable to legal entities with
less than thirty persons entitled to vote, to members of the audit
authority, in the case of elections and removals or where, in ex-
trajudicial proceedings, the Registrar allows an exception other-
wise.
Art. 176
Where a restricted right in rem attaches to a membership right,
only the member or the trustee who is on the same footing is
entitled to vote, under reservation of representation.
Where securities relating to the membership are in existence,
the bearer of the title is bound to enable the right to vote to be
exercised with the said title insofar as the immediate restitution of
the unchanged title is ensured after the exercise of the right to
vote.
Where a right of membership is being used, only the member
has the right to vote. However, the member shall obtain the as-
sent of the usufructuary for all resolutions which constitute un-
usual acts on the part of the administration, and in the event of
infringement of this obligation the member shall be liable for
damages.
c. Right to vote in
case of usu-
fruct, pledge
and other ri
ghts

– 61 –
The voting right for the deposited securities (deposit vote)
may be asserted by the depositary only provided the said depo-
sitary has special authority to do so, granted by the depositor,
insofar as the law does not allow exceptions, as in the case of trust
deposits, for example.
In the absence of a deviating provision or agreement, the exer-
cise of other personal (territorial) rights arising from the member-
ship shall be deemed to be equal to the right to vote.
This provision shall be applied analogously to other rights to
vote.
Art. 177
Concerning the resolutions of the supreme body which relate
to the constitution, the amendment of the articles and the disso-
lution of a legal entity, an authenticated document shall be drawn
up in all cases where membership exists as a proprietary share or
such recording is otherwise required by law, unless the law itself
provides an exception as, for example, in the case of cooperative
societies, small insurance associations and establishments or in the
case of recording by circular letter.
The authenticator must be present in person when the reso-
lution is passed and, stating the place and time of the meeting, must
keep minutes which record accurately and briefly the resolutions
passed as well as the occurrences and statements which took place
or were made in the authenticator’s presence and were of signifi-
cance for the appraisal of the regularity of the proceedings.
The minutes must be signed by the chairman of the meeting
and by a person designated as the keeper of the minutes.
Insofar as the prerequisites for this exist and it is specifically
demanded, a confirmation in the minutes of the identity of the
chairman and other persons present at the meeting may also be
considered to be adequate.
If need be, the founder’s draft of the articles, the declarations
of membership, the signed subscription prospectus, the articles
approved by the members’ meeting and similar shall be appended
to the authenticated deed.
In all cases, the authenticated deed may be replaced by a decla-
ration signed by all the participants and authenticated.
f. Official recor-
ding of resolu-
tions

– 62 –
Art. 178
The administration and, insofar as it does not initiate action it-
self, the audit authority of the legal entity may contest before the
judge at the domicile by means of action, cross action, plea or
interlocutory or final decision within summary proceedings
against the legal entity resolutions of the supreme body or of
another body which contravene the provisions of the law or the
articles.
Where the subject matter of the resolution is a rule whose im-
plementation would render the members of the administration or
the audit authority liable to prosecution or render the creditors or
members of the legal entity liable, each member of the admini-
stration and the audit authority may, by virtue of the law, contest
it or refuse to implement it.
Furthermore, in the case of legal entities with members, with
reservation of the provisions concerning established rights, the
representatives of at least one-twentieth of all votes, but at least
three votes and where there are less than ten votes or members,
each vote or each member may, by virtue of the law, cause a
resolution to which they have not given their assent to be con-
tested and rescinded. Under these circumstances, the judge, with
appropriate application of the provisions of the Code of Civil
Procedure concerning the lodgment of security for the costs of an
action, may require security, and in the event of failure to observe
this requirement the claim to rescind shall no longer be admitted.
In the same way, individual persons entitled to vote may,
where, contrary to law or article, they have not been summoned
to meet or their participation in the meeting or the voting has
been made impossible in another way or rendered more difficult
in an inequitable manner and as a result of this have not partici-
pated in the meeting or the voting or, in the case of a resolution to
be adopted by circular letter, persons entitled to vote have voted
against the resolution or have been circumvented or, finally,
where unauthorised persons have taken part in the passing of a
resolution, whether an objection has been raised or not, cause a
resolution to be contested and rescinded if, at the same time, they
are able to substantiate by prima facie evidence that this defect
had an influence on the resolution passed.
5. Rescission of
resolutions
a. In
general

– 63 –
Where an irretrievable disadvantage threatening the legal en-
tity is substantiated by prima facie evidence, the court may post-
pone the contested resolution in mandatory proceedings.
Art. 179
The right of rescission of the persons entitled to vote lapses if
the said persons fail to announce their intention to bring action
within one month of the passing of the resolution or, in the event
that the articles provide for a special rescission procedure fail to
announce this to the administration immediately following the
exhaustion of the administrative channels and bring the action
before the judge within a further month at the latest of the passing
of the resolution.
In the event that the contested resolution is entered in the
Public Register, the judgment shall, upon demand of the con-
testants, be entered in the Public Register in amendment of the
earlier entry and published, if this is necessary.
The judgment declaring annulment shall be binding on all per-
sons of a legal entity entitled to vote.
The plaintiffs acting negligently by initiating the action against
the resolution of the legal entity shall be liable for all the losses
arising from unfounded contestation, pursuant to the provisions
concerning tortious acts, without restriction, jointly and severally.
The provisions concerning action for voidability shall be ap-
plicable supplementally to the action to rescind.
Otherwise, resolutions may also be rescinded ex officio by the
Registrar pursuant to the provisions as drawn up ex officio in the
case of voidability.
Art. 180
Each legal entity must have an administration, (board of di-
rectors, managers and the like) which, in the absence of provisions
to the contrary, may be comprised of one or several natural or
juridical persons or firms and be appointed by the supreme body
from members of the legal entity or third persons for a period of
three years and the members of the administration may be re-
appointed and remunerated or not.
b. Assertion of
liability for da-
ma
ges, etc.
II. Administration
1. In
general

– 64 –
Subject to the provisions concerning the participation of the
community, the articles may also concede to other third parties,
such as loan and mortgage creditors or non-profit making under-
takings, the right to appoint individual members of the ad-
ministration or its board of directors (bound administration).
Where during the course of a business year individual mem-
bers from an administration comprised of several members cease
to be members or are prevented from participating in the man-
agement, the remaining members may, insofar as the articles do
not determine to the contrary, continue to manage and represent
until the next meeting of the supreme body.
The current members of the administration or other persons
authorized to sign and the termination or an amendment of their
authority to represent shall, in the case of legal entities entered in
the Public Register, be registered without delay and the proof of
appointment as, for example, an extract from the minutes, shall be
appended, insofar as a re-appointment is not involved.
The provisions drawn up for the members of the administra-
tion are also applicable to their possible representatives when they
act, or should act, as such.
A special administration may not be appointed for a branch
establishment, but, however, a special representative as authorised
signatory.
Unless the law or the articles determine otherwise, manage-
ment shall also embrace the authority to represent.
The articles may declare applicable the provisions concerning
the board of directors in the case of companies limited by shares.
Art. 180a
1)
At least one member of the administration of a legal entity
authorised to manage and represent must be a Liechtenstein citi-
zen domiciled in the Principality of Liechtenstein and be in pos-
session of the professional licence to act as lawyer, legal agent,
trustee or auditor, or a government-recognised business qualifi-
cation.

1) Art. 180a inserted by the law dated 4 June, 1963, LGBl. 1963, No. 17 reformu-
lated by the law dated 15 April, 1980, LGBl. 1980, No. 39.

– 65 –
On the same footing are persons resident in Liechtenstein
(foreigners require permission to settle) who possess a govern-
ment-recognised certificate of qualification which corresponds to
one of the requirements laid down in para. 1, whose fixed, main
employment is with a lawyer, legal agent, trustee, auditor or a
juridical person with licence to act as trustee or auditor, or with a
bank, and pursue their activity within the intendment of para. 1,
within the framework of this employment.
Excepted from the obligations pursuant to para. 1 are:
1 Legal entities which, on the basis of the law concerning trade,
have a qualified manager,
2 Legal entities which pursue an activity in Liechtenstein which
does not fall within the scope of application of the trade law.
By means of an Executive Order the Government may assign
to a government office, for independent settlement, the issuance
of confirmations relating to the recognition of business qualifica-
tions, with reservation of recourse to the Government’s collegial
jurisdiction.
1)
Art. 181
If nothing to the contrary has been determined or the compe-
tent body has not ruled in a resolution, all members of the admi-
nistration shall be entitled to manage.
Where the administration is comprised of several members and
the articles do not determine to the contrary, no member alone
shall execute an act which appertains to management if danger
due to delay does not exist.
Where pursuant to the articles or a regulation based on these
each member of the administration is entitled to manage alone,
the execution of an act pertaining to management must be left
undone if one of the members objects to the execution of the said
act, in the case that the articles do not determine otherwise.
Actions vis-a-vis third parties, however, remain unaffected.

1) Para 4 of Art. 180a inserted by the law dated 16. December 1994, LGBl. 1995,
No. 25.
2. Management
a. In general

– 66 –
Art. 182
The administration shall have all the authority and obligations
which are not transferred to or reserved for another body as, for
example, the vesting and retraction of the power of “Procura”,
i.e., of signature rights; in particular, the administration shall also
be concerned with the preservation of the capital resources and/or
the legal entity’s own assets in the case of legal entities whose
capital resources are not required to be expressed as a sum of
money as well as with the security and success of the undertaking.
It shall conduct and promote the legal entity’s business un-
dertaking with care and shall be liable for the observance of the
principles of careful management and representation.
The administration shall receive from the founders all the
written documents relating to the formation of the legal entity.
The administration shall be under obligation to the legal entity
to observe all restrictions which are determined by law, articles,
resolutions of the competent body or in any other way.
Unless determined to the contrary, the administration of a le-
gal entity shall be entitled to the same authority and obligations as
the administration of a registered cooperative society.
Art. 183
Where the articles do not determine to the contrary, the mem-
bers of the administration of companies with legal personality
which pursue commercial objects and of other legal entities whose
status is equal to these may not, without the consent of the su-
preme body or, in the absence of a supreme body, without the
approval of the judge in extrajudicial proceedings, either effect
transactions in the line of business for their own account or for
the account of third parties or participate as a partner or member
with unlimited liability or occupy a position in the administration
or the audit authority in a company without legal personality or
in a legal entity in the same line of business.
The consent may be expressed in general terms in the articles.
Furthermore, the said consent may be assumed where, on the
occasion of the appointment as member of the administration of
the legal entity such an activity or participation was known and
its termination was nevertheless not expressly required.
b. Authority and
obli gations
c. Restraint of
com
petition

– 67 –
Members of the administration who infringe the restraint
stated in the first paragraph may be removed at any time without
obligation to compensate. Moreover, the legal entity may demand
compensation for damage or, instead of this, demand that the
business effected for the account of the member of the admini-
stration be deemed to have been concluded for its account and,
regarding the business concluded for the account of others, de-
mand the surrender of the emolument obtained for this or the
assignment of the claim for emolument.
The rights of the legal entity referred to in the foregoing lapse
three months from the day on which the other members of the
administration and, if members do not exist, the members of the
audit authority gained knowledge of the substantiating fact and in
all cases after the expiration of one year.
Other contractual arrangements, such as the agreement not to
compete, etc., are reserved.
Art. 184
The representation of legal entities ensues through the bodies
appointed for this purpose or other special representatives pursu-
ant to the regulations in the articles. The administration does not
require a special power of agency provided, for example, by law.
The performance of the legal entity’s transactions as well as
the representation of the legal entity in this business activity may,
where the administration is comprised of several members, also be
transferred to individual members or other authorised repre-
sentatives or employees of the legal entity.
Legal entities or firms may also be appointed as bodies
authorised to represent or manage, as board of directors or as
administration or as a member or other representative of such.
The authorised representatives or managing persons of the said
legal entities or firms shall then execute for them, insofar as
special delegates are not appointed for this, all the negotiations of
the bodies and the representatives.
Where the law does not otherwise determine to the contrary,
the administration has the status of a legal representative.
3. Representation
a. In general

– 68 –
The legal entities not entered in the Public Register are re-
quired, following a request from the Registrar, in order to avoid
the administrative penalty admissible in the Public Register pro-
ceedings, to make known their members of the administration (of
the board of directors) appointed to represent.
1)
Art. 185
A legal entity shall be deemed to be in bad faith if one of the
persons acting as body or representative is in bad faith or if an
authorised representative in bad faith fails to draw the competent
persons’ attention to the defect.
The provision of the foregoing paragraph shall be applied
analogously where the judgment of the knowledge, of the fault or
of loyalty and good faith of the legal entity is involved.
The members of the body entitled to represent take oaths, af-
firm to the judge, etc., on behalf of the legal entity in the same
manner as a party.
In the case of the bankruptcy of the legal entity, the members
of the administration have the same obligations to the Bankruptcy
Office as a natural person when bankrupt and the administration
shall protect their rights against the trusteeship in bankruptcy.
Art. 186
Upon the conclusion of transactions by the legal entity in
which a member of the administration is interested as, for exam-
ple, upon the conclusion of transactions with the member himself,
this person may not, by virtue of the law, participate, except in
the case of urgency.
Where as a result of this a valid resolution cannot be passed,
the transaction shall be referred to the audit authority or, in the
absence of an audit authority, to another body determined in the

1) Art. 184 last para. (= para. 5 ) inserted by the law dated 10 April, 1928, concerning
the Trust Enterprise LGBl. 1928, No. 6.
b. Position as party
c. Exclusion

– 69 –
regulations and, if such a provision is lacking, to the supreme
body, which shall entrust one or several specially authorised
agents with the representation of the legal entity or deal with the
transaction itself.
This provision shall not be applicable where deviating provi-
sions are contained in the articles, in the case of legal entities
having less than thirty members or in the event that the audit
authority approves the transaction, in which case, however, the
audit authority must report to the next meeting of the supreme
body concerning this matter.
Art. 187
The bodies as well as the other persons appointed to manage
and represent totally are authorised by virtue of the law to con-
clude on behalf of the legal entity all transcations with bona fide
third parties which may promote the purpose or object of the
undertaking.
Third parties may also be legal entities or firms in which the
legal entity participates as member.
In respect of this definition and also with regard to the mean-
ing of the restriction of their power of agency in the relationship
with the legal entity and bona fide third parties, the bodies and
the persons mentioned are subject to the provisions drawn up for
the general partnership, insofar as special provisions do not exist.
The transactions which they undertake shall be deemed to be
valid for the legal entity even if they do not ensue expressly in the
name of the said legal entity, but the circumstances pertaining to
their execution indicate that they are undertaken on behalf of the
legal entity in accordance with the intentions of the participants.
The authority to represent of persons (firms) not appointed
for total management and representation shall be in accordance
with the authority assigned to them. In case of doubt, it shall
extend to all lawful acts which are usually associated with the
execution of such transactions.
d. Power of agen-
cy of the bodies
and repre-
sentatives

– 70 –
Art. 188
The articles of all legal entities should determine the manner in
which the administration shall declare its intentions, who is
authorised to sign and, where several are authorised to sign, who
shall sign validly with sole and who with collective signature
rights.
In particular, the articles may determine that a member of the
administration comprised of several members is authorised to sign
validly only in combination with an authorised signatory; how-
ever, this circumstance must be notified to the Public Register,
entered therein and published.
Where the law or the articles do not determine to the contrary
and the administration is comprised of several members, the par-
ticipation and the signature of at least two members shall be re-
quired for the representation of the legal entity and for valid sig-
nature on behalf of the said legal entity. However, also in the case
of joint management and representation, expressions of intent as,
in particular, summonses and other processes served upon the
legal entity shall be validly served when served upon only one of
the members entitled to represent or a representative.
Art. 189
Where an entry has been made in the Public Register, certifi-
cation provided by the Register Authority signifying that the
persons designated therein are entered in the Public Register as
members of the administration is sufficient evidence of the auth-
ority of the administration as far as public authorities are con-
cerned. On the other hand, for legal entities that are not entered
in the Public Register, proof of identity is required concerning the
appointment by the competent body as, for example, minutes of
the meeting or a notarised copy or excerpt.
Where the law does not allow an exception, signing shall be
effected in such a manner that the signatories shall add their name,
by their own hand, to the name of the firm or the legal entity.
Where another legal entity or firm is entitled to sign on behalf
of a legal entity or firm, it shall be sufficient if the signature is
signed in such a manner that the representative of the former adds
e. Execution
f. Evidence of
authority and
si
gnature

– 71 –
his signature, by his own hand, to the name of the legal entity or
firm represented.
Art. 190
Where an existing legal entity temporarily lacks the required
managing bodies or the bodies authorised to represent or, in ad-
dition, a legal representative with this anthority or where the
persons forming the administration are not known or, in the indi-
vidual case, the representatives are excluded from the representa-
tion and where management and representation has not been
taken care of in another manner, the court, upon application by
the participants and at the expense of the legal entity, shall ap-
point a legal advisor in extrajudicial proceedings insofar as the
interests of the legal entity, its members or creditors or the public
demand this.
The legal advisor shall convene the body responsible for the
appointment without delay and, by virtue of the law, all the
authority exercised by the lacking bodies or representatives shall
be exercised by the said legal advisor.
The provisions concerning the creation and dissolution of legal
entities are reserved.
Art. 191
Upon application by members and at the discretion of the
judge, management and representation may, against the provision
of security for possible loss, be temporarily withdrawn from the
body of a legal entity by the appointment of a legal advisor, pro-
vided it can be substantiated by prima facie evidence that the said
body endangers the interests of the legal entity and that danger is
imminent.
Except in the case where a legal advisor is appointed solely for
individual items of business as, for example, in the case of legal
representation in court, the suspension of representation and
management as well as the appointment of a legal advisor shall, in
the case of legal entities entered in the Public Register, be noted in
the Public Register with a statement concerning the legal advisor
and his authority to represent and, at the discretion of the Regis-
ter Authority, published.
4. Appointment
of a legal advi-
sor
a. In
general
b. Withdrawal of
management and
re
presentation

– 72 –
Art. 192
The supreme authority may appoint one or several auditors as
audit authority who are not required to be members of the legal
entity and may neither belong to the administration nor be em-
ployees of the legal entity assigned to the said administration and
shall exercise their authority and obligations pursuant to the law,
articles and possible resolutions of the supreme body, for or
without reward.
A special audit authority acting on its own responsibility may
be determined in the articles also for individual lines of business,
business departments or branch business establishments.
In addition to the participation of the community, the articles
may also concede the right to appoint individual members of the
audit authority or its chairman to other third parties such as loan
or bond creditors or non-profit making undertakings (bound
audit authority).
The Government may prescribe by way of ordinance that legal
entities which have issued bearer bonds without special cover or
whose capital resourses or own assets including the borrowed,
unsecured monies amount to at least SFr. 5 million be audited by
an approved or legally qualified firm of auditors.
1)
Where the audit authority is not appointed or is not complete
pursuant to the law or the articles, the court, upon application of
a participant in the legal entity, shall, in extrajudicial proceedings,
determine a three-month period of time during which the audit
authority shall be appointed or completed and should this period
of time elapse without the said audit authority being appointed or
completed, the court itself shall designate the required audit
authority members for the period until the appointment is made.
A legal entity which undertakes commercial activities or
whose purpose or object as laid down in regulations allows the
pursuit of commercial objects must appoint an audit authority
pursuant to para.
1)

1) Art. 192 para. 4 and 6 in the version of the Law dated 15 April, 1980, LGBl. 1980,
No. 39.
III. Audit
authority
1. A
ppointment

– 73 –
Art
. 193
In the case of companies with legal personality and legal enti-
ties on the same footing, the audit authority may not be ap-
pointed for longer than one year in the first instance and, later, for
not longer than three years.
If doubt exists, this latter duration shall be applicable to the
audit authority in the case of all legal entities.
Where representation before court or administrative authori-
ties is not involved or the articles do not determine otherwise, the
members of the audit authority may not transfer the exercise of
their obligations.
The provisions drawn up for the members of the audit auth-
ority shall apply analogously to their representatives where they
act or should act as such.
Insofar as exceptions are not determined, the audit authority
shall act towards third parties as a body and shall be represented
by its chairman.
Art. 194
Where an audit authority is appointed and the articles do not
determine otherwise, the said audit authority is empowered by
operation of the law to represent the legal entity with members of
the administration when transactions are concluded and, where
the members’ meeting does not appoint another authorised agent,
to conduct legal proceedings against present members of the ad-
ministration, concerning which the said members’ meeting shall
pass a resolution.
In proceedings against the members of the audit authority, the
legal entity shall be represented by special authorised agents
whom the supreme body shall appoint for the said proceedings.
In the absence of a provision in the articles to the contrary, the
audit authority shall be empowered, at its discretion in the event
of apprehended danger, temporarily to suspend from the manage-
ment and representation, or have suspended by the judge in ex-
trajudicial proceedings, members of the administration who are
not appointed by a legal entity under public law as well as
2. Position
a. In general
b. Towards the
administration
and the supre-
me bod
y

– 74 –
authorised signatories and other authorised agents until a decision
has been reached by the supreme body which must be summoned
without delay.
Art. 195
The balance sheets, inventories, profit and loss accounts and
other books of account of companies with legal personality and
other legal entities, insofar as the latter pursue commercial ob-
jects, shall, as far as possible, be examined by the appointed audit
authority with respect to regularity, accuracy and reliability and
to determine whether the financial situation and the business
result are presented correctly.
For this purpose, the audit authority may, as a body or
through individual members, demand that the books of account
and documentary material be submitted to it, that as far as possi-
ble it is called in for the inventory taking and that the administra-
tion explains certain individual items to it.
The audit authority may demand that certain subjects be han-
dled by the administration or placed on the agenda of the supreme
body for consideration and decision by resolution.
Art. 196
In the case of companies with legal personality, the audit
authority must report in writing to the supreme body concerning
the balance sheet and profit and loss account submitted to it by
the administration and, as far as possible, this report shall furnish
information concerning the following:
1. Whether, in the opinion of the audit authority, the balance
sheet and profit and loss account submitted to the supreme
body reflects the true economic position of the company,
2. whether the balance sheet and profit and loss account agree
with the books of account and the inventory,
3. whether the audit authority proposes to the supreme body that
the balance sheet and profit and loss account be approved, with
or without reservation, or be returned to the administration,
4. whether the audit authority agrees to the administration’s
proposals concerning the distribution of profits or whether it
recommends another method of distribution.
3. Duties
a. In general
b. Re
portin g

– 75 –
Where an audit authority is prescribed, the annual balance
sheet and profit and loss account may not be approved by the
supreme body before such a report has been submitted.
A minority identical to that which may demand that the su-
preme body shall be summoned has the right to draw to the no-
tice of the audit authority certain objects which require examina-
tion on the understanding that the audit authority shall report this
to the next meeting of the supreme body for the purpose of pass-
ing a resolution.
Art. 197
The audit authority shall draw to the attention of the body
immediately superior to the suspected person and, in important
cases, also to the supreme body, any irregularities or infringe-
ments of the provisions contained in the law or the articles which
come to the notice of the said audit authority in the performance
of its duties.
Outside the meeting of the supreme body, communications
from the auditors to persons other than members of the admini-
stration and the audit authority concerning the observations made
are save for other responsibility, inadmissible, pursuant to the
provisions concerning the right of privacy in particular.
Art. 198
Concerning the organisation of the audit authority, further
provisions for the expansion of the said audit authority’s powers
and obligations and in particular for the undertaking of interim
audits may be specified in the articles.
In addition to the ordinary auditors (audit authority), the su-
preme body may at any time appoint special inspectors or experts
to investigate the management or individual parts thereof.
Art. 199
In addition to the administration, the articles may also make
provision for a supervisory board which is appointed pursuant to
the provisions concerning the administration and may be assigned
c. Notification of
irregularities
and pledge of
secrec
y
4. Other provisi-
ons of the arti-
cles
5. Supervisory
board

– 76 –
the function of permanently supervising the management and
participating in the administration.
1)
The charge of responsibility may also be brought by the su-
pervisory board against the members of the administration.
The members of the supervisory board may, but are not re-
quired to be entered in the Public Register.
Art. 200
Where the law does not determine to the contrary, the articles
may also provide for other indirect or direct bodies such as man-
agement, committees and other representatives.
Where no other provision is made, the provisions concerning
the implied
2) trust and, supplementally, those concerning the
mandate or, insofar as remuneration is agreed or, depending upon
the circumstances, may be assumed, the contract of employment
shall be applicable to the relationship between the bodies and the
legal entity, insofar as the supreme body or the position of the
minorities or special categories of members is not concerned.
Art. 201
Where the law does not determine to the contrary or the arti-
cles do not entrust another body with this, the supreme body
shall be empowered at any time to remove the members of the
administration, the audit authority or other bodies as well as
other authorised agents or delegates appointed by the said su-
preme body.
The right to appoint a body, a member of such or an author-
ised agent includes the right to remove or give notice of termina-
tion to these and this shall occur by virtue of the law where
authorities make the appointment. In other cases, only insofar as
no other provision has been made.
This right to remove exists, contrary to conflicting provisions
in the articles, by virtue of the law where important reasons as,
for example, gross neglect of duty or inability to manage properly
justify such action.

1) Art. 199 para. 1 in the version of the law dated 15 April, 1980, LGBl. 1980, No. 392) See annotation 3) to Art. 898.
IV. Other bodies
and applicable
law
V. Termination
and removal

– 77 –
The administration may also at any time remove the com-
mittees, delegates, directors and other authorised agents they have
appointed and suspend the functions of the authorised agents
appointed by the supreme body, while informing the latter of this
suspension.
Possible claims for compensation by those removed, arising
from contracts, such as contract of employment or mandate or
from tort and the temporary suspension from management and
representation by the judge, are reserved.
Where the judge removes members or bodies, he shall, at the
same time order that a new appointment be made by the com-
petent bodies and, meanwhile, take appropriate steps pursuant to
the provisions concerning the appointment of a legal advisor.
Art. 202
Companies with legal personality and other legal entities, in-
sofar as the latter are engaged in commercial activities, are subject
to the following provisions and the provisions which are other-
wise drawn up concerning the commercial clearing system.
Insofar as it is required to state the capital resources (money
capital resources), determined numerically, in money, of an un-
dertaking, this may ensue in domestic or foreign currency and,
accordingly, the clearing system may be based on the appropriate
currency or another currency.
Where important reasons exist, the Government may deter-
mine by way of Executive Order in the case of undertakings other
than domiciliary undertakings that domestic money shall be em-
ployed for the money capital resources and/or the undertaking’s
own assets and for the clearing system, or that other deviating
provisions shall be applicable.
Art. 203
Unless important reasons justify an exception, the draft balance
sheet shall be submitted to the supreme body for approval within the
first six months of the succeeding business year.
F. Clearing
system
I. In
general
II. Annual bal-
ance-sheet
regulations
1. Date of balance

– 78 –
Legal entities with capital resources and/or own assets
amounting to at least one million francs as well as all those that
have issued bearer bonds are required to prepare a balance sheet at
least once every year.
Art. 204
The annual balance sheet shall express the relationship be-
tween the firm’s own means and liabilities and between the short-
term liabilities and the permanent maintenance of liquidity from
available means.
A balance sheet showing entries which on the balance sheet
date are below the value of the assets permissible pursuant to the
law as well as the investment by the administration of other hid-
den reserves is permitted within the frame of this law and the
articles in the interest of the most uniform distribution of profits
and for the consolidation of the undertaking.
Where in the time between the end of the business year and
the passing of a resolution by the meeting of the supreme body
concerning the closing of the accounts it comes to the notice of
the administration that the financial state of the legal entity is
considerably reduced, owing to losses which have occurred or as
the result of depreciation and the reduction is presumably not
merely of a temporary nature, the profit shown in the annual
balance shall, in the absence of deviating provisions in the articles,
be excluded from the distribution to the extent of the loss of as-
sets and transferred to the account of the current business year.
The articles may determine that profit in the form of an in-
terim payment on the profit to be shown in the annual balance
sheet may be paid out during the business year on the basis of an
interim balance sheet, or that the administration or another body,
without prior resolution of the supreme body, may at certain
times during the year distribute profits from profit balances
brought forward from previous years or from special reserve
funds.
Shares of a legal entity which are in the possession of the said
legal entity as, for example, shares of the latter’s capital shall, in
2. Balance-sheet
principles
a. In
general

– 79 –
the absence of other provisions laid down in regulations, be taken
into account when profit and other performances accruing from
the membership are distributed but not, however, with respect to
liquidation certificates.
Art. 205
Formation, organisational and administrative costs shall be
fully written off in the profit and loss account. By way of excep-
tion, however, organisational costs which are provided for in the
articles or in the resolutions of the supreme body, whether for the
original setting-up, for a subsequent expansion of the business or
for operational reorganisation and, in the same manner, stamp
duties, bank commissions and the like may be distributed over a
period of five years at the most in such a manner that an item is
entered on the assets side and each year at least the corresponding
fraction is written off.
Art. 206
Where economic or other circumstances make this appear im-
perative, the Government, by way of Executive Order, may order
the following additional balance sheet regulations for undertak-
ings other than domiciliary undertakings:
1. That in the case of legal entities concerned with participation
(subsidiary companies, associated companies and similar),
where more than one-tenth of the capital resources or the legal
entity’s own assets are invested in participations, the kind and
the amount of the securities shall be entered in the balance
sheet,
2. that in the case of investment, associated, controlling or hold-
ing companies the securities which the company intends to
hold permanently (participation account), in addition, those
which it is intended to dispose of as quickly as possible (secu-
rity transfer account) and, finally, those for which the com-
pany still has to effect payment (syndicate account) shall be
entered separately in the balance sheet, according to the kind
of security and the amount.
b. Costs
c. Special regula-
tions

– 80 –
Art. 207
By virtue of the law, the annual balance sheet as well as sup-
porting documentation, the profit and loss account and the busi-
ness report shall, with notification to the members pursuant to the
articles, be available for the said members to inspect at least ten
days before the meeting of the supreme body which shall decide
concerning the approval of the balance sheet and before the pass-
ing of a resolution by circular letter and, in addition, during the
three months following the meeting.
By virtue of the law, each member of the company providing
proof of participation may demand a copy of the annual balance
sheet but not of the supporting documentation and the profit and
loss account.
By way of Executive Order the Government may put legal
entities with capital reserves divided into bearer shares which,
together with the unsecured borrowed moneys, amount to one
million Swiss francs as well as those legal entities which have is-
sued bearer bonds without particular cover under obligation to
publish in the journals intended for official notices the annual
balance sheet together with supporting documentation in addition
to the profit and loss account, possibly on the basis of official
forms, six months after the balance sheet date at the latest.
The foregoing paragraph shall not be applicable in the case of
legal entities which simply have their domicile in the Principality
of Liechtenstein and administer their assets or whose sole purpose
or object is the undertaking’s activity abroad (domiciliary compa-
nies) and in the case of companies whose shares or participations
are purely in the hands of relatives (family concerns).
Art. 208
Where in the case of a company with legal personality or of a
legal entity of equal rank to the said company with legal per-
sonality, an annual balance shows that the capital resources, but
not the own assets in the case of partnership companies and es-
tablishments and in the case of other legal entities which, in the
same way as partnership companies, may assess their assets and
calculate their profit and loss, have decreased by half and should
3. Publication
of the annual
balance sheet
4. Duty to
disclose
a. In the case of
loss of ca
pital

– 81 –
the winding-up balance, which shall thereupon be prepared, show
the same result, the administration must convene a meeting of the
supreme body without delay and inform it of the facts of the
situation.
In the event that the capital decreases by two-thirds, the legal
entity shall be liquidated if the said legal entity does not sup-
plement the no longer available capital or reduce it to the actual
amount.
In all cases the Registrar shall be informed of the resolutions
passed; publication, however, shall only take place in the event of
a previously published provision being amended.
Art. 209
As soon as the claims of the creditors of a legal entity are no
longer covered by the assets, but are covered by the inclusion of
possibly adequate liabilities to make further contributions, the
administration and, if necessary, each member of the said ad-
ministration shall have the right and the duty to inform the court
for the purpose of opening bankruptcy proceedings. If, however,
the notification is not received from all members of the admini-
stration, the others shall be consulted.
The court may, in extrajudicial proceedings, upon petition of
the administration, the audit authority, one or several creditors or
one of the representatives or trustees appointed to safeguard the
common interests of certain classes of creditors, postpone the
opening of bankruptcy proceedings and in the meantime give
orders which serve to preserve the assets relating, for example, to
stock taking, the prohibition of payments, respite, having an in-
terrupting effect on statutory limitation and forfeiture up to the
time these measures are cancelled, the collection of additional
contributions, the restriction of the authority to represent or the
appointment of a creditor’s representative as supervisory body.
In the case of all legal entities with members’ liability or liabil-
ity to make further contributions, the petition to open bank-
ruptcy proceedings shall be dropped with the judge’s approval in
extrajudicial proceedings if the supreme body passes a resolution
immediately to wind up and assert the liability to make further
b. In the case of
overindebted-
ness

– 82 –
contributions as well as the obligation of liability in place of the
creditors or the trusteeship in bankruptcy and if the creditors
have been satisfied within nine months from the time of over-
indebtedness.
In times of economic crisis, the Government may, by Execu-
tive Order, amend the provisions of the first paragraph so that a
duty to notify shall exist under more limited preconditions.
Art. 210
Where a petition to appoint a specialist auditor is refused by a
resolution of the competent body of any legal entity or where the
petition, submitted in good time, is not put to the vote, the Court
of Justice may, by virtue of the law, within two months following
the refusal or the meeting, upon petition of members who repre-
sent at least one-tenth of the capital resources or the legal entity’s
own assets or the votes, appoint one or several auditors in extra-
judicial proceedings if, at the same time, the members can sub-
stantiate by prima facie evidence that dishonesty or gross in-
fringements of the law or the articles have taken place.
Before appointing the auditors, the court shall hear the ad-
ministration and the audit authority. The court may demand secu-
rity from the petitioners, which shall be determined at the court’s
absolute discretion pursuant to the provisions of the Code of
Civil Procedure concerning the lodgment of security for costs of
action and, depending upon the circumstances, appoint one or
several auditors.
The members concerned may, in the event of their petition
being otherwise invalid and with liability for costs and losses for
the duration of the audit, transfer their membership only with the
assent of the legal entity and/or, if securities such as shares have
been issued, they shall deposit these with the court or at a place
determined by the said court.
Where a legal entity effects banking, insurance, savings bank
or actual trust transactions and if domiciliary companies are not
involved, the Government may, of its own accord, decide to or-
der, through administrative channels, that an official audit be
III. Official audit
1. Precondition
and appoint-
ment

– 83 –
undertaken, at the expense of the legal entity, without being liable
to render compensation as a result of this.
Art. 211
Before commencing their duties, the auditors shall affirm to
the judge that they shall faithfully fulfil the duties incumbent
upon them and in particular shall observe silence towards all per-
sons concerning business and operational circumstances which
may come to their notice while carrying out the audit and they
shall be responsible in the same manner as the members of an
audit authority.
The auditors shall have the right to examine the books, vouch-
ers and inventories for the purpose of determining the accuracy of
the last annual balance sheet, to demand information and expla-
nations from the members of the administration and the audit
authority and each employee of the legal entity entrusted with the
accounting and to investigate the cash in hand as well as the posi-
tion regarding other existing assets.
The persons called upon to do so must, without delay, provide
the required clarifications and information, accurately and truth-
fully, or otherwise be responsible for all losses.
The members of a possible audit authority shall be involved in
the audit. Furthermore, the court may, at its discretion, permit the
participation of one or several of the petitioners.
The auditors’ remuneration shall be determined by the court
in extrajudicial proceedings. Otherwise, they may not draw any
other emolument.
Art. 212
The written report concerning the result of the audit, which
shall state whether all the auditors’ wishes relating to the under-
taking of the audit were fulfilled and whether the last annual bal-
ance sheet provided a truthful and correct picture of the financial
situation of the legal entity, shall be communicated to the admini-
stration and the audit authority without delay.
The petitioners have the right to examine the auditors’ report
on the business premises and, in the absence of such, at another
place to be determine by the judge in extrajudicial proceedings.
2. Position of the
auditors
3. Treatment of
the auditors’
re
port

– 84 –
The administration and the audit authority are required, for
the purpose of passing a resolution, to announce the auditors’
report when the next meeting of the supreme body is convened,
to cause the said report to be read in its entirety at the meeting
and to provide an explanation concerning the result of the audit
and concerning the steps taken to remedy the illegalities or griev-
ances which may have been discovered.
It shall be incumbent upon the audit authority to report to the
meeting concerning the claims for compensation to which the
legal entity is entitled.
Should the auditors’ report reveal that a gross infraction of the
law or the articles has taken place, a meeting of the supreme body
must be convened immediately.
Art. 213
In the absence of an agreement, the court, in extrajudicial pro-
ceedings with analogous application of the provisions concerning
the costs of the action, shall decide, depending on the result of the
audit and with due appraisal of all the circumstances, whether the
costs of the audit shall be borne completely or partly by the legal
entity.
Should, according to the result of the audit, the petition for an
audit prove to be unjustified, the petitioners shall be liable to the
legal entity jointly and severally for the damages without res-
triction arising from the petition, together with possible satis-
faction, insofar as the blame for evil intent or gross negligence
rests with the petitioners.
Art. 214
Legal entities with members’ rights to shares may provide in
the articles for the issuance of working shares to employees and
workers, for which the provisions applicable to working shares
shall be applied analogously.
Inalienable working shares issued pursuant to the articles to a
named person as property of the individual or a co-operative
society on the basis of work performance may also be provided in
such a manner that a share of the capital resources or the legal
4. Costs and
compensation
for loss
G. Sociopolitical
rights to shares
and profit
I. Workin
g shares

– 85 –
entity’s own assets does not exist but, however, a claim to the
personal rights arising from the membership, to profit, sub-
scription rights and a share upon withdrawal from the terms of
employment or to the liquidation surplus, with or without prefe-
rential right, or the other capital or asset shares shall exist.
Art. 215
The articles of a legal entity may provide for funds for the for-
mation and support of welfare institutions for members, workers
and employees or similar purposes.
Such funds as welfare institutions for members, workers and
employees have, without further formality, the character of foun-
dations and their assets are set aside from the assets of the legal
entity and are no longer liable for the legal entity’s debts.
Insofar as an actual transfer of the assets of the foundation has
not taken place, the foundation shall have a preference in bank-
ruptcy proceedings equivalent to the wage.
Resolutions concerning contributions from net profit towards
the formation and support of welfare institutions for members,
employees and workers or for other welfare purposes may be
passed by the supreme body even if such provision is not made in
the articles.
The special provisions concerning trusts and autonomous de-
partments are reserved.
Art. 216
These foundations are not subordinated to the supervisory
authority but remain, however, where the articles do not deter-
mine to the contrary, under the administration of the legal entity
and their balance sheet may not be taken into that of the legal
entity.
In the absence of other provisions in the articles, the fund shall
revert to the legal entity in the event that the purpose of such a
foundation is cancelled.
Further provisions concerning the foundation may be drawn
up in the articles.
II. Welfare funds
1. Preconditions
2. Structure and
dissolution

– 86 –
Art. 217
The articles of a legal entity may, moreover, provide that its
employees and workers participate in the net profit, which parti-
cipation shall be paid to them in cash or in another way.
By resolution of the supreme body of a legal entity, the em-
ployees and workers of the said legal entity may be awarded vol-
untary benefits in cash or in a different manner even though this
may not be provided for in the articles.
Art. 218
The bodies of a company with legal personality and the legal
entities on the same footing are liable to the legal entity for the
damage they cause if the said damage is caused intentionally or by
neglect.
They shall be liable to the members for the intent and the neg-
ligence only insofar as the legal entity is not entitled to a claim for
compensation.
Where, however, the legal entity has such a claim, the mem-
bers shall have an independent claim only in the case of damage
inflicted with intent.
Third persons who have cooperated in the issuance of shares,
share certificates or bonds shall be liable to all parties only in the
case of intentional damage.
Art. 219
Whosoever is active in the formation of a company with legal
personality or a legal entity on the same footing is liable for com-
pensation for damage:
1. If he makes or circulates untrue statements in prospectuses or
circulars,
2. if with his cooperation a deposit or the takeover of parts of
assets or a beneficial interest of individual members or other
persons are stated incorrectly or incompletely or are withheld
or concealed in the articles or a founder’s report or if he has
contravened the law by approving of such an action in another
way,
III. Other profit partici pation
H. Responsibility
I. In the case of
companies with
legal pers. and
legal entities on
the same foot-
ing
1. Kind of liabilit
y
2. Cases of
liability
a. In
general

– 87 –
3. if he had knowledge of the subscribers’ inability to pay or
otherwise to perform in respect of the capital resources or the
legal entity’s own assets.
4. if the company’s entry in the Public Register was effected on
the basis of a certification or document which actually con-
tained untruthful statements to which he contributed.
This provision shall be applicable analogously where after the
formation the same acts or omissions have led to damage.
Where such a company with legal personality or legal entity
has issued shares, share certificates or bonds, either itself or
through a third party, each person who was active in this matter
shall be liable for the damage caused or circulated by the person
concerned by way of untruthful statements in prospectuses or
circulars.
Whosoever contrary to the provisions of the law has received
payments such as profits or interest on building finance from the
legal entity shall be required to return the said payments insofar
as the recipient was demonstrably in bad faith at the time of
receiving the said payments.
Where, on the other hand, contrary to the provisions of the
law, a share of the liquidation assets has been obtained by the
members or, insofar as transactions without value are involved, by
third parties, they shall be liable to the extent of their enrichment,
even though they are in good faith.
Art. 220
The persons entrusted with the administration and the audit-
ing of a company shall be responsible for the damage caused by
the non-fulfilment of the duties incumbent upon them.
Where the neglect of duty is committed as the result of the
passing or the omission of a resolution by a body comprised of a
number of members, organised on a collegiate basis, all members
of the said body who were bound to take part in the resolution
concerned shall be responsible.
The members who voted against the resolution which estab-
lished the responsibility or, where the omission of a resolution
establishing the neglect of duty is involved, the members who
b. Management
and audit
authorit
y

– 88 –
voted for the resolution which was rejected by the majority shall
be free from the liability.
Members of a collegiate body who have also taken part in the
said collegiate body’s deliberations shall be liable if the assertion
of their votes, for whose lack of assertion they were to blame,
could have prevented the neglect of duty on the part of the said
collegiate body or if in demonstrable agreement with them other
members brought about a liability establishing a neglect of duty
on the part of the collegiate body.
Where the omission of a resolution in breach of duty is in-
volved, without the collegiate body having deliberated concerning
this, each member shall be liable from the time he became aware
of the matter and did not take steps within his authority to bring
about the deliberation of the said matter by the collegiate bodies.
Where the administration or one of its members receives an in-
struction from an overriding body, such as the supreme body or
the audit authority, whose execution would violate the duties
incumbent upon the said administration or member pursuant to
paragraph 1, execution may be refused without the legal entity
being able to assert a responsibility as a consequence thereof.
The provisions concerning the responsibility of the liquidators
are reserved.
Art. 221
Where in the case of banking establishments or trust compa-
nies, a large shareholder, who although not a member of the ad-
ministration induces, indirectly or directly, the members of the
administration of such an undertaking in the course of their man-
agement to violate the due diligence of a prudent businessman,
the said shareholder shall be liable jointly and severally with such
members of the administration for the damage thereby caused to
the legal entity, under reservation of the right of recourse to the
large shareholder of the members made responsible by the legal
entity.
A large shareholder within the intendment of this law is a
shareholder who, on the basis of his own shareholding or on the
basis of another title, has at his disposal the right to vote for at
c. Liability of
large share-
holders

– 89 –
least a tenth part or certainly for a part of the capital resources or
of the legal entity’s own assets which is so large that the votes to
which he is entitled count decisively at the meetings of the su-
preme body of the company concerned, having regard to the
amount of capital resources or own assets normally represented at
such meetings.
Those shares which are transferred to another person for the
purpose of circumventing this provision shall be ascribed to the
shareholding of the large shareholder. An intention to circumvent
the law shall be presumed where the transfer ensues to the spouse
or to a relative as far as the second degree of relationship.
Where for important reasons the circumstances justify this, the
Government may, by way of ordinance, expand this liability obli-
gation to undertakings other than those mentioned in the first
paragraph.
Art. 222
Primarily, the company that has suffered damage and, in the
event of bankruptcy, the said company’s liquidation assets, shall
be entitled to claim compensation for damage.
Where the company does not have a claim, as well as in the
case of malicious injury, each individual member may demand
that he be compensated directly for the damage inflicted upon
him.
Insofar as the company renounces the lodgment of a claim or
fails to assert the said claim within three months after a member’s
request to do so, each individual member may institute an action
in favour of the company for compensation for the damage inten-
tionally inflicted upon the company, subject to a binding resolu-
tion of release.
Where the company does not assert its claim each individual
member has the right of action on grounds of intentional damage
only if the member is able to prove that he did not take part in the
resolution or voted against the said resolution or did not become
a member until after the resolution had been passed and had no
knowledge of it.
In the event that a member initiates such an action, further ac-
tions concerning this matter may be introduced within the period
3. Liability claim
a. Claim of the
company and
of the indivi-
dual members

– 90 –
of time allowed only insofar as in the first action the damage was
not asserted to the full extent. The other members who suffered
damage, however, shall be entitled to join the first action as inter-
vening parties.
This claim of the individual member shall become statute-
barred upon the expiration of six months after the said individual
member became aware of the resolution.
Art. 223
Where the company’s creditors suffer damage they may de-
mand, if the company does not have a claim, that they be com-
pensated directly for the damage inflicted upon them.
In the case of intentional damage to the company the individ-
ual creditors may demand compensation in favour of the com-
pany for the damages inflicted upon the said company if bank-
ruptcy proceedings concerning the latter have been opened and
the bankrupt’s estate waives the assertion of the claim or, in spite
of being requested to do so, does not bring the said claim within a
term of one month.
The creditors shall be entitled to claim for damages resulting
from default, in addition to the provisions drawn up to protect
the creditors.
Art. 224
Insofar as malicious damage does not exist, the supreme body
may release the persons liable to pay damages by waiving the
claim, concluding a settlement with the persons responsible or in
any other manner, as long as the company has not become bank-
rupt. The rescission of the resolution to release , however, is re-
served.
A resolution of the company to release may, in the case of in-
jury being caused to the company, be set up as a bar under all
circumstances to the member or creditor entitled to claim insofar
as the injured party fails to prove thereby that no liability whatso-
ever was imposed upon the released persons to effect compensa-
tion or, pursuant to their fault and their ability to pay, an ap-
parantly inadequate liability to effect compensation was imposed,
or that malicious injury exists.
b. Creditors’
claims
c. Release
aa. Relationship to
ri
ght of action

– 91 –
Where the resolution to release is agreed by at least three-
quarters of all the countable votes, the claim may be brought only
provided inadequate compensation and also malevolence can be
proven.
The foregoing restrictions concerning release shall not be ap-
plicable to settlement proceedings for the warding off or termina-
tion of the bankruptcy of the person responsible
The release conferred by the competent body of the admini-
stration on the basis of an audit authority report shall embrace
only those transactions of which the audit authority has know-
ledge.
Art. 225
Where the management and the representation and/or the
audit are conducted pursuant to the law and the articles and other
admissible instructions, the members of the administration and/or
the audit authority shall have a claim to release against the com-
pany through the competent body and with effect against the
company, its members and creditors.
The release may be pronounced in judicial judgment.
Art. 226
The liability of the persons responsible pursuant to the fore-
going provisions is subject to the provisions concerning liability
as determined by contract and becomes statute-barred in ten years
and where knowingly false statements or intentional infliction of
injury are not involved, in two years, calculated from the time
when the transaction to which the injury is attributed took place.
Where several persons are responsible for the injury inflicted,
they shall be jointly and severally liable for the compensation.
Liability arising from the illegal receipt of payments of the le-
gal entity becomes statute-barred for the recipient in bad faith in
ten years where the liquidation share is involved and in five years
in the other cases and for the recipient of a liquidation share in
good faith, in two years, calculated from the day of receipt.
bb. Claim to
release
4. Nature of
liabilit
y

– 92 –
Art. 227
In the event of the litigation and liability for all the injury
sustained by the company or the members of company bodies
being otherwise invalid, the plaintiff members shall not surrender
their membership rights and the plaintiff creditors may not sur-
render the demands which establish the characteristics of a credi-
tor for the duration of the litigation.
In the case of action to rescind against resolutions of the su-
preme body, relevant provisions shall be analogously applicable
to the lodging of security on grounds of damage accruing to the
company or the other defendants, to the combination of several
actions and to the liability for damage.
Art. 228
Insofar as companies with legal personality or legal entities on
the same footing are not under consideration, the principles of
liability corresponding to the underlying contractual relationship
between the bodies and the legal entity shall be applicable with
respect to the responsibility and the liability of the bodies; in
cases of doubt those regulations concerning the mandate relation-
ship shall be applicable.
The foregoing provisions are analogously applicable with re-
spect to the claim of the legal entity and the individual members,
the release and the kind of liability.
Art. 229
In its articles, a legal entity may concede a special legal posi-
tion to the community on the basis of a special agreement with
the said community; this may be with or without its inclusion in
the membership and may relate to the liability to contribute, the
right to vote, participation in the administration and the audit
authority or in their appointment, liability to the creditors, the
termination of the relationship and participation in the liquidation
result.
5. Proceedin gs
II. In the case
of other legal
entities
J. Participation of
legal entities
under public
law
I. In
general

– 93 –
Art. 230
In the case of such legal entities and also mixed economic un-
dertakings in which a legal entity under public law participates as
a member, the liability of the members, the administration and the
audit authority shall be:
1. Towards the legal entity, the members and the creditors where
in the individual case the Government does not determine
otherwise pursuant to the provisions as applicable to the
members elected by the supreme body,
2. towards the legal entity under public law pursuant to the con-
tractual relationship existing between the said legal entity un-
der public law and the member, such as a services contract, a
commission mandate and the like.
The legal entity under public law may, however, according to
regulations, assume the liability for its representatives in the bod-
ies of the legal entity performing their functions with care, with
reservation of recourse to the persons at fault.
The representatives of the legal entity under public law shall
under all circumstances remain liable for intentional violation or
neglect of the said public entity’s duties.
Otherwise, the special provisions concerning the undertakings
serving the public economic interest are reserved.
Art. 231
Where the articles lack a statement as required by law con-
cerning the form of the notification to members of the legal entity
or third parties, notification, in case of doubt, shall ensue through
the administration and in the journals provided for official an-
nouncements. In the case of societies, small cooperative societies
and small insurance associations, however, whose activity is lim-
ited to a local sphere, notification shall ensue in the manner cus-
tomary in the locality.
In the case of legal entities which simply have their domicile in
the Principality of Liechtenstein (domiciliary companies), noti-
fication displayed on the court notice board in extrajudicial pro-
ceedings shall be sufficient where doubt exists.
II. Res ponsibilit y
K. Notification

– 94 –
In the case of a lapse in a form of notification provided in the
law or the articles, the Registrar, upon the demand of the admini-
stration, shall determine a means of notification for as long as the
law or the articles fail to do so.
Public notification in journals, proclamation in the church
square, and the like shall, except in the case of domiciliary com-
panies or unless the Registrar allows an exception, ensue in the
language of the Country.
Art. 232
1)
Depending on whether a legal entity is organised according to
foreign or Liechtenstein law, i.e., its Articles declare foreign or
Liechtenstein law as applicable or it complies with foreign or
domestic filing or registration provision or, if such provisions do
not exist, has been organised according to foreign or Liechten-
stein law, it is to be regarded as a foreign or domestic law shall be
applied. It shall also have its domicile there in regard to the inter-
national relationship.
If a legal entity does not meet these conditions, it shall be
subject to the law of the state in which it has the centre of ist ad-
ministrative activity.
The provisions concerning diplomatic protection and the legal
protection of personality are reserved.
Art. 233
2)
A foreign legal entity, with the permission of the Court of
Justice and through an entry in the Public Register and the ap-
pointment of a legal representative should such be necessary, may
subordinate itself to domestic law and thus transfer its domicile to
the Principality of Liechtenstein without dissolution abroad and
re-formation in the Principality or without the transfer of its
business activities or administration.

1) Para 1 and 2 in the version of the law dated 30. October 1996, LGBl. 1997,
No. 19.
2) Art. 233 in the version of the law dated 30. October 1996, LGBl. 1997, No. 19.
I. International
law
1. Foreign or
domestic legal
entities and
a
pplicable law
II. Transfer of a
legal entity
1. Transfer of the
legal entity
from abroad to
Liechtenstein

– 95 –
This permission may only be granted when the legal entity
shows that it has complied with domestic law and that the foreign
law permits a transfer of the legal entity.
A legal entity must show before the entry in the Public Regis-
ter is executed that the registered capital declared as fully paid up
in the Articles is covered at the time of the transfer of the legal
entity.
A legal entity which by domestic law is not subject to regis-
tration becomes subject to domestic law as soon as its intention to
become subordinate to domestic law is clearly evident, has an
adequate relationship with the Principality and compliance with
domestic law has taken place.
Art. 234
The subordination of a domestic legal entity to foreign law
and thus the transfer abroad of its domicile without dissolution is
admissible only with the permission of a public office designated
by the Government by ordinance.
By way of ordinance, the Government shall specify the proce-
dures and conditions for the granting of permission for the transfer
of domicile, especially in regard to the protection of creditors.
1)
The transfer abroad of a domestic legal entity without disso-
lution is admissible only with the approval of a government office
which has been designated by the Government in an Executive
Order and provisions relevant to this in the articles shall be inva-
lid as long as the administration’s activity is centred in the Princi-
pality of Liechtenstein.
2
The Government may by way of ordinance draw up other or
further provisions concerning the transfer of domicile or forbid
this completely or partly.

1) Para 1 and 2 in the version of the law dated 30. October 1996, LGBl. 1997, No. 19.2) Para 3 in the version of the law dated 16. December 1994, LGBl. 1995, No. 25.
2. Transfer of the
legal entity
from Liechten-
stein to another
State

– 96 –
Art. 235
1
The legal capacity and the capacity to act, including the capac-
ity for tortious liability, shall be determined according to the law
applicable to the legal entity (Art. 232).
In particular, this law shall decide on the formation, amend-
ment and dissolution of a legal entity, on the organisation, rights
and obligations of the individual bodies, the legal position of a
member, the acquisition and loss of membership.
Within the Principality of Liechtenstein, however, it may not
acquire rights and assert a claim to the protection of the law to a
broader extent than is possible for domestic legal entities and a
foreign legal entity shall have at least the same capacity for tor-
tious liability as such domestic legal entities.
Legal entities may not assert in the Principality of Liechten-
stein prerogatives (privileges) acquired abroad.
When pursuant to the law applicable to the legal entity the as-
sets of a legal entity shall pass to a community, the assets located
in the Principality shall not pass to the foreign community, but
shall be treated in accordance with domestic law.
Where a foreign legal entity does not have legal capacity or the
capacity to act or the capacity for tortious liability pursuant to
this applicable law, but such does indeed apply according to do-
mestic law, the latter shall be applicable for ist activities within the
Principality.
Art. 236
1)
Liechtenstein law shall be applicable for the formation,
amendment and dissolution of a branch establishment of a foreign
legal entity in Liechtenstein.
The relationship of the branch establishment to the principal
establishment shall be determined, however, by the law in force at
the principal domicile.
A branch establishment’s authority to represent shall be de-
termined by Liechtenstein law. At least one person with repre-

1) Art. 235 and 236 in the version of the law dated 30. October 1996, LGBl. 1997,
No. 19.
III. Legal capacity
and the
capacity to act
1. General
2. Branch estab-
lishment

– 97 –
sentative authority must have his or her domicile in the Principal-
ity and be entered in the Public Register.
Where a branch establishment of a foreign legal entity is en-
tered in the domestic Public Register, the foreign legal entity shall
be considered to have legal capacity and capacity to act respecting
the obligations entered into or to be fulfilled in the Principality of
Liechtenstein even though pursuant to the law in force at the
principal domicile it does not possess such capacities.
Foreign legal entities which do not conform with Liechten-
stein law may also form branch establishments in the Principality.
Where a foreign legal entity is dissolved by a step taken in the
country of principal domicile which contravenes public order and
morality, the effects of the dissolution shall not be recognised in the
Principality of Liechtenstein. If, however, a branch establishment
exists in Liechtenstein, this shall be formed, if dissolution is not
ordered, into an independent legal entity within a period of time to
be determined by the Registrar or otherwise be officially liquidated.
Art. 237
1)
A foreign legal entity may only claim legal protection of per-
sonality in Liechtenstein pursuant to the law applicable to it, but
not exceeding the scope of Liechtenstein law.
Liechtenstein law shall be applicable to the domestic branch
establishment of a foreign legal entity with respect to legal pro-
tection of personality.
Art. 237a
1)
Should the name or style of a legal entity entered in the do-
mestic Public Register be violated, the protection of the same
shall be determined by domestic law.
If a legal entity is not registered in the domestic Public Regis-
ter, the protection of its name or style shall be determined by the
law applicable to unfair competition or to the violation of per-
sonal rights.

1) Art. 237, a, b, c and d in the version of the law dated 30. October 1996, LGBl.
1997, No. 19.
3. Protection of personalit y
4. Protection of
name and st yle

– 98 –
Art. 237b
1)
A legal entity may not refer to the restriction of the authority
to represent of a body or representative which is unknown to the
law of the state of normal domicile or to the branch establishment
of the other party unless the other party knew of this restriction
or should have known of it. This provision shall not apply to legal
business disposing of landed estate situated in another state or to a
right equated with such.
Art. 237c
1)
Should the impression be given by a legal entity which has
been formed in accordance with foreign law that it is subject to
domestic law and its business is conducted within the Principality
or from the Principality, the liability of the persons acting for it
for such business shall be subject to domestic law.
Art. 237d
1)
Claims from the public issue of equities and bonds on the basis
of brochures, circulars and similar notices may be lodged pursu-
ant to the law applicable to the legal entity or in accordance with
the law of the state in which the issue took place.
Art. 238
The acquisition within Liechtenstein by one of the legal enti-
ties regulated under this Heading of donations without valuable
consideration, such as gifts, legacies and the like in excess of five
thousand Swiss francs as well as the acquisition in Liechtenstein
of real estate, if the total ownership exceeds the size admissible for
the erection of a homestead, shall require the permission of the
Government in order to be valid.

1) Art. 237, a, b, c and d in the version of the law dated 30. October 1996, LGBl.
1997, No. 19.
5. Restriction of
the authority to
re
present
6. Liability for
foreign legal
entities
7. Claims from
the public issue
of equities and
bonds
8. Restriction of
mortmain

– 99 –
This provision shall also be applied to foreign legal entities
under public law.
In the case of family foundations and establishments or insofar
as the law or the Government order exceptions otherwise, the
provisions concerning donations without valuable consideration
shall not be applicable where real estate is not involved.
1)
Art. 239
2)
Domestic legal entities and the branch establishments of for-
eign legal entities whose managing or representing bodies, such as
the board of directors or the administration, are comprised in the
main of foreigners or foreign firms, shall appoint in Liechtenstein
a Liechtenstein citizen who is permanently resident here, either to
represent the legal entity towards the authorities as a legal repre-
sentative or, empowered as an authorised signatory (procurist), to
exercise the representation, without the co-operation of others.
Instead of this, the Landesbank or a firm may also be desig-
nated as a legal representative that shall appoint a Liechtenstein
citizen who is permanently resident in Liechtenstein as a legal
representative or at least equip the said Liechtenstein citizen with
the power of agency of a legal representative.
Notwithstanding the provision concerning the appointment of
a legal advisor, the observance of the provisions of this article may
be supervised by the Government in administrative proceedings.
The obligation to appoint may be dropped with the agreement
of the Government where important reasons exist as, for example,
where a legal entity or its branch establishment brings into the
Country work and earnings or significant public proceeds or
similar and, otherwise, in the event that the legal entity’s remain-
ing representation provides adequate warranty as a substitute for
the legal representative.

1) Art. 238 last para (= para 3) inserted by the law dated 10 April, 1928, concerning
trust enterprises, LGBl. 1928, No. 6.
2) Para. 3 of Art. 239 deleted by the law dated 21. March 1996, LGBl. 1996, No. 68.
IV. Legal repre-
sentative
1. Obligation to
a
ppoint

– 100 –
Art. 240
1)
In the event that the legal entity is not entered in the domestic
Public Register, the bodies of the legal entity entitled to represent
shall notify the legal representatives to the Public Register, en-
closing an excerpt from the registers kept abroad, or, possibly,
otherwise credible proof of identity. The following information
shall be furnished:
1. The name of the firm or the name of the legal entity,
2. the name, domicile and nationality of the legal representative.
If the legal representative does not notify the signature or sig-
nature rights in notarized form, the said legal entity shall record
these in the presence of the Registrar.
In the case of foreign insurance undertakings, the legal repre-
sentative’s entry shall be published. In the case of other under-
takings, the publication may be omitted.
Art. 241
2)
By virtue of the law, the legal representative is empowered in
respect of all court and administrative authorities, in all matters,
notwithstanding a possible obligation to compensate the legal
entity, to receive declarations and communications of all kinds
including service and the like, also to keep files in safe custody
and to keep books of account, where and insofar as the domestic
operation requires this.
Apart from representation towards authorities, the legal rep-
resentative may put a legal entity under obligation only insofar as
he has been empowered to do so by the said legal entity.
Where doubt exists, several legal representatives appointed by
one legal entity shall have joint power of agency.
Legal representatives shall sign on behalf of the legal entity by
signing their name by their own hand to the written, etc., wording
or company name or name, with a subscript which alludes to the
legal representative.

1) Para. 2 and 4 of Art. 240 deleted by the law dated 21. March 1996, LGBl. 1996,
No. 68.
2) Para. 3 of Art. 241 deleted by the law dated 21 March 1996, LGBl. 1996, No. 68.
2. Registration
in the Public
Re
gister
3. Legal power of
a
genc y

– 101 –
Otherwise, the provisions concerning signature rights in the
case of legal entities shall apply analogously to the signing ef-
fected by the legal representative.
Art. 242
The legal representative shall be liable to the legal entity for
all damage caused as a result of the said legal representative’s ac-
tivities, in the same manner as a mandatary.
Several legal representatives shall be liable jointly and severally
for all the damage caused by them as a result of their activities.
Art. 243
1)
Art. 244
Public law remains reserved for legal entities under public law,
ecclesiastical legal entities and the legal entities regulated under
this law.
The provisions under this Heading, with the exception of the
provision concerning capacity to act and capacity for tortious
liability, shall not be applicable to corporate bodies or establish-
ments (banks, associations of insurers, etc.) which are formed
under special laws and administered with the participation of
public authorities, insofar as the state accepts the subsidiary li-
ability for their obligations, even where the necessary capital is
completely or partly divided into shares or other participations
and subscribed by the participation of private persons, unless the
law were to order otherwise.
Legal entities under public law and ecclesiastical legal entities,
however, shall be deemed to have legal capacity and capacity to
act as soon as the provisions of this law have bestowed the said
capacities, insofar as the public and/or ecclesiastical law, with
reservation of ecclesiastical foundations, does not determine
otherwise.

1) Art. 243 deleted by the law dated 21. March 1996, LGBl. 1996, No. 68.
4. Res ponsibilit y
M. Reservation
and scope of
application
I. Reservation

– 102 –
The provisions concerning the capacity for the tortious liabil-
ity of the legal entities shall also be valid, however, for legal enti-
ties under public law and ecclesiastical legal entities in the sphere
of their private-law activity where the administration or a mem-
ber thereof or another representative appointed on the basis of the
legal provisions commits a tortious act or an omission within the
frame of his powers.
The special provisions concerning the liability of such legal
entities for compensation under public law on grounds of
wrongful or lawful exercise of the public authority entrusted to
their bodies, officials and employees, are reserved.
Art. 245
Furthermore, all the corporate bodies and establishments in-
cluding foundations regulated under the following Headings shall
be subject to the general provisions under this Heading, insofar as
the special provisions drawn up for them or the individual provi-
sions under this Heading do not determine a deviation.
Legal entities under private law other than those determined
under this law cannot exist.
II. Scope of
validit y

– 103 –
Fourth Title
Second Section
The Company Limited By Shares
Art. 261
The limited company is a company having its own name
(firm), whose capital, determined in advance (nominal capital,
capital invested), is divided into smaller amounts (shares). Only
the company’s assets are liable for the company’s debts.
The shareholders are only liable as far as the performances as
laid down in regulations are concerned and are not liable person-
ally for the company’s liabilities.
The deviating regulations concerning the special legal entities
pursuant to foreign law, concerning variable nominal capital,
additional benefit shares and similar are reserved.
Art. 262
Instead of being divided into certain amounts the nominal
capital, determined in advance, of a limited company may be di-
vided into portions (quotas), which may be equal or dissimilar
(shares without par value).
The non par value share is issued for a portion of the nominal
capital, without having to have a specific value.
Fixed and non par value shares may also be combined and the
regulations relating to fixed shares are also applicable to non par
value shares unless pursuant to the relevant provisions they are
inapplicable.
In addition to the quota in words, the securities issued as non
par value shares must also state the amount of nominal capital and
the reserves, if any.
Art. 263
The shares are issued to a named person or to the bearer and
may also be comprised simultaneously of both types in the pro-
portion provided for in the articles.
A. General provi-
sions
I. Definition
1. In the case of
fixed shares
2. In the case of
non par value
shares
II. Share
1. Type of
shares

– 104 –
The articles may determine that the shares issued to a named
person, i.e. the registered shares, shall or may be converted to
bearer shares, or bearer shares shall or may be converted to regis-
tered shares.
The provisions relating to special types of shares such as ordi-
nary or preference shares are reserved.
Art. 264
With reservation of the subparticipations between a share-
holder and a third party and the trust certificate, a division or
consolidation of shares or share units by a shareholder is inad-
missible.
On the other hand, by means of an amendment of the articles,
the general meeting is empowered, with the subscribed capital
remaining unchanged, to divide the shares into other shares of a
lower par value, to divide them into units of shares or, with the
assent of the shareholders, to reduce the number of shares so that
they have a higher par value.
Art. 265
It is permissible to reduce the par value of individual shares,
provided that the existing amount of nominal capital is main-
tained unchanged, by simultaneously issuing new shares equal to
the amount or the quota of the effected reduction of the share
value hitherto.
On the other hand, a reduction of the par value of individual
shares without a simultaneous issue of new shares is only permis-
sible when the regulations are observed which relate to the re-
payment and reduction of the nominal capital and its distribution
in the case of the dissolution of the company.
A reduction of the quota is subject to the regulation of the
foregoing Article.
Art. 266
An issue for an amount which is less than the nominal
amount is only permissible in the case of registered shares
which are transferable with the assent of the company and with
the approval of the Register Authority.
2. Division,
consolidation
and change of
shares or units
of shares
3. Reduction of
the nominal
value
4. The amount of
the share

– 105 –
The conversion of such registered shares into others may en-
sue by reducing the nominal capital as laid down in the articles to
the amount actually taken up or still available or if the nominal
capital as laid down in the articles is actually available through
further contributions from profits and similar.
Where shares have been issued below the par value, the par
value of all the shares which have been issued must be entered on
the liabilities side of the balance sheet.
It is admissible to issue at a higher value if such an issue is pro-
vided for in the articles or if the general meeting or a body em-
powered by the general meeting passes resolution to this effect.
The added value achieved over and above the nominal value
may not be distributed as profit, but must be used to meet ex-
pense items or for writing down or for the creation of reserves.
Art. 267
The company is obliged to issue share certificates only if the
articles do not determine otherwise.
The articles may determine in detail the form and terms of the
share certificate.
The share certificates must bear the signature of at least one
member of the board of directors or the mechanical reproduction
of a personal signature of such members.
The share document must comprise a share certificate and a
renewal coupon sheet may also be attached.
Art. 268
The share certificate records membership of a limited com-
pany, in particular, the right of participation in nominal capital,
the right to dividends and to vote.
In the case of registered shares, the share certificates must
contain the detailed regulations relating to transfer as provided in
the articles; similarly, in the case of additional benefit shares, the
details of the performance must also be included.
If in order to exercise the right to vote and similar it is neces-
sary to deposit shares, it shall be sufficient in case of doubt to
5. Share certifi-
cates
a. In
general
b. Share certificate

– 106 –
deposit the share certificate, unless the articles expressly deter-
mine otherwise, such as the presentation of the certificate with the
coupon, or permit only the bearers of the coupons relating to the
previous business year to participate in the general meeting.
Unless the articles provide otherwise, the regulations applying
to bearer or registered securities or securities that can be trans-
ferred by endorsement shall apply with regard to the declaration
of invalidation, depending on the kind of shares, and the person
who brought about the declaration of invalidation may, in the
absence of provisions to the contrary in the articles, at his own
expense, demand the issuance of a new document.
Art. 269
The talon is an authorisation to obtain new coupon sheets,
when the old coupons have been used up, lost or mislaid.
The talon may only be transferred together with the share cer-
tificate.
The procedure for the declaration of invalidation shall be in
accordance with the existing regulations for bearer papers.
As far as the company is concerned, only the bearer of shares
is entitled to obtain a talon in the absence of a special authorisa-
tion.
Art. 270
The issued coupons record the membership right to receive
dividends and, after the dividend has been determined by the
competent body, an independent right to claim which cannot be
withdrawn by the company.
As long as they remain attached to the share certificate the
coupons are part of the latter and share its legal fate; after they
have been separated or if they are issued independently, they are
nevertheless independent securities and in case of doubt are sub-
ject to the provisions concerning bearer papers, in particular with
respect to the declaration of invalidation.
With the loss of the shares as, for instance, in the case of re-
demption, collection or withdrawal or similar, the right derived
c. Talon
d. Coupon
aa. In
general

– 107 –
from the coupon is also lost, even if it is independent, if the distri-
bution of a dividend has not been decided at the time of the loss
of the share.
The coupon detached from the share with which it is associ-
ated may be declared invalid independently of the share; if it is
joined to the share, it may only be declared invalid together with
the share.
Art. 271
In respect of the right to draw dividend, the coupon of the in-
dividual share has the same status as the share itself so that the
coupon of the preference share takes precedence over the coupon
of the ordinary share and the coupon of the ordinary share takes
precedence over the dividend-right certificate or the dividend
share, if the articles do not provide otherwise.
In the absence of provisions to the contrary in the articles as,
for example, in the case of the existence of dividend-right certifi-
cates, the right to draw dividend in advance or the right to a cu-
mulative dividend and the final payment of dividend shall con-
form with the legal status of the share and, subject to other
provisions in the articles, only the shareholder has the right to
contest a resolution of the competent body relating to the decla-
ration of dividends.
In the event of the share being pledged, the coupon shall be
deemed to be pledged with the share insofar as the lien on the
coupon has been asserted in compliance with the required legal
form, unless it has been agreed otherwise.
In case of doubt, the profitability or dividend guaranteed to a
company shall be for the benefit of the bearer of the coupon.
Art. 272
Workers’ shares may be handed over to the employees and
workers of an undertaking pursuant to the detailed provisions
drawn up in the articles. Such transfer may also be effected with-
out the subscription and the taking up of at least 20% of the
capital having to be fixed at the time of issue and without entry in
the Public Register.
bb. Legal status of
the cou pon
6. Workers’
shares
a. In
general

– 108 –
Workers’ shares have the same nominal value or the same
quota as the undertaking’s other capital shares. However, they
must be entered in the balance sheet with that sum which has
been taken up.
Art. 273
Workers’ shares are issued to a named person and, as long as
the shareholder is an employee or a worker in the employ of the
company, they may not be transferred at all and later, only with
the assent of the board of directors.
This permission to transfer may not be refused if the acquirer
of the shares pays the outstanding amount at the time the share is
transferred.
Otherwise, there is an obligation to pay the call on these
shares only insofar as the owner must allow the participation in
the net profit of the undertaking and the dividend accruing to the
sum paid up on the actual shares to which the owner is entitled
pursuant to the articles to be entered to his credit until the par
value (the quota) of the workers’ share has been fully paid up.
Art. 274
As soon as 20% of the workers’ shares has been paid up, the
capital increase brought about by this payment must be entered in
the Public Register.
The shareholder’s right to vote commences from this time.
A new entry must be made in the Public Register each time a
further 20% is paid up.
After the workers’ share has been fully paid up, it is converted
to a normal capital share having the same nominal value (quota)
and the properties of the most entitled kind of share issued by the
undertaking at this time or in the future.
b. Registered
shares, transfer
and
payment
c. Registration,
voting right
and conversion

– 109 –
Art. 275
During its existence, the workers’ share shall be entitled, in
proportion to the amount paid up at the time, to the same rate of
dividend as the most entitled kind of share issued at the time by
the undertaking.
Payment of the dividend shall be by credit entry in the ac-
count of the outstanding capital payment, the outstanding
amount being that which was outstanding at the time of the last
balance sheet.
Art. 276
The articles may determine that a certain part of the annual
profit may be devoted to the creation of a fund for the purpose of
issuing shares for workers and employees who, in this case, may
form a workers’ cooperative pursuant to the regulations relating
to small cooperative societies.
In case of doubt, such cooperative society shall be the sole
owner of the shares issued.
In particular, the articles shall make provision for the repre-
sentation of the workers’ shares in the company’s governing
bodies.
Art. 277
The regulation which determines that the amount of nominal
capital of the company must be fixed in advance does not apply to
workers’ shares.
Moreover, the limited company with variable invested capital
is reserved.
Art. 278
With the assent of the workers and employees, the articles
may also settle the issuance of workers’ shares (low-priced shares)
by determining that a part of the workers’ and employees’ wages
(salaries), to be defined in detail in the articles, shall be deducted
and used to redeem each year (drawing for redemption) the other
company shares (capital shares) which shall be replaced by
workers’ shares.
d. Dividend
entitlement
e. Workers’ sha-
res in combi-
nation with a
workers’ co-
o
perative
f. Variable ca
pital
g. Creation of
workers’ shares
from wa
ges

– 110 –
Art. 279
The limited company’s articles must contain provisions relat-
ing to the following:
1. The name and domicile of the company,
2. the company’s objects,
3. the amount of nominal capital and individual shares or parts of
shares, with a statement as to whether these are registered or
bearer shares, the quantity of each type as well as the sum ac-
tually paid up,
4. the convening of the general meeting, the shareholders’ right
to vote and the passing of resolutions,
5. the governing bodies for the administration and, if necessary,
for supervision and the manner in which representation shall
be exercised,
6. the manner in which company notices to shareholders and
third parties shall ensue.
With the exception of No. 6, the provisions shall be deemed
to be essential within the intendment of the voidability pro-
ceedings.
Art. 280
Provisions which pursuant to the regulations of the law are
only valid if they are provided in the articles (by-articles) are, in
particular, the following:
1. Information concerning contributions to capital which are not
made in cash, acceptance of assets, with notification of the ac-
ceptance price, acceptance of shares or other performances in
lieu of payment , with statement of the number of shares,
stipulation of special advantages in excess of the usual bank
commission in favour of one or certain shareholders or other
persons, with the names of such persons, issuance of divi-
dend-right certificates to these as well as any other kind of
founders’ advantages whatsoever,
2. regulations relating to article amendments, business expansion,
business limitation, capital increase, capital reduction, fusion,
which deviate from the legal provisions,
III. Articles
1. Legally
required
content
2. Provisions to
be drawn up if
necessar
y

– 111 –
3. the admissibility of acquiring own shares for valuable con-
sideration for the purpose of amortisation pursuant to the
articles or repayment of the nominal capital and the conver-
sion of shares,
4. the number of shares, if any, to be deposited by members of
the board of directors,
5. building interest promise,
6. limitation of the duration of the undertaking,
7. penalties for delay in the taking up of shares,
8. release from the duty of payment on shares in excess of one-
half or a higher quota of the nominal capital,
9. the preclusion or limitation of the transfer of registered
shares,
10. issuance of founder’s share certificates, dividend-right certifi-
cates and dividend shares as well as the issuance of preference
and ordinary shares below the par value or shares with mul-
tiple voting rights, bonus shares or convertible bonds and the
taking up of convertible loans,
11. limitation of the shareholders’ right to vote and right to be
represented,
12. the matters concerning which resolutions cannot be passed by
a simple, but only by a larger majority or concerning which a
resolution can be passed when a certain number of shares are
represented or in accordance with other requirements,
13. authorisation to transfer certain powers of the administration
to individual members or third parties and the appointment of
a board of directors,
14. regulations concerning the organisation of the audit authority
and the extension of its powers and duties which go beyond
the legal provisions,
15. regulations which supplement the legal provisions concerning
the drawing up and examination of the balance sheet and the
calculation and distribution of the profit.

– 112 –
Art. 281
With reservation of simultaneous formation, the following are
required for the formation of a company limited by shares
1. The determination of the articles by the founders, who must
sign the draft of such articles,
2. the subscription to the shares forming the nominal capital,
3. the resolution of the general meeting of the subscribers ap-
proving the subscriptions and the ensuing payment for shares
and appointing the required company bodies.
Art. 282
1)
Art. 283
In order to be valid, subscriptions to shares, also subscriptions
in kind, require a written declaration referring to the draft articles
and, in the case of a public share issue, to the prospectus.
Apart from the implicit condition relating to the materiali-
sation of the limited company, they must be worded uncon-
ditionally and include the issuing price as well as the length of
time for which the subscription remains binding.
A sum amounting to at least 20% of the subscribed share capi-
tal must be paid up for each share at a paying in office mentioned
in the offer, at the time of application or, at the latest, at the con-
stitutive general meeting, such sum to be at the exclusive disposal
of the company’s future administration, unless the minimum
payment owed by the subscribers is covered by the assets in kind
to be acquired by the company.
Art. 284
After the subscription to shares has been closed, a general
meeting of the subscribers, summoned pursuant to the provisions

1) Art. 282 deleted by the law dated the 23. October, 1997, LGBl. 1997, No. 210.
B. Formation
I. Successive
formation
1. Formation
requirements in
general
Subscription
and
paying in
3. Constitutive
resolution

– 113 –
of the law and the articles, must, on the basis of the certificates to
be submitted to it, pass a resolution determining that the nominal
capital is fully subscribed and that the minimum amounts deter-
mined in the articles, but at least 20% of each share, are paid up in
cash or covered by the subscriptions in kind described in detail in
the articles.
In addition, the necessary bodies must be appointed at the
same meeting and the draft articles which provide for the sub-
scription to shares shall be considered and determined finally.
Important amendments to the draft articles may only by made
with the assent of all the subscribers represented at the general
meeting.
A vote shall be taken on the draft and a public document shall
be drawn up concerning the resolution, unless all subscribers in
favour sign the draft and the resolution.
Art. 285
Where the bringing-in of tangible articles of property or rights
is concerned, whether these are to be offset by a part of the share
capital or by cash, or where certain shareholders are to be granted
special preference rights, a promotion report must be submitted in
writing to the general meeting before a vote is passed. This report
must contain detailed information concerning the scope and con-
dition of the objects brought in and the appropriateness of the
calculated evaluation, the number of shares acquired, preference
rights which are in excess of a customary bank commission, the
issuance of dividend rights certificates and, generally, the subs-
tantiation and appropriateness of the preference rights granted to
the founders.
The original of this report or a certified duplicate must be
available for inspection by the shareholders at every subscription
receiving office, before the commencement of the subscription
period.
4. Procedure
relating to
capital invested,
aquisitions and
founders’ pref-
erence rights
a. Re
port

– 114 –
Art. 286
At the request of subscribers, who must represent at least ten
percent of the nominal capital, the passing of a resolution con-
cerning the approval of the subscriptions in kind and the found-
ers’ preference rights must be suspended until the judge, in extra-
judicial proceedings, has appointed an expert authority to report
on the valuation and condition of the subscriptions in kind and
the investments to be acquired as well as the appropriateness of
the founders’ preference rights. Such report shall be submitted at
a second general meeting. It shall also be duplicated ten days in
advance and held in readiness for the shareholders.
If the founders have given the general meeting a report of an
expert authority or if other subscribers replace those who sub-
mitted the request, the subscribers’ request pursuant to the fore-
going paragraph shall be no longer applicable and the subscribers
shall have the choice, without a new report, of participating or,
without a claim for compensation, but with restoration of any
contributions which may have been made to the nominal capital,
of withdrawing.
The provision of the first paragraph shall also be inapplicable
if the articles provide for a special category of shares for the sub-
scriptions in kind or the acquisitions in kind (non-cash shares)
which, in the case of the company being dissolved within two
years of the creation of such shares, would be satisfied from the
liquidation assets only after the shares received for cash had been
satisfied in the event of a loss occurring as the result of a proven
over-valuation at the time of contribution or acquisition.
Art. 287
The provisions in the articles concerning payments in kind,
acquisitions and founders’ preference rights require special ap-
proval from the general meeting which must be held after the
subscription to shares has been closed. The following regulations
shall apply to such approval by operation of law:
1. Only one vote shall be accorded to each person present when
the vote is taken,
b. Expert opinion
and apportio-
ned shares
c. Passing of
resolutions at
the general
meetin
g

– 115 –
2. each object shall be put to the vote separately and the share-
holder making the contribution concerned or appearing as the
transferor of a capital asset to the company or stipulating spe-
cial rights may not vote either for himself or as a proxy,
3. the approval of the contribution or the acquisition of prefer-
ential treatment must ensue with a majority of at least three
quarters of the votes present or represented,
4. a public document or a document signed by all the voters who
voted in favour shall be drawn up concerning the resolution
and shall be attached to the original report submitted by the
founder and the original report (if any) of the expert authority.
The foregoing and this article shall not be applicable where a
public share issue has not taken place.
Upon application of the subscribers, the judge in extrajudicial
proceedings may allow exceptions to the regulations contained in
the first paragraph as, for example, if all the founders’ subscrip-
tions are in kind or if the necessary majority of subscribers enti-
tled to vote and not involved in the contributions to capital, ac-
quisitions or benefits could not otherwise be achieved.
Art. 288
The formation of a limited company may ensue when all the
founders declare in a deed their intention to form a limited com-
pany. Such a deed must be signed by all the founders and the
signatures must be certified. The said founders must determine
the articles of the company, the acquisition of all the shares and
confirm in the deed, by means of substantiation from the bank or
similar, the paying in of at least 20%, also more if required, for
every share, whether in cash or by transfer of payment in kind.
Assent must also be given in the deed to any other acquisition of
assets as well as to the appointment of the company’s necessary
bodies.
The drawing up of such a deed takes the place of the con-
stitutive general meeting.
II. Simultaneous
formation
1. Formation of
the com
pany

– 116 –
Art. 289
The shares of a company formed in the manner just described
may be put up for sale after formation by their acquirers or for
the account of the same by third persons, by means of a public
share issue or by admission on the stock exchange for official
trading only if the results and balance sheets for at least the first
two business years can be submitted with the share offer.
Documents of ownership of the shares may not be issued to
the shareholders by the company during these two years, not-
withstanding membership rights and the issuance of dividend
right certificates having the character of securities.
The foregoing provisions shall not apply if the deed does not
provide either for tangible articles of property or rights to be
handed over or acquired as contributions to capital or does not
allow founders’ preference rights, furthermore, the foregoing
provisions shall not apply if the articles provide for non-cash
shares and only these are blocked.
Art. 290
Registration by the members of the board of directors entitled
to sign must be accompanied by the original or a certified copy of
the articles and the minutes of the general meeting or the deed or
a declaration containing:
1. The determination that the entire nominal capital is covered,
with signatures confirming this, with reservation of issue
below the nominal value and authorisation of the board of
directors to issue further nominal capital without a resolution
having to be passed by a general meeting,
2. the determination that at least 20%, or more if the articles
determine a higher minimum amount, has actually been paid
up for each share, or the amount is covered by payment in
kind,
3. proof that the board of directors and, if necessary, the audit
authority have been appointed, with details of the names, first
names, profession and place of residence, or the name of the
company and domicile of the members,
2. Blocking the
shares
III. Registration of
the company
1. Notification of
re
gistration

– 117 –
4. if necessary, the resolutions of the general meeting concerning
the contributions to capital, acquisitions and founders’ prefer-
ence rights as well as the related reports of the founders and
the expert authority.
Where representatives are appointed by the board of directors,
these must also be registered, possibly with a copy of the board of
directors’ minutes enclosed.
Art. 291
The following must be entered in the Public Register and pub-
lished as an extract:
1. The date of acceptance of the articles,
2. the name and domicile of the company,
3. the objects and, if required, the duration of the company,
4. the amount of nominal capital actually issued, the nominal
value or quota of the individual shares or share units and the
amount actually taken up,
5. the legal form of the shares, whether they are bearer or regis-
tered shares as well as their preferential or conversion rights (if
any),
6. the amount of payment in kind, acquisitions and founders’
preference rights,
7. the members of the board of directors and the representatives,
with names, first names, profession and place of residence or
the name of the company and the domicile,
8. the form in which the board of directors makes known its
declarations of intent and the manner in which representation
is exercised,
9. the manner in which the company’s notices to the sharehold-
ers and third parties shall ensue.
In the case of domiciliary limited companies, it will be suffi-
cient if the entry in the Public Register is published by being dis-
played on the court notice board.
2. Registration
and publication

– 118 –
Art. 292
The vested rights of a shareholder or individual shareholders
shall be deemed to be those rights, provided in the articles or the
law, pursuant to the regulations of the law or the articles, which
are independent of the resolutions of the general meeting or the
board of directors or which appear as the prerequisite of partici-
pation at the general meeting.
These include membership, the right to vote, the right of re-
scission, the right to building interest, to dividends, to a share in
the liquidation surplus, if the articles do not limit or exclude indi-
vidual rights within the scope of this law.
Art. 293
In the absence of provisions to the contrary in the articles, the
approval of three-quarters of the votes represented at a general
meeting but of at least two-thirds of the representatives of all the
shares shall be required to pass a resolution of the general meeting
in the following cases:
1. The changing of the company’s objects,
2. the conversion of the limited company into another legal
entity,
3. the removal of the requirements provided in the articles which
render more difficult the passing of resolutions by the general
meeting.
Art. 294
An expansion of the company’s sphere of business, by the
adoption of related objects, or a contraction of such objects, or a
merger, whether by transition to or association with another lim-
ited company, the changing of the name or the domicile of the
company, or the dissolution before the time determined in the
articles may, unless the articles determine otherwise, only be de-
cided by a vote taken at the general meeting at which at least two-
thirds of all the shares are represented.
C. Protection of
the nominal
capital and the
shareholders
I. Protection of
vested rights
1. Protection of
the individual
2. Requirement of
the specially
conditioned
majority of the
general meetin g
II. Business
expansion,
business con-
traction and
mer
ger

– 119 –
If two-thirds of all the shares are not represented at a first gen-
eral meeting, a second meeting must be convened at least eight
days after the first at which the resolutions mentioned in the pre-
ceding or this Article may be passed even if only one-third of all
the shares is represented.
Art. 295
Insofar as special regulations are not drawn up in the follow-
ing, an existing limited company may issue new shares as, for
example, in the case of variable capital paid in, provided only that
the regulations drawn up for the formation of the company lim-
ited by shares are observed without, however, the nominal capital
as stated in the articles having to be fully paid up.
If shares have been issued below the nominal value, new shares
of this type may be issued again only after the deficiency arising
from the issue below par has been covered from the reserves or
the profit.
It is sufficient, however, if a person authorised to represent or
sign undertakes the registration in the Public Register.
The subscription for shares shall ensue with reference to the
resolution to increase the capital.
The increase in capital may be undertaken alone or in combi-
nation with a reduction of the existing nominal capital as, for
example, in the case of capital reconstruction.
Art. 296
Where new shares are issued as a counter-performance for the
contribution of tangible articles of property or rights, the resolu-
tion to increase the capital and to approve the payment in kind
and the rights can only be passed at a general meeting at which at
least two-thirds of the share capital must be represented after that
part which is in possession of payment in kind has been deducted,
and the majority must be comprised of at least two-thirds of the
votes represented.
The shareholders participating in the contribution of articles
of property or rights shall not be counted and shall have no vot-
ing right.
III. Issuance of
new shares
1. General
prere quisites
2. As counter-
performance
for payment in
kind and ri
ghts

– 120 –
Information relating to the articles of property and rights
brought in must be provided in the articles and, as when the com-
pany is formed, a special report must be submitted by the board
of directors as well as by an expert authority (if necessary) before
the resolution is passed. Such reports must be attached to the
document required to be drawn up concerning the resolution and
a certified copy of the reports must be deposited in the Public
Register files.
The preceding paragraphs shall not apply if the issuance of new
shares as a counter-performance for payments in kind and rights
ensues pursuant to the regulation concerning the formation of the
company limited by shares by simultaneous formation.
In addition, the judge may allow exceptions in extrajudicial
proceedings.
Art. 297
The issuance of new shares, whether these are to be added to
the existing shares, or whether they are to replace them, whether
the quantity or quota, or whether the amount is to be changed or
left unchanged, may ensue without the payment of capital in cash
or the contribution of tangible articles of property:
1. If, in place of company debts, shares with or without pre-
ference are issued to assenting creditors (repayment of debts
by shares), if the articles provide for this; a right, in particular,
may be conceded to bond creditors, already at the time bonds
are issued or, in the case of a loan being taken up, to the grant-
ers of a loan, enabling their bonds or their loans to be con-
verted to preference or ordinary shares, or an obligation may
be imposed in this regard (convertible bonds and/or loans),
according to which the regulations concerning capital increase
in the case of companies with variable capital shall be applied
analogously, with the exception of those regulations which
relate to the name and the limitation to registered shares,
2. by application of the reserve fund, other reserves and withheld
profits, insofar as a minimum reserve is not required by law
(revaluation upwards),
3. Issuance
without pay-
ment in cash or
kind

– 121 –
3. by adjusting the nominal value to the actual value of the assets
as, particularly, in the case of devaluation of money and con-
version to shares of the undisclosed reserves within such assets
(revaluation upwards),
4. in the case of the reduction of the nominal capital and the
share amount (devaluation),
5. in the case of the nominal capital or a part thereof being
changed to another currency and, likewise, the nominal value
of the shares or the quota (revaluation),
6. conversion of the preference shares to fully entitled ordinary
shares and similar.
Art. 298
1)
Art. 299
Pursuant to or by amendment of the articles the general
meeting may pass resolutions to take up new nominal capital or to
modify the existing nominal capital by issuing preference shares
(priority shares) with or without the ordinary shareholders having
the preferential right to acquire preference shares.
When preference shares are issued, the right may be reserved
to convert these to different shares, in particular to ordinary
shares or bonds with or without the right to vote or participate in
profits. In the latter case, however, the regulations concerning the
reduction of capital in the case of limited companies with variable
share capital shall be applied accordingly, but not those concern-
ing the company name and the restriction on registered shares
(convertible preference shares).
If the articles do not determine otherwise, shares which should
take precedence over preference shares shall, after such preference
shares have been issued, only be issued with the approval not only
of the general meeting of all the shareholders but also of a special
general meeting of the preference shareholders.

1) Art. 298 deleted by the law dated the 23. October, 1997, LGBl. 1997, No. 210.
IV. Issue of prefe-
rence shares
1. Authority to
issue

– 122 –
The same regulation shall also be observed in the case of the
subsequent amendment of provisions in the articles which confer
special rights on the preference shares.
The articles may determine that in order to raise new funds
without implementing an increase in capital, the shareholders may
be invited to contribute voluntarily a certain sum of money above
the nominal value of the shares and those shares for which an
additional payment was made shall be converted into preference
shares.
Art. 300
The passing of resolutions concerning the issuance of prefer-
ence shares or concerning the amendment or cancellation of the
preferential rights conceded to preference shares shall
be subject to the same regulations as those drawn up for
the resolutions concerning the expansion of the sphere of busi-
ness.
A resolution of the general meeting may be replaced by a
document in which all the shareholders approve by signature the
issuance of preference shares.
Art. 301
With preference over ordinary shareholders, preference share-
holders enjoy the preferential treatment specifically conceded to
them in the original articles or in the amendment of the article
amending resolution applying to the issuance of the preference
shares; otherwise, preference shareholders rank pari passu with
the ordinary shareholders.
The preferential treatment may extend in particular to the
right to vote, to the exclusive election of certain company bodies
as, for example, the board of directors, or the passing of resolu-
tions concerning certain objects designated in the articles, to the
dividend, with or without right to a cumulative dividend, to the
share of the liquidation surplus and to the right to subscribe to
new shares if such are issued.
2. Passing of
resolutions
3. Status of
preference
shares

– 123 –
If vested rights are not involved, the preference shareholders
are bound, as far as the bringing or waiving of their claims is con-
cerned, by the resolutions which may be passed by special general
meetings of the preference shareholders.
Unless the articles determine otherwise, the resolutions men-
tioned in the last paragraph must be passed with three-quarters of
all the votes of the preference shareholders.
Unless the articles determine otherwise, the trustee in bank-
ruptcy, in the event of winding up shall in the first instance call in
all the arrears on the ordinary shares and then, if these payments
are inadequate, the arrears on the preference and other shares, one
after the other, according to their legal status.
Art. 302
Shares which are handed over to the shareholders or third
parties without counter-performance or only in return for reim-
bursement of expenses, and are paid for by the company itself,
from a fund which is available in addition to the nominal capital,
from reserves formed out of profits or similar (bonus shares) may
be issued pursuant to the original or amended articles.
Their issue may also ensue with partial upward revaluation
and similar operations, or instead of dividend subscription rights
(dividend shares) or dividend-right certificates.
With the exception of the duty to pay a call on shares, the bo-
nus shareholder has the same duties and rights as any other share-
holder, such as the right to vote, the right to dividends, the right
to subscribe to new shares, unless the articles determine other-
wise.
Also permissible is the formal distribution to the shareholders
(bonus) of reserves pursuant to the articles which have accumu-
lated in this regard and the immediate repayment or settlement of
the amount in return for the transfer of shares by the company
(false bonus shares).
V. The issuance of
bonus shares

– 124 –
Art. 303
Unless the articles provide otherwise, the existing share-
holders, including the bonus shareholders, have a reversionary
right to subscribe to new shares.
The subscription right may also be such that shareholders have
a right to subscribe to the shares of an existing company or of a
company yet to be formed, as in the case of an exchange issue, or
in another manner.
The conceding of subscription rights for shares to be issued in
the future, before the resolution is passed to increase the capital,
may be provided for in the articles with the approval of the Reg-
ister Authority in extrajudicial proceedings with the proviso that
this concession must be restricted to a certain issue and the
amount of capital increase may not be higher than the sum of the
issue vested with the subscription right.
The duty may be imposed upon registered shareholders to
subscribe to new shares to an extent determined in the articles,
pursuant to the regulations applying to additional service shares.
In the absence of other provisions, the subscription right and
the obligation to subscribe apply to the current owner of the
shares. The subscription right is a part of the share but not a
benefit; the obligation to subscribe is a burden on the registered
share.
Special transferable securities may be issued via the subs-
cription right of the shareholders.
The subscription right in the case of convertible bonds or
loans is reserved.
Art. 304
Pursuant to the original articles or by means of an amendment
of the articles, the general meeting may vote to issue dividend
right certificates having the character of securities for the benefit
of the founders or such persons who are or were associated with
the undertaking on the basis of capital participation, the owner-
ship of shares or a creditor’s claim or work or in another manner.
VI. Subscription
right and obli-
gation to sub-
scribe
VII. The issuance
of dividend
right certifi-
cates

– 125 –
The dividend right certificates do not confer company mem-
bership on the entitled persons, but solely a conditional creditor’s
claim, whether to a share of the net profit or to a share of the
liquidation surplus or also a right to subscribe to new shares or to
one as well as to the other.
Unless the articles provide otherwise, the right to subscribe to
new shares may be withdrawn by the issue of dividend-right cer-
tificates for not more than half of the new shares to be issued in
the individual case.
The passing of resolutions concerning the subsequent issue of
dividend-right certificates is subject to the same regulations as
those drawn up for resolutions concerning the conceding of
founders’ preferential rights at the time the company is formed.
The community of loan security creditors shall apply to the
holders of dividend right certificates with the proviso that reso-
lutions of the holders of dividend right certificates may be passed
with a simple majority, unless determined otherwise in the reso-
lution concerning the issuance of the dividend right certificates.
If the company is in a state of bankruptcy, the holder of divi-
dend-right certificates may, if his claim is for a definite share of
the profit, put forward such claim as a claim in bankruptcy, and, if
his claim is for a dividend, he may only put this forward if the
payment of a dividend had been non-appealably declared before
the adjudication of bankruptcy.
Art. 305
Pursuant to the law, a public document or a document signed
by all assenting voters must be drawn up for each resolution of
the general meeting whose object is to amend the provisions of
the articles.
The application for registration of the resolution must be
made either by all the members of the board of directors or by a
member with authorisation to represent and sign, and entry in the
Public Register and publication ensues on the basis of the same
disclosures as in the case of the original articles; legal effect is
acquired only after entry in the Public Register.
VIII. Documen-
tation and
registration
of article
amendments

– 126 –
If an increase in the share capital is involved, the determination
of the subscription and the necessary and actual payment on
shares shall be entered on the basis of a declaration of a person
authorised to represent and sign. Such entry shall be in addition
to the registration of the resolution relating to the amendment of
the articles. The regulations concerning the issuance of new shares
as the counter performance of contributions in kind and rights
remain reserved.
Art. 306
The company limited by shares may not acquire its own shares
for valuable consideration; moreover, it may not accept such
shares as a pledge. An exception to this prohibition ensues:
1. If the acquisition is undertaken in connection with an amorti-
sation pursuant to a provision of the law or the articles,
2. if undertaken in accord with the regulations of the law and the
articles for the partial repayment of the nominal capital,
3. if the acquisition is made to satisfy the company’s own claims
and is necessary to safeguard the company’s interests,
4. if the acquisition or the acceptance of a pledge is associated
with the operation of a branch of the business, belonging to
the undertaking, pursuant to the company’s objects as pro-
vided in the articles,
5. if it takes place together with that of an impersonal entity.
In the first and second cases, the re-acquired shares must be
immediately rendered unsuitable for all further disposal and in the
third, fourth and fifth cases they must be disposed of as quickly as
possible.
The acquisitions and disposals which take place during the
year as well as the company’s own shares as security for borrow-
ing, at hand at the end of the year, must be shown in the annual
report, and these shares may not be represented by the company
at general meetings.
IX. Acquisition of
the company’s
own shares

– 127 –
Art. 307
As long as the company exists each shareholder has a claim to
a proportional share of the net profit as determined from the an-
nual balance sheet, insofar as this is intended for distribution to
the shareholders pursuant to the law and the articles.
In the event of the company being dissolved, the shareholder
shall have the right to a proportional share of the liquidation pro-
ceeds unless the articles provide otherwise under reservation of
the vested rights.
The preferential rights provided in the articles for individual
classes of shares are reserved.
Art. 308
Unless the articles provide otherwise, the shares of the profit
and the liquidation proceeds shall be calculated in proportion to
the amounts paid in.
A shareholder shall not have the right to reclaim payments in
cash or kind either before or during the dissolution of the com-
pany.
For company notices to the public concerning dividends and
with the exception of domiciliary undertakings, these are to be
stated as per hundred of the nominal share amount if the amount
is given in percent when non par shares are not involved; other-
wise, this shall be as per hundred of the share capital plus all re-
serves.
Art. 309
Each year, by operation of the law, a sum amounting to one-
twentieth of the net profit must be allocated to a general reserve
fund until such fund amounts to one-tenth of the nominal capital.
If shares are issued below the nominal value, a sum amounting
to a further one-twentieth of the net profit must, by operation of
the law, be allocated each year to the general reserve fund until
the nominal share value has been reached.
D. Share-holders
rights and
duties
I. Shares of profit
and liquidation
proceeds
1. In
general
2. Method of
calculation
II. Reserve fund
1. Reserve fund
re
quired b y law

– 128 –
Surplus proceeds obtained from the issue of shares above their
nominal value shall be allocated to the same fund, even after the
legally required amount has been reached, unless such surplus
proceeds are required to cover the costs of issuing the shares, or
for marking down or for welfare purposes or for the profit-
sharing of staff or workers. A further allocation shall be made to
the same fund from that amount of the contributions left over
from the shares declared null and void after a possible deficit in
the proceeds from the shares issued has been covered.
This fund may only be used to cover balance-sheet losses.
Art. 310
The articles may provide for higher contributions to the re-
serve fund.
The articles may provide for further funds and determine their
application and purpose such as, in particular, a welfare fund, a
renewals fund and an amortisation fund.
Art. 311
The dividend may not be determined before the contributions
to the reserve and other funds pursuant to the law and the articles
have been deducted from the net profit for payment into the re-
serve and other funds as determined by the law and the articles.
The general meeting is also empowered, before the dividend is
determined, to pass resolutions to establish such reserve funds as
are not provided for in the law or the articles if such action ap-
pears appropriate for the safeguarding of the undertaking or
achieving a dividend which is as uniform as possible.
The regulations concerning the socio-political rights to a share
and to profit are reserved.
Art. 312
Interest on the share capital may not be paid or promised.
Dividends shall result solely from the net profit, as shown in the
annual balance sheet, with reservation of a distribution based on
an interim balance sheet, or shall be available from reserves accu-
mulated for this purpose.
2. Reserve fund
provided in the
articles
3. Relationship of
the profit share
to the reserve
assets
III. Dividends,
building inter-
est, directors’
remuneration,
etc.
1. Dividends

– 129 –
The articles may determine that the board of directors or an-
other body, without prior resolution of the general meeting, may
distribute dividends on the preference shares at fixed times during
the year, e.g. at six-monthly intervals. Such distributions, whose
scope shall be described in detail, shall be derived from the profits
(surplus) brought forward from the previous business year or
from a special reserve fund.
In the absence of other provisions in the articles, the dividends
shall be paid in cash.
If the articles make such provision, dividends may also be paid
to parties other than shareholders, such as insurance policy hold-
ers, subsidiary and associate companies, charitable undertakings.
The articles may provide for the payment of dividends by
means of coupons, but also in other ways, by cheque, for instance,
and similar.
Dividends whose payment has been approved pursuant to the
law and the articles before the initiation of the company’s bank-
ruptcy may, as well as a dividend according to para. 2, be the
subject of a claim in bankruptcy.
Art. 313
Interest at a certain rate may be stipulated for the shareholders
at the expense of the investment account for the time required to
build and prepare the undertaking up to the commencement of
full operation.
The articles must determine the latest date when the payment
of interest shall cease.
If new share are issued for the expansion of the undertaking,
the resolution to increase the capital may concede a certain pay-
ment of interest to the new shares at the charge of the investment
account for the period up to the time of going into operation.
Payments for building interest must be entered on the assets
side and the entry must be paid off from the profits as quickly as
possible.
The claim for the building interest which accrues before the
adjudication of the company’s bankruptcy may be made as a
claim in bankruptcy.
2. Building
interest

– 130 –
Art. 314
The payment of dividends to members of the board of direc-
tors, the audit authority or other bodies provided for in the arti-
cles is only admissible after the contribution has been made to the
legal reserve fund and a dividend of 5% or more if a higher per-
centage is determined in the articles has been paid to the share-
holders.
Art. 315
In addition to or in place of the claim to dividends, the share-
holders may be granted the right to use or the right to usufruct of
the company’s assets which, however, may not reduce the balance
of the company capital and shall lapse in the event of bankruptcy.
Art. 316
The claim to dividends, building interest and management fees
and, in the case of the right to use and the right of usufruct, the
claim to individual performances, shall fall under the statute of
limitations upon the expiration of three years after their due date.
The existence of the right to use and the right of usufruct is
determined by the right of membership.
Art. 317
Except in the case of additional performance shares, the share-
holder is not liable to contribute more to the objects of the com-
pany and to the fulfilment of its obligations than the amount de-
termined by the company at the time of issue for the allocation of
a share.
Except in the case of the nominal capital being reduced, the
shareholder cannot be granted either a release from or a respite
for payment of this amount, under reservation of the provisions
concerning the shareholder’s liability.
3. Management
fees
4. Other claims
IV. Statute of
limitations
V. The sharehol-
ders’ liability
1. Ob
ject

– 131 –
Art. 318
In addition to the fixed share sum, the articles may determine,
without inclusion in the share capital and without being taken
into consideration in the balance sheet, that the obligation may be
imposed on the shareholder to effect non-recurring or recurring
cash or other contributions, including defaults, or to effect further
limited contributions or to accept limited liability, although the
articles may determine joint and several liability, up to a sum
amounting to twice the nominal value of the shares, pursuant to
the relevant regulations applying to cooperative societies and in
this case the imposition of liability and the duty to make further
contributions shall ensue by allocation procedure.
Where such companies are concerned, insofar as the shares
with additional performance are involved, only registered shares
may be issued, which shall be transferable with the assent of the
company.
The obligation and the scope of the contribution must be indi-
cated on the share or the interim certificate and an amendment of
the articles reaffirming such obligations or extending existing ones
is only permissible with the assent of all the shareholders thereby
affected.
The articles must determine a penalty for the case where such
obligation towards others to effect contribution other than
monetary payments is not fulfilled or not fulfilled in due form or
where a shareholder renounces his shares even when they are fully
paid up. Otherwise, every shareholder shall have the right to re-
turn his shares after they have been fully paid up, in the same way
as a partner in a partnership limited by shares when a limited
liability does not exist.
The company may only refuse to approve the transfer of
shares for important reasons. In the case of approval being with-
held, the transfer may, under these prerequisites, be approved by
the judge in extrajudicial proceedings.
The obligation to effect individual contributions of this kind
shall fall under the statute of limitations three years after their due
date.
2. Additional
contributory-
shares
a. In
general

– 132 –
Art. 319
Periodic non-monetary contributions, for which shareholders
are liable in addition to payments for capital, may not exceed the
value which forms a creditor’s claim and may be remitted regard-
less of whether the annual balance sheet shows a net profit.
Only dividends may be paid out for periodic contributions.
The claim for remittance or reimbursement of individual con-
tributions shall fall under the statute of limitations three years
after their due date.
Art. 320
A shareholder who fails to pay at the right time the sum due
for his share shall be liable to pay interest on default payment by
operation of the law.
Moreover, the board of directors has in all cases the right to
declare forfeited the defaulting shareholder’s entitlement accruing
from the subscription to the shares and from the partial payments
already made and to issue new shares in place of those withdrawn.
The articles may also provide for the imposition of a penalty
on the shareholder for such default.
Moreover, the regulations concerning the additional perform-
ance shares, in the case of which the declaration of forfeiture may,
in the absence of articles to the contrary, ensue on grounds of
undue delay in the execution of the additional performances, also
are reserved.
Art. 321
A shareholder can only be penalised by the imposition of a
penalty and his rights accruing from the share and the subscrip-
tion be declared forfeited if the request to pay on shares has been
published at least twice in the journal used for such purpose, the
last time at least two weeks before the final date fixed for pay-
ment, or, if the request was communicated to him by registered
letter, within the same period of time.
b. Remittance
3. Consequences
of undue delay
a. Pursuant to law
and articles
b. Request to
perform

– 133 –
Where the shares are issued to a named person, a special single
communication by registered letter takes the place of the public
request in all cases. The communication is sent to the individual
shareholders entered in the share register at least four weeks be-
fore the final date fixed for payment.
Insofar as he is personally liable, the defaulting shareholder is
liable to the company for the amount which is not covered by the
issuance of the new shares.
Art. 322
Issued share documents or interim certificates are subject to
the regulations concerning securities, unless special provisions are
drawn up in the foregoing regulations concerning share docu-
ments or in the following provisions.
Up to the time such securities are issued, the legal relationship
between the subscriber and his possible successors and the com-
pany is subject to the general provisions of the Code of Obliga-
tions, in particular to the regulations concerning the assignment
of claims and the assumption of a liability.
To what extent a transfer of the legal relationship takes place
by means of the transfer of deposit slips for deposited registered
shares, blocked shares and interim certificates shall be assessed for
the individual case.
Art. 323
Bearer shares may only be issued after a sum determined in the
original articles has been paid in; such sum must amount to at
least half of the nominal value.
If such a sum is not determined in the articles, the issue of
shares to the bearer is admissible only after the full nominal value
has been paid in.
Bearer documents issued beforehand shall be null and void and
the subscribers and shareholders remain subject to the regulations
concerning shareholders in general, up to the time of the payment
stated.
Bearer shares are transferable to the bearer as securities.
VI. Legal relation-
ship of the
shareholders
1. In
general
2. In the case of
bearer shares
a. The issuance of
bearer docu-
ments

– 134 –
Art. 324
Even if he transfers his entitlement to another person and such
person accepts the liability to pay, with or without the approval
of the board of directors, the subscriber remains liable for pay-
ment, up to the amount determined by the law and the articles,
with his entire assets and legal action can be taken by the com-
pany, even if the share has been transferred to a third party if, in
spite of due demand by the board of directors, he fails to comply
with his duty to pay, and in consequence the share shall be de-
clared cancelled.
If no provision has been made for the release of the subscriber
from further payments regarding the amount determined in the
articles or by the law or if the company is wound up within one
year of being entered in the Public Register, the subscriber can
still be required to make further payments, even though he no
longer has the share.
Art. 325
After the bearer share has been issued, the bearer at the time,
who is not the subscriber, is not, in the absence of another agree-
ment, liable personally for further payments. However, only in-
sofar as a due payment is not met, his right accruing from the
share may, pursuant to the provisions concerning the conse-
quences of undue delay in the case of delayed payment, be de-
clared forfeited.
This limitation of liability, however, is not effective if within
one year of being entered in the Public Register the company is
wound up and the bearer, for his part, has not made the payment
and his right accruing from the share has therefore been declared
forfeited.
If interim certificates are issued for the registered share, which
can only be issued to a named person, they shall be subject to the
regulations concerning registered shares.
Art. 326
The subscriber who is called upon by the company to pay on a
share which has been disposed of has recourse to the present share-
holder or subsequent bearer of the share by operation of the law.
b. The subscriber’s
liabilit y
c. Liability of the
bearer
d. Recourse of the
subscriber

– 135 –
In the absence of any other agreement, however, such share-
holder or bearer is liable to the subscriber only with the share
itself.
Art. 327
Unless the articles determine otherwise, registered shares are
freely transferable, also by blank endorsement, and in case of
doubt shall be deemed to be instruments to order.
In order to transfer the registered shares, it is only necessary to
deliver the endorsed share title to the purchaser.
The preclusion of the transferability of a share shall not be
valid in the case of succession upon death, levy of execution and
writ or bankruptcy. However, the purchaser is obliged and enti-
tled to assign the share to the company in exchange for reim-
bursement amounting to the value shown in the last annual bal-
ance sheet.
Registered shares which are not fully paid up or interim certifi-
cates, which are only transferable with the assent of the company,
may only be validly transferred during bankruptcy proceedings
with the assent of the trusteeship in bankruptcy.
Art. 328
The company must record the owners of registered shares in a
share register in which names, addresses or company name and
domicile of the shareholders shall be recorded.
As soon as such a share register has been established, those
persons who are entered therein shall be considered to be share-
holders in relation to the company.
Entry shall ensue on the basis of an identification document
referring to the transfer of the share which has taken place by
succession upon death, upon notification by the heirs and/or the
probate authority and upon the dissolution of a firm or legal en-
tity on notification by the successor in title.
The completed entry shall be noted by the company on the
share document.
3. In the case
of a Registered
share
a. Transfer
b. Entry in the
share re
gister

– 136 –
Art. 329
The company may refuse to make entries in the share register
for the reasons stated in the articles.
If the articles do not contain provisions concerning this mat-
ter, entry in the share register may only be refused for important
reasons.
In the case of shares which are not fully paid up, the purchaser
shall give an undertaking to effect the further payments and the
board of directors shall examine the purchaser’s solvency and, if
necessary, demand security. If such security is not provided, entry
in the register shall be refused.
In the case of acquisition as the result of succession upon
death or by virtue of the law on matrimonial property, entry in
the Share Register may only be refused if the company limited by
shares or the shareholders declare their readiness to take over the
shares at the current price.
Art. 330
The acquirer of a registered share which is not fully paid up is
under obligation to the company to effect payment as soon as he
is recorded in the share register.
The transferor, who is not the subscriber, is thereby released
from the duty to pay, the subscriber, however, remains liable,
despite the transfer to the new acquirer, if the company is wound
up within one year of being entered in the Public Register, and
the company may take legal action against him as soon as the
successor in title fails to meet his obligation to pay, despite being
called upon in due form and in consequence, his share has been
declared invalid by the board of directors.
Art. 331
As long as shares have not been fully paid up, whether these
are bearer or registered shares, the amount actually paid in shall
be clearly stated on every document.
Furthermore, where reference is made to the share capital in
any public notices by the company (announcements, circular
letters, reports, letter headings, etc.), the amount of share capital
actually paid in shall be clearly pointed out.
c. Refusal to
record
d. Liability of the
registered
shareholder
VII. Declaration
that shares are
not fully paid
u
p

– 137 –
The Public Register shall be notified by the board of directors
concerning the sum of the further payments on the share capital
and, like the provisions of the articles, this shall be published.
Art. 332
The rights to which the shareholders are entitled relating to
the affairs of the company, particularly with regard to the con-
ducting of business, the examination of the balance sheet, the
calculation of the profit and the distribution of the profit, shall be
exercised at the general meeting of the shareholders, unless the
law provides for an exception.
Each shareholder entitled to vote shall be at liberty to repre-
sent his shares personally at the general meeting or, unless the
articles determine otherwise, to delegate a third party, who need
not be a shareholder, to represent him.
If registered shares are concerned, the representative must be
provided with written authorisation, unless the articles determine
otherwise.
All the shares owned by one shareholder must be represented
by a single person. In this case, however, the regulations con-
cerning the trust are reserved.
Art. 333
The borrowing or lending of shares for the purpose of exer-
cising the right to vote at the general meeting is inadmissible; so,
too, is any other exercise of the right to vote by anyone but the
owner if this leads to the circumvention of a voting right restric-
tion.
Each shareholder shall be entitled to object to the board of di-
rectors concerning the participation at the general meeting of a
person not entitled to vote, unless the law or the articles make
provision for an exception.
Art. 334
By virtue of the law, the right to vote commences as soon as at
least 20% has been paid in on the share.
The articles may determine that after the expiration of six
months following the formation of the company or the issuance
VIII. Personal
membership
rights
1. Participation
in the general
meeting
a. In
general
b. Unauthorised
partici pation
2. The right to
vote at the gen-
eral meeting
a. In
general

– 138 –
of new shares, only those shareholders shall be entitled to vote
who can prove a period of share ownership of at least six months.
The shareholders shall exercise their voting right at the general
meeting in proportion to the number of shares they own and the
same voting right shall be conferred upon all shares in proportion
to their nominal value or quota, unless the articles determine oth-
erwise.
Each shareholder, even if he owns only one share, shall have at
least one vote.
Art. 335
The company may reserve in its articles the right to restrict the
number of votes of the bearers of several shares or provide in the
articles that shares confer the right of several votes (plural shares)
or confer different voting rights.
In the latter case, a majority resolution is passed only if each
group of shares, for its part, approves a motion with a majority.
It may be determined in the articles that preference shares or a
category of such may be conceded a preference to the effect that
their voting right shall be increased in relationship to the other
votes with each increase in the capital or the introduction of other
voting shares or by raising the preference shares’ voting rights,
also according to a certain ratio (voting right on a sliding scale).
With the approval of the Registrar, a similar or different vot-
ing right may also be conferred upon the creditors of convertible
loans or other bearers of convertible bonds, pursuant to detailed
determination in the articles.
Art. 336
Ten days at the latest before the ordinary general meeting is
due to take place, the balance sheet and the profit and loss ac-
count together with the auditors’ report and the business report
shall be made readily available for the shareholders to examine at
the domicile of the board of directors.
If bearer shares are issued, the announcement of such issue
must ensue in those public journals intended for such announce-
ments.
b. Voting shares
and bonds with
votin
g rights
3. The share-
holders’ right
of verification
a. Right of
disclosure of
balance sheet

– 139 –
Instead of by means of public announcement, registered
shareholders whose names are recorded in the share register shall
be informed by special notification.
Where domiciliary limited companies or family limited com-
panies are concerned, the announcement, unless the articles de-
termine otherwise, shall be made by the judge in extrajudicial
proceedings, with a notice displayed on the court notice board.
Art. 337
The shareholders shall be entitled to point out doubtful entries
to the audit authority and to demand the necessary explanations
from the audit authority and the board of directors.
With the authorisation of the general meeting or with the
permission of the board of directors or by order of the court in
extrajudicial proceedings after the board of directors has been
heard, the shareholders shall be allowed to examine the books of
account and the correspondence. Business secrets must be given
the necessary consideration.
The shareholders’ rights of verification cannot be rescinded or
restricted, either by the articles or by resolution of the general
meeting. However, the regulations concerning trust certificates
are reserved.
Art. 338
The supreme authority of the limited company is the general
meeting of the shareholders which expresses the company’s in-
tentions to the shareholders and the governing bodies.
The powers of the general meeting include:
1. The appointment of the board of directors and the audit
authority,
2. the approval of the balance sheet and determination of its re-
sults and the dividends,
3. the release of the administration and the audit authority,
4. the passing of resolutions concerning the acceptance and
amendment of the articles and, insofar as the articles do not
determine otherwise, the establishment of branches,
b. Right to
supervise the
board of di-
rectors
E. Governing
bodies
I. General meet-
ing
1. Powers

– 140 –
5. the passing of resolutions concerning the matters reserved by
the law or the articles for the general meeting or submitted to
it by other bodies.
However, the articles may transfer to another body, com-
pletely or partly, the duties of the general meeting pursuant to the
law and the articles.
Art. 339
An ordinary general meeting shall take place every year within
six months of the close of the business year. Extraordinary
general meetings shall be convened as required.
The general meeting shall be called in the manner determined
in the articles and on each occasion the notice shall include an
agenda for the general meeting which shall state clearly and com-
pletely the matters to be dealt with.
Exceptions pursuant to the law or the articles are reserved.
Art. 340
If the nominal capital is reduced by one-half and the articles
make such provision, a resolution of the general meeting con-
cerning the dissolution of the company shall be valid when the
assenting majority of shareholders who have approved the disso-
lution represent one-quarter of the nominal capital.
Other cases, for which the law or the articles stipulate a special
majority or the unanimity of the votes represented at the general
meeting, are reserved.
Art. 341
The members of the board of directors shall be appointed by
the general meeting. Initially, the appointment shall be for a
maximum of three years and thereafter for a maximum period of
six years.
For the first three years, the members of the board of directors
may be designated in the articles.
For the protection of the minority of the shareholders, the ar-
ticles may include provisions concerning the method of election
2. Convenin g
3. The passing of
resolutions
II. Board of
directors
1. A
ppointment

– 141 –
and, in place of election by the general meeting, provide for elec-
tion by the shareholders with ballot box or by delegates.
If persons are elected who, in order to perform their duties,
are required to deposit shares and if, according to the articles,
only shareholders may be members, such persons may not take up
office until they have become shareholders by acquiring shares.
The provisions concerning the defined mandate for the ad-
ministration are reserved.
Art.342
Where the articles so determine, the members of the board of
directors must deposit, for the duration of their term of office, the
number of shares stated in the articles.
With the approval of the board of directors, such deposition
may also be undertaken by a third party.
The articles may determine that in every case the deposited
shares shall be issued in or transferred to the names of the indi-
vidual members.
Art. 343
For the duration of the deposition, the deposited shares are in-
alienable.
They provide the company, the shareholders and the creditors
with a pledge as security for their claims arising from the respon-
sibility of the members of the board of directors.
They may not be withdrawn before release has been granted.
Art. 344
Where the administration is entrusted to several persons or
firms, these form the board of directors, whose powers may be
defined in detail in the articles or in special regulations.
Companies limited by shares whose nominal capital amounts
to at least one million Swiss francs must have a board of directors
comprising at least three members, unless the companies con-
2. Deposition of
shares
a. Manner of
de
position
b. The effect of
this
3. Board of
directors
a. Appointment
and procedure
in
general

– 142 –
cerned are only domiciled in the Principality of Liechtenstein,
with or without an office, or only administer assets, but do not
conduct other business in Liechtenstein.
Art. 345
The board of directors shall designate a president and the
other members of its committee insofar as this is provided for in
the articles or in a regulation admitted by the articles, or is con-
sidered by it to be necessary.
Minutes shall be kept of its resolutions, which shall be signed
by the chairman.
Art. 346
The articles may determine that absent members of the board
of directors may be represented at a meeting by another member
or by a substitute whose name is recorded in the Public Register.
The relevant powers of agency must be granted for a particular
meeting and be attached to the minutes.
No member may represent more than two other members.
Art. 347
The board of directors may appoint one or several committees
comprised of members drawn from its own ranks, whose duty in
particular shall be to supervise the course of business, to prepare
the business to be submitted to the board of directors, to report to
the latter on all important matters also, in particular, concerning
the drawing up of the balance sheet, and to supervise the imple-
mentation of the resolutions of the board of directors.
Art. 348
The articles may determine that management and representa-
tion may be transferred by the general meeting or the board of
directors to one or several persons, members of the board of di-
rectors (delegates) or third parties, who need not be members of
the company, who are then also subject to the regulations con-
cerning responsibility.
b. Procedure for
business
c. Represen
tation
d. Committees of
the board of
directors
e. Transfer of
management
and repre-
sentation to
s
pecial bodies

– 143 –
If they are entrusted with the conduct of the entire business,
they shall form the management.
Persons (firms) entrusted in this manner with the conduct of
the business and representation are bodies of the company.
Art. 349
The duties of the board of directors shall be:
1. To prepare the agenda for the general meeting and to imple-
ment its resolutions,
2. to draw up the rules necessary for the orderly conduct of
business and to instruct management accordingly,
3. to supervise the persons entrusted with management and rep-
resentation, having regard to the correct execution of the latter
pursuant to the law, the articles and the regulations and,
4. with this aim in view, to be regularly informed concerning the
course and the conduct of business.
The board of directors shall also be responsible for the min-
utes of the general meeting and of the board, for the necessary
business records being properly kept and for the annual balance
sheet being drawn up in accordance with the legal regulations ,
audited and, if required, published.
Art. 350
1)
In all cases, the supreme body shall elect an audit authority.
Art. 351
In the case of the dissolution of a limited company, brought
about by the take-over of such company, with assets and liabili-
ties, by another limited company as universal successor in title,
the following provisions shall be applied, with the exception of
the regulations applying to a resolution to merge, where the
transferee company decides to increase its capital by merging with
another and the company to be taken over decides to dissolve by
merging with another:

1) Art. 350 in the version of the law dated 15 April, 1980, LGBl. 1980 No. 39.
f. Duties of the
board of di-
rectors
III: Audit authorit
y
F. Merger
I. Take-over of
one limited
company by
another

– 144 –
1. The assets of the dissolved company shall be administered
separately until, according to judicial discretion in extrajudicial
proceedings, the company’s creditors are satisfied or safe-
guarded.
2. The legal venue of the company shall remain unchanged for
the duration of the separate assets administration; such ad-
ministration, on the other hand, shall be conducted by the
transferee company and any action or the like shall be taken
against the latter.
3. The members of the board of directors of the company taking
over shall be responsible to the creditors jointly and severally,
without limitation, for the separate administration.
4. The dissolution of the company and the take-over by the other
company must be notified by each management concerned for
registration in the Public Register.
5. After registration of the dissolution, the shares of the trans-
feree company which are to be granted by way of settlement,
shall be delivered to the shareholders of the dissolved com-
pany.
6. The public demand of the creditors of the dissolved company
may be postponed; the consolidation of the assets of the two
companies, however, is only admissible at the time when a
distribution of the assets of a dissolved company to the share-
holders may ensue.
7. In the relationship of the dissolved company to the transferee
company and its creditors, the assets taken over and whatever
may be acquired by transaction or in another way with the re-
sources of these assets, up to the expiration of the six-month
waiting period, shall be deemed to be the assets of the dis-
solved company up to the time of the admissible consolidation
of the two companies; and the creditors of the dissolved com-
pany, in the absence of an opposing provision in the resolution
concerning the decision to merge, may demand preferential
satisfaction in execution and bankruptcy proceedings, not-
withstanding their claims for payment against the transferee
company.

– 145 –
8. Subscription to shares is not required for the capital increase
needed for the take-over by the transferee company and ex-
isting subscription rights and duties shall not apply for these
new shares.
9. The transfer of the assets to the transferee company takes
place, without delay, with the registration of both parties’
resolutions. However, the items of property whose transfer
necessitates registration in Public Registers, such as the Land
Register or similar may not be at the disposal of the transferee
company until the prescribed transfer has been entered in the
Public Registers.
Art. 352
By the formation of a new limited company, several limited
companies may be taken over in such a manner that the assets of
the present companies are transferred, without liquidation , to the
assets of the company to be newly formed.
The regulations concerning take over by another limited com-
pany and, in addition, the following provisions shall be applied in
the case of such a merger:
1. In a public document or in a document signed by all the
shareholders, the several companies must conclude a merger
agreement in which they declare that the companies shall be
dissolved and that they intend to form a new company and
appoint the necessary company bodies.
2. Simultaneously, in a public document or in a document signed
by all the shareholders, they must determine the articles of the
new company, confirm the taking over of all the new com-
pany’s shares and their payment by the bringing in of the as-
sets of the present companies, and nominate the necessary
bodies of the new company.
3. The merger and formation agreement must be approved by the
general meeting of each of the previous companies.
4. The shares of the new company shall be delivered pursuant to
the merger agreement after the resolutions of approval have
been passed and the new company has been entered in the
Public Register.
II. Merging of
several limited
com
panies

– 146 –
Art. 353
Where the dissolution of a limited company ensues in conse-
quence of a take-over by a partnership limited by shares, the
partners of the latter with unlimited liability become the debtors
for the debts of the dissolved limited company.
Otherwise, the regulations concerning a take-over by a limited
company shall be applied analogously.
Art. 354
If, with reservation of the regulation concerning dissolution
without liquidation under the general regulations, the assets of a
limited company are taken over by the State or a Liechtenstein
commune with state guarantee, it may be agreed, with the ap-
proval of the general meeting, that liquidation shall not take place.
The resolution of the general meeting shall be drawn up pur-
suant to the regulations concerning dissolution and entered in the
Public Register.
The transfer of the company’s assets, including the debts, is
executed with the entry of this resolution in the Public Register
and the name of the company extinguished.
If the transfer of real estate or other rights pursuant to land
registry law is concerned, such transfer shall ensue on the basis of
the entry in the Public Register.
Art. 355
Repayment of the nominal capital to the shareholders or a re-
duction of the nominal capital may ensue only on the basis of a
provision of the articles with a resolution of the general meeting
in compliance with the requirements pursuant to the law and the
articles.
If an adequate, special cover for the payment of the existing
creditors is not available or will not be newly created within the
scope of the capital reduction or the creditors agree to the reduc-
tion, the repayment or reduction may ensue only on condition
that the provisions applicable to the distribution of the company’s
assets in the case of dissolution are observed.
III. Take-over by a
partnership
limited by
shares
G. Transfer to the
communit
y
H. Repayment and
other reduc-
tions of the
nominal capital.
I. Resolution to
repay and re-
duce, etc.

– 147 –
In the case of the nominal capital being reduced as the result of
loss, the shares issued earlier will be affected by this before those
issued at a later date if different classes of shares were issued and
at the time of issue it was not determined, for instance, which
class of shares should have preference over another class with
respect to the liquidation surplus.
In the case of a straighforward reduction, the agreement of the
creditors shall be presumed if they do not give notification of
their claims within the six-month waiting period.
If the company becomes bankrupt before expiration of the six-
month waiting period, the shareholder, unless repayment with
reservation of return payment is involved, may make his claim on
the repayment quota only in competition with the creditors who
have become creditors since the commencement of the six-month
waiting period. If, however, the company becomes bankrupt after
the expiration of that six-month waiting period, the shareholder
may make his claim in competition with all the company’s credi-
tors, insofar as the old creditors did not register their claims or
they were otherwise not shown in the books of account and con-
sequently payment or the provision of security did not ensue.
Art. 356
It may be determined in the articles that the board of directors
or another body is empowered, without a company resolution
and without observing the provision concerning the repayment of
capital to the shareholders, to repay to the shareholders a part of
the nominal capital which, however, may not fall below 20%, or
50% if bearer shares have been issued, on each share, on the ex-
press understanding that the amount shall be paid in again at a
later date on demand of the same or another company body.
Such capital repayment shall be recorded in the Public Regis-
ter; publication of the entry, however, shall be at the discretion of
the Register Authority.
II. Repayment of
capital with
reservation of
return
payment

– 148 –
Art. 357
If the legal prerequisites exist for the reduction of the nominal
capital, such reduction may be undertaken, also by way of share
consolidation, with the approval of the shareholders.
If a resolution to consolidate and reduce the number of shares is
passed with a three-quarters majority of all the votes at the gen-
eral meeting, the shares of the shareholders who did not vote in
favour shall be forfeited to the company and by way of settlement
they may be paid in cash according to the result of a winding up
balance-sheet.
Art. 358
Compulsory amortisation is only admissible if provided for in
the original articles or, in the case of new shares being issued, in
the amended articles which preceded their subscription. On the
other hand, amortisation by means of the voluntary acquisition of
the shares is admissible, even if not provided for in the articles.
If the repayment is undertaken from the nominal capital, such
repayment, if new share contributions are not created to the ex-
tent of the capital reduction, is only admissible if the provisions
drawn up for the case of the capital being reduced are observed
for the protection of the creditors.
If, on the other hand, amortisation ensues from the net profit
or from reserves, these provisions need not be observed. In this
case, however, a sum equal to the amortised shares must be en-
tered on the liability side of the balance sheet.
Art. 359
In the case of the provision of an amortisation of the share
capital out of the net profit, the articles may determine that this
may be undertaken by the board of directors or another company
body by redemption or drawing of the shares, without observing
the procedure for reducing the capital.
The acquired or repaid shares must be destroyed and the share
capital reduced accordingly.
III. Consolidation
and reduction
of the number
of shares
1. Amortisation
1. Preconditions
2. Redemption
and drawin
g

– 149 –
Art. 360
In the case of shares being drawn, the articles may determine
that transferable bonus shares (substitute shares) shall be issued
for the drawn and repaid shares. Such bonus shares shall not have
a par value, but shall embody membership rights, in particular the
right to vote, the right to a share of the net profit and of the liqui-
dation surplus.
Moreover, with the assent of the Registrar, bonus shares may
also be issued in other cases.
Art. 361
Unlike the regulations relating to a fixed capital, the articles of
a limited company which issues registered shares exclusively may
determine that the increase of the company capital may ensue by
the gradual issue of new shares to existing shareholders or third
persons and the reduction of the nominal capital by the gradual,
total or partial, repayment of the company capital by the redemp-
tion of shares without, in this regard, having to observe the pro-
cedure provided in the foregoing articles provided for the increase
or reduction of the nominal capital.
Unless specified otherwise, the remaining regulations con-
cerning the company limited by shares shall be applied to the
company limited by shares with variable nominal capital.
Art. 362
The articles of such a company must determine the maximum
sum which may be achieved in this manner by a gradual increase
of the company capital. The articles must also determine the
amount below which a gradual reduction, brought about by re-
payments to shareholders, may not take place.
The minimum amount must be at least one-tenth of the maxi-
mum capital, unless for important reasons this may be completely
disregarded with the approval of the Registrar in extrajudicial
proceedings.
3. Issue of bonus
shares by
drawin
g
J. Limited com-
panies with
variable in-
vested capital
I. In
general
II. Maximum and
minimum
nominal ca
pital

– 150 –
Art. 363
With the exception of the provision concerning capital repay-
ment, with reservation of the possibility of having to refund same,
and if the articles do not make provision for other restrictions, a
repayment to the shareholder from company capital may ensue in
each case only on the basis of a winding up balance sheet which
shows that after capital invested, which is allotted for repayment,
has been deducted, the business liabilities and the remainder of
the nominal capital, including the appropriate legal reserves in
accordance with the balance sheet, are fully covered by the avail-
able assets.
The articles shall determine the manner of establishing the part
of the capital allotted for repayment, whether by drawing, reso-
lution of the board of directors, etc.
In particular, the reduction of the par value of the not fully
paid up shares or the issuance of bonds to the shareholders to be
drawn, instead of being repaid, is put in the same category as re-
payment.
Shares acquired by the company by repayment may be kept in
safe custody for the purpose of reissue. However, they may not
be treated as membership rights.
Art. 364
If a reduction of the nominal capital causes the provisions of
the law or the articles to be violated, the members of the com-
pany’s bodies who are at fault, also the shareholder who received
benefit shall be liable without limitation, jointly and severally, for
the damages caused to the company, intentionally or by negli-
gence, pursuant to the regulations concerning responsibility.
If the company becomes bankrupt within a period of one year
after the share of a company was repaid or, instead of payment,
its nominal value was reduced, the shareholder and the redeemer
of the share shall be liable to the bankrupt’s estate for the amount
received or the remitted remainder on payment, without being
able to claim a right to settlement or items of the company’s
property.
III. Reduction
1. Preconditions
and
procedure
2. Liabilit
y

– 151 –
Art. 365
The regulations concerning the legal reserve fund shall be applied
with the deviation that each year a sum equal to at least one-tenth
of the net profit must be allocated to the reserve fund until it is
equivalent to the minimum capital and, if such capital is lacking,
to one-tenth of the maximum capital.
Art. 366
Insofar as the nominal capital is used up by gradual repayment
and bonus shares have not been issued, the articles must deter-
mine the legal form in which the undertaking shall continue to
exist, whether as an establishment, or a foundation or similar.
The conversion without liquidation of a company with vari-
able nominal capital into a limited company with fixed nominal
capital shall require an amendment of the articles, the necessary
change of company name and registration in the Public Register.
The conversion without liquidation of a limited company with
variable nominal capital into a cooperative society with shares and
without liability and obligation to make further contributions is
possible at any time on the basis of a company resolution with
amendment of the articles and registration in the Public Register.
Art. 367
Each year the company must submit to the Public Register its
annual balance sheet and, if a reduction of the capital ensued
during the financial year, its winding up balance and a statement
concerning the change in the capital invested which thereby took
place.
The names and addresses and/or the name of the company and
the domicile of the drawn shareholders must be listed in the
statement.
The documents submitted shall be filed in the Register files
and shall not be published.
IV. Mandatory
reserve fund
V. Conversion
VI. Registration
in the Public
Re
gister

– 152 –

– 153 –
Fifth Title
The Establishments and Foundations
First Section
The Establishments
Art. 534
An establishment within the intendment of this title and pur-
suant to the following regulations is a legally autonomous, or-
ganised, permanent undertaking dedicated to economic or other
objects and entered in the Public Register as the Establishment
Register, which has holdings of material and possibly personal
resources. It does not have the character of an institution under
public law and has no other form of legal entity.
Establishments under public law which serve a defined perma-
nent object and are in the hands of the public administration are
subject to public law, insofar as exceptions do not exist and,
where they are independent, to the following regulations supple-
mentally.
Ecclesiastical establishments are subject to public law and,
supplementally, canon law.
Establishments without legal personality (non-independent
establishments) and other non-independently donated assets for a
specific object are not subject to the following regulations, but to
the regulations concerning the implied
1) trust. Foundations are
reserved. … 2)
Art. 535
An establishment may be formed and operated by an indivi-
dual person, a firm, a community or by an association of com-
munes or a legal entity not otherwise entered in the Public
Register.

1) See annatation 3 Art. 898 2) Art. 534 last para. (= para. 5) inserted by the law dated the 10 April, 1928,
concerning the trust enterprise, LGBl. 1928, No. 6, repealed by the law dated 15
April, 1980, LGBl. 1980, No. 39.
A. Concept and
definition
B. Formation
I. Founder

– 154 –
Communes and associations of communes require Govern-
ment assent to the formation.
More than one founder is not required.
Art. 536
Written articles are necessary for the formation, signed by one
or several founders.
Moreover, the articles of an establishment must contain provi-
sions concerning the following:
1. The name and/or the name of the firm, the domicile and the
designation as “Establishment”,
2. the objects of the establishment,
3. the estimated value of the establishment capital in the event
that it is not in cash and the manner of procurement and com-
position,
4. the powers of the supreme body,
1)
5. the bodies for the administration and, if necessary, for the
auditing and the manner in which representation is imple-
mented,
6. the principles relating to the drawing up of the balance sheet
and the appropriation of the surplus,
7. the form in which the establishment’s notices ensue.
With the exception of Nos. 6 and 7
1 these provisions shall be
deemed to be essential pursuant to the regulations concerning
voidability.
Where the establishment capital exists in a form other than
cash, the endowed assets may, instead of in the articles, be entered
in detail in a special register which must be deposited with the
Register Office for safe keeping.
Like a company limited by shares, an Establishment may also
be formed with a variable capital. This circumstance must be
entered in the Public Register.

1) Art. 536 para. 2 No. 4 and para. 3 in the version of the law dated 15 April, 1980,
LGBl. 1980, No. 39
II. Articles

– 155 –
Art. 537
If the law does not provide otherwise, all establishments are
required to be entered in the Public Register.
A certified copy of the articles and documented proof of do-
nation of capital must be enclosed with the application to register,
which must contain:
1)
1. the formation deed (the resolution and/or declaration of for-
mation) in the event that it is not already included in the
articles,
2. the declaration that at least half the establishment capital has
been paid in or covered by payment in kind and stating how
the remainder is to be raised and/or secured,
3. a list of the members of the board of directors stating the
names of the members, their place of residence and/or the
name of the firm and domicile.
Art. 538
The following shall be entered in the Public Register and
published as an extract:
1. The formation deed, if this is not included in the articles,
2. the date of the articles,
3. the name and/or the name of the firm and the domicile of the
establishment,
4. the objects of the undertaking and, if applicable, the duration
of the establishment,
5. the amount of capital endowed to the establishment as well as
the sum paid in or the other assets contributed, with their es-
timated value,
6. if applicable, the participation rights of third parties in par-
ticular, in addition to the entitled beneficiaries,

1)Art. 537 para. 2 first sentence in the version of the law dated 15 April, 1980,
LGBl. 1980, No. 39.
III. Entry in the
Establishment
Register
1. Registration in
the Re
gister
2. Entry and
publication

– 156 –
7. the name, first name and place of residence and/or the name of
the firm and domicile of the members of the board of direc-
tors, the form in which the board of directors gives notice of
its expressions of intent and the manner of representation.
8. the form in which the establishment’s announcements shall
ensue.
The establishment comes into existence and acquires legal per-
sonality only upon entry in the Public Register. Should action be
taken on behalf of the establishment before the said establishment
has acquired or without it having legal personality, the parties
acting on behalf of the establishment, in particular founders or
persons already appointed as governing bodies shall be liable pur-
suant to the general regulations concerning legal entities.
1
Art. 539
The establishment capital (endowment fund) may be endowed
either completely or up to a partial amount to be determined in
the articles in funds contributed by the founders who, however,
shall have no claim to interest at a determined level.
The fund contributions must be paid in or contributed within
the period of time determined in the articles.
Where the founders bring items of property into the estab-
lishment which are to be credited to the fund contributions, the
articles or the register shall establish individually, in detail, accu-
rately and completely the object contributed, its expert valuation
and any beneficial interests which may be tied thereto.
Should the establishment capital be paid in full or covered by
means of assets at a later date when the establishment is in opera-
tion, this fact shall be registered in the Public Register.

1) Art. 538 para. 2 inserted by the law dated 15 April, 1980 LGBl. 1980, No. 39.
IV. Establishment
fund, liabilit y

– 157 –
Art. 540
1)
Establishment shares of the establishment assets for the found-
ers or third parties shall only exist pursuant to the provisions of
the articles, even though fund contributions have been effected
and entitled beneficiaries have been designated to draw profit
from the establishment.
Shares and share certificates of an establishment shall also be
null and void as long as the admissibility of shares or share certifi-
cates is not provided for in the articles and the issuer and third
party participants shall be liable pursuant to the provisions drawn
up under the general regulations.
In case of doubt, the shares provided for the founders in the
articles shall be in proportion to the amount of their possible fund
contributions and if funds have not been contributed the founders
shall receive equal shares.
Establishment shares shall be treated as securities only when
the articles make express provision for such treatment.
Establishment certificates as securities shall be subject to the
regulations concerning registered shares unless more restrictive
regulations concerning their transferability are drawn up in the
articles.
The board of directors shall keep a register of the establish-
ment shares with appropriate application of the regulations con-
cerning the share register in the case of a limited liability com-
pany.
Art. 541
2)
The founder’s rights to which one or several persons are entitled
may be relinquished or otherwise transferred or inherited but
may not be pledged or otherwise charged.

1) Art. 540 in the version of the law dated 15 April, 1980, LGBl. 1980, No. 39.2) Art. 541 and Art. 543 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
V. Establishment
shares
C. Founder’s
ri
ghts

– 158 –
Art. 542
The contestation of an establishment by the heirs or the
creditors of a founder shall ensue, if it was formed in favour of
third party beneficiaries without valuable consideration, as in the
case of a gift.
Art. 543
1)
The bearer(s) of founder’s rights form(s) the establishment’s
supreme body. The articles may also confer the powers of the
supreme body upon the board of directors.
Where the law or the articles do not determine to the contrary,
the supreme body shall be entitled to those powers which are
provided by the general provisions for the supreme body.
Where several persons have founder’s rights, resolutions shall
require the assent of all bearers of founder’s rights in order to be
valid if the articles do not determine otherwise.
A bearer of founder’s rights shall be at liberty to represent
personally the founder’s rights to which he is entitled or to in-
struct a third party, who is not required to be a bearer of foun-
der’s rights, by means of a written power of attorney to represent
the said founder’s rights.
Art. 544
The members of the board of directors may or may not be
entitled beneficiaries.
If the law or the articles do not determine otherwise, the judge
may, upon application of the participants, in extrajudicial pro-
ceedings, appoint the members of the board of directors in case of
doubt for a period of three years and remove them or individual
members at any time, without prejudice to claims for compensa-
tion.
In the absence of a deviating provision, the board of directors
shall be under obligation to the establishment also to observe all

1)Art. 541 and Art. 543 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
D. Contestation
E. Governing
bodies
I. Su
preme bod y
II. Establishment
administration
and audit
authorit
y

– 159 –
those restrictions which, upon application of the participants, are
determined by the judge in extrajudicial proceedings, relating to
the scope of their authority, the conduct of establishment busi-
ness and the representation of the establishment. However, a
restriction on representation towards bone fide third parties shall
have legal effect only insofar as the law permits this.
Where an audit authority is prescribed pursuant to the general
regulations or the articles make provision for this, the judge may,
in extrajudicial proceedings, in the absence of another provision
in the law or the articles, appoint or remove the audit authority,
in the same way as the members of the board of directors are
appointed or removed.
1)
Art. 545
The articles shall determine in detail:
1. Who shall benefit from the establishment and its possible net
profit (beneficiaries),
2. the manner in which these shall be determined specifically,
3. whether and in what way the beneficiaries shall be entitled to
participate in the organisation (supreme body, board of di-
rectors, supervision.
2)
As long as no third parties have been appointed as beneficiar-
ies (entitled beneficiaries), it shall be assumed that the bearer of
the founder’s rights is the beneficiary.
2)
Only an amount corresponding to the surplus of net assets in
excess of the establishment capital paid in pursuant to the articles
or otherwise covered may be withdrawn from the establishment
assets as available net profit, after allowance has been made for
possible reserves to be paid into the reserve fund provided for in
the articles.

1) Art. 544 para. 4 in the version of the law dated 15 April, 1980, LGBl. 1980 No. 39.2) Art. 545 para. 1 No. 3 reworded and para. 1 to inserted by the law dated 15 April,
1980, LGBl. 1980, No. 39.
F. Legal relation-
ship of the
founders and
the beneficiar-
ies to the es-
tablishment,
between them-
selves and to-
wards third
parties
I. In
general

– 160 –
Upon demand of the board of directors unknown beneficiaries
may be called in public citation proceedings on condition that
individual performances which have not been withdrawn shall
become forfeited in favour of the regional public assistance fund
three years after the call unless the articles determine otherwise.
Art. 546
In the case of family establishments, the founder may determine
in the articles that the establishment beneficial interest of the spe-
cifically designated third parties, acquired without valuable con-
sideration, may not be withdrawn from them by their creditors
by way of levy of execution and writ or by bankruptcy proceed-
ings initiated against them. This circumstance shall be annotated
in the Public Register at the time of registration.
Apart from the previously mentioned provision in the articles, the
income received without valuable consideration by a third party
beneficiary from an establishment formed by another may be
withdrawn from the said third party by creditors by way of levy
of execution and writ or bankruptcy proceedings only if the said
income is not required for the defrayal of the essential mainte-
nance of the beneficiary, the beneficiary’s spouse and children not
provided for.
Art. 547
Where the articles do not determine to the contrary, the book
value of the establishment assets shall be determined from the
difference between the valuation of the assets, undertaken annu-
ally, and the debts owed to third parties.
Under these circumstances, the annual balance sheet shall
show the amount by which the establishment assets have in-
creased or diminished by comparison with the previous business
year.
In this case, only the amount yielded during the course of the
year may be distributed as profit after the deduction of any re-
serves which may have to be formed.
II. Non-with-
drawabilit y
III. Determination
of assets and
profits

– 161 –
Art. 548
In all cases, only the establishment’s assets shall be liable for
the establishment’s debts.
Each founder shall only be required to meet the obligation to
transfer as specified the endowed assets including a limited liabil-
ity or liability to make further contributions as in the case of reg-
istered cooperative societies. The founder shall not be released
from these performances nor may respite be granted and this shall
apply in the event of the bankruptcy of the establishment.
Instead of or in the absence of members, third parties may also
assume the limited liability for the establishment’s obligations or a
limited liability to make further contributions.
Art. 549
The founder may at any time amend the articles and, in par-
ticular, the objects, with reservation of the creditors’ rights, e.g.,
by increasing or reducing the establishment capital, changing the
governing bodies and by making other similar amendments.
Instead of or in addition to the founder, the articles may em-
power other persons, legal entities, firms or authorities to amend
the articles and include detailed regulations concerning this.
Where the founder’s rights cannot be exercised and the articles
do not determine otherwise, they may be amended by the judge
in extrajudicial proceedings upon application by the board of
directors or one of the beneficiaries, taking into consideration the
objects of the establishment.
1)
Art. 550
To what extent the dissolution of a legal entity, a company or
a firm which is the founder or possessor of an establishment re-
sults in the dissolution of the said establishment shall be pro-
nounced by the judge in the individual case, after considering all
the circumstances.

1) Art. 549 para. 3 in the version of the law dated by the 15. April, 1980, LGBl. 1980,
No. 39.
IV. Liability of the
establishment,
limited liability
or liability to
make further
contributions
G. Amendment of
articles
H. Dissolution,
merger and
conversion

– 162 –
Insofar as the law concerning establishments or the articles do
not indicate a deviation, the relevant regulations concerning reg-
istered cooperative societies shall be applied accordingly to the
take-over of one establishment by another and the association of
several establishments.
The regulations concerning the conversion of a company lim-
ited by shares in the case of limited liability companies shall be
applied accordingly to the conversion to an establishment of a
company limited by shares or a company with limited liability.
Art. 551
If no mandatory regulations are drawn up in this section and no
rule or no satisfactory rule is contained herein, the regulations
concerning trust enterprises with legal personality shall be ap-
plied, in addition to the general regulations concerning legal enti-
ties.
1)
For establishments without members which serve exclusively
non-profit making objects, the supplementary regulations con-
cerning the supervision, conversion and cancellation of a founda-
tion shall apply, and for family establishments without members
the regulations for family foundations, provided that a deviation
is not foreseen in this section or in the articles.

1) Art. 551 para. 1 in the version of the law dated 15 April, 1980, LGBl. 1980 No. 39.
J. Reference

– 163 –
Second Section
The Foundations
Art. 552
For a foundation to be formed by natural persons or legal en-
tities or firms, it is necessary for assets to be endowed (foundation
property) for a certain specific purpose. Ecclesiastical, family and
non-profit making purposes may be given particular considera-
tion. Commercial activities may be undertaken by a foundation
only provided such activity serves its non-commercial purpose or
the type and scope of the participations held require the facilities
of a commercial business.
1)
Asset donations without legal personality (dependent founda-
tions) or donations tied to the condition of a special administra-
tion under a special name and of application for a special purpose
and similar conditions to already existing legal entities or natural
persons or companies are subject to special regulations such as
those applying to gifts or concerning the law of succession and,
supplementally, to the regulations concerning the implied
2) trust
relationship.
The judge shall decide in the individual case the extent to
which separately administered assets (fund) shall be entitled to
independence according to private law or to the character of trust
property.
The regulations concerning the trust enterprise with legal per-
sonality shall be applied to foundations accordingly, particularly
with regard to foundation participants (founder, foundation
council, beneficiaries), where and insofar as the following provi-
sions or the foundation articles or the regulations concerning the
obligation of trust enterprises to register do not determine to the
contrary.
3)

1) Art. 552 para. 1 in the version of the law dated 15 April 1980, LGBl. 1980, No. 392) See annatation 3 to Art. 898. 3) Art. 552 last para. (= para. 4) inserted by the law dated 10 April, 1928, concerning
the trust enterprise, LGBl. 1928, No. 6.
A. Definition and
delimitation
I. In
general

– 164 –
Art. 553
Ecclesiastical foundations within the intendment of this sec-
tion are foundations formed for ecclesiastical purposes.
A family foundation is a pure family foundation where the
foundation assets are continously connected with the purpose of
defraying the expenses for the upbringing and education, outfit-
ting or support of the relatives of one or several designated fami-
lies, or with similar purposes.
It is a mixed foundation where assets so donated serve ecclesi-
astical or other purposes outside the family in addition or sup-
plementally.
1)
Art. 554
2)
To ensure observance of the obligation to register, to prevent
foundations with unlawful or immoral purposes and to avoid
circumvention of possible supervision, the foundation deed
and/or a certified copy of the testamentary disposition or the
deed of inheritance must be deposited by the foundation council
or the legal representative and/or the probate court with the
Register Office at the time a foundation is formed, insofar as an
application for entry does not ensue otherwise. Amendments of
the articles must also be deposited with the Register Office.
Art. 555
The formation of a foundation ensues in the form of a deed on
which the signatures of the founders are certified, by testamentary
disposition or by deed of inheritance.
The foundation deed or the articles must contain the name and
domicile of the foundation, its purpose or object, the designation
of the foundation council members and the method for appoint-
ing another foundation council as well as a provision concerning
the application of the assets in the event of the dissolution of the
foundation.

1) Art. 553 para. 3 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
2) Art. 554, amended by the law dated 30 April, 1938, LGBl. 1938, No. 10, and the
8. June, 1938, LGBl. 1938, No. 12, in the version of the law dated 4 June, 1963,
LGBl. 1963 No. 17.
II. Ecclesiastical
and family
foundations
III. De
position
B. Formation
I. Foundation
deed

– 165 –
Art. 556
The foundation’s application to register in the Foundation
Register must be recorded by all the members of the foundation
council personally or submitted in writing in certified form. The
application must be accompanied by a certified copy of the foun-
dation deed.
The entry and publication, which may ensue by announce-
ment on the court notice board, must contain: the name, (name of
the firm), address and purpose of the foundation, the date of the
formation deed, the names and addresses and/or the name and
domicile of the firm of the foundation council members and/or of
other representatives.
If necessary, entry and publication may also be undertaken by
order of the Government as supervising authority by virtue of of
the foundation deed, possibly by the Register Authority ex officio
upon notification by the Probate Authority or upon petition of
the Beneficiaries.
Art. 557
The foundation only comes into existence when entered in the
Public Register as Foundation Register.
Ecclesiastical foundations, pure and mixed family foundations
and foundations whose entitled beneficiaries are specifically des-
ignated or definable acquire legal personality without being en-
tered in the Public Register.
1)
Foundations which engage in commercial activities are under
the obligation to register and acquire legal personality only when
entered in the Public Register.
1)
The registration of a foundation formed by testamentary dis-
position shall ensue only after the death of the founder and, in the
case of a deed of inheritance, provided that this does not deter-
mine otherwise, only after the death of one of the founders.

1) Art. 557 para. 2 and 3 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
II. Entry in the
Foundation
Re
gister
III. Existence

– 166 –
Art. 558
When the foundation has come into existence, the founder or
the third party, upon demand of the Supervising Authority, the
representative of public law or of interested parties, is required to
transfer to the foundation the assets mentioned in the deed of
foundation.
Rights, for whose transfer a declaration of assignment is suffi-
cient, devolve by operation of the law upon the foundation on
coming into existence.
Where the foundation only becomes effective on the death of
the founder or after the termination of a firm or legal entity, the
said foundation shall be deemed to have been in existence already
before the death or termination of the founder for the donations
of the founder or third party.
The donation of assets may also be effected, in particular, by
the establishment of a contractual relationship to the founder or
third party according to which the founder or third party under-
takes to donate annually or at certain intervals a fixed or variable
sum or other assets (donation of periodical payments).
In case of doubt, the investment of assets shall ensue pursuant
to the regulations concerning trust investments.
Art. 559
Revocation of the foundation is admissible only:
1. If a foundation has not yet been entered in the Public Register,
inasmuch as existence ensues only in the event of such entry,
2. in the event that registration of the foundation is not necessary
and the foundation should become effective in law during the
founder’s lifetime, up to the time of conclusion of official cer-
tification,
3. in the case of foundations formed by testamentary disposition
or deed of inheritance, pursuant to the regulations of the laws
of succession applicable to these circumstances.
IV. Donation of
assets
V. Revocation

– 167 –
In the case of testamentary dispositions, the founder person-
ally has an unrestricted right of revocation but not, on the other
hand, the heirs after the founder’s death, not even if the founda-
tion is not yet entered in the Public Register.
Likewise, the heirs do not have a right of revocation where in
the case of the foundation inter vivos the founder certainly drew
up the deed but died before the foundation was entered in the
Public Register.
Revocation expressly reserved in the foundation deed or the
reserved amendment of the deed or of the articles is admissible at
any time.
Art. 560
The validity of a foundation may be disputed by the heirs or
the creditors in the same way as a gift.
Also after it has been registered, the founder and his heirs may
dispute the validity of the foundation on grounds of deficiency of
intention in the manner admissible pursuant to the provisions of
contract law.
Art. 561
The foundation’s governing bodies, such as the foundation
council, the audit authority and similar bodies, as well as the type
of administration and representation, etc., are determined in the
deed of foundation or in the foundation articles drawn up by the
founder in a document, a will or a deed of inheritance.
The conferment of beneficial interest in the foundation may be
entrusted to a special body (collators), independently of the foun-
dation council.
The regulations concerning the governing bodies in question
in the case of establishments shall be applied accordingly to the
powers and duties of the bodies appointed in this manner, with
reservation of the following provisions.
VI. Contestation
C. Governing
bodies
I. In
general

– 168 –
Art. 562
Where no governing bodies have been provided for or where
those provided are inadequate, the Supervising Authority shall
take the necessary steps with appropriate observance of the regu-
lations concerning the establishment’s governing bodies. If re-
quired, the Supervising Authority shall arrange for entry in the
Public Register.
In the event that such steps cannot be taken expediently if, for
instance, there are inadequate assets, the Supervising Authority,
provided the founder does not object or a provision of the foun-
dation deed or the foundation articles is not expressly opposed to
this, shall donate the assets on trust to another foundation having
as far as possible the same kind of purpose.
Art. 563
Only the foundation’s assets shall be liable for the founda-
tion’s debts to the creditors.
Except for the extensive provisions in the case of family foun-
dations, income which a person receives from a foundation with-
out valuable consideration may be withdrawn by injunction, levy
of execution and writ or bankruptcy proceedings only when the
said income is not required for the defrayal of the essential living
expenses of the beneficiary, his spouse and his children without
means.
In the case of foundations subject to supervision, unknown
beneficiaries of the foundation may be traced by the Government
or, otherwise, upon application by the judge in public citation
proceedings.
Art. 564
With the exception of ecclesiastical foundations, pure and
mixed family foundations or such foundations as those whose
entitled beneficiaries are specifically designated or definable natu-
ral or juridical persons, firms or their successors in title or those
foundations whose purpose is solely to administer the assets and
II. Order of the
Supervising
Authorit
y
D. Liability and
exclusion of
enforcement,
etc.
E. Supervision
I. In
general

– 169 –
distribute the income, participation or similar, the foundations are
subject to supervision by the Government, which shall be notified
by the Register Authority of every foundation under obligation
to register.
1)
The foundation deed may also subject other foundations to
Government supervision.
It shall be incumbent upon the Supervising Authority to en-
sure that the foundation assets are administered and applied pur-
suant to their purposes. This Supervising Authority may give the
necessary orders concerning, for example, auditing and the re-
moval of the foundations’ governing bodies.
Any person who has an interest in the administration and ap-
plication of the assets, their yield or use and the representative of
public law may lodge a complaint with the Supervisory Authority
concerning an administration and application of the assets by the
foundations’s bodies which is in conflict with the purpose of the
foundation.
The participants shall be heard before a decision is pronounced
by the Supervising Authority or the Administrative Court of
Justice.
Art. 565
After hearing the foundation’s supreme authority and those
persons whose rights are affected, the Government, upon appli-
cation of one of the participants or ex officio, may change the
foundation’s organisation by administrative action if this is re-
quired urgently in order to preserve the assets or safeguard the
foundation’s purpose and insofar as the foundation deed or the
articles has (have) not entrusted another body or a third party
with the changing of the organisation.
The Landesbank in particular may be designated as a founda-
tion governing body by the Supervising Authority.
In opposition to such amendment orders, the participants may
lodge an appeal with the Administrative court.

1) Art. 564 para. 1 in the version of the law dated 15 April, 1980, LGBl. 1980, No. 39.II. Amendment
1. Concerning
governing
bodies

– 170 –
Art. 566
After hearing the foundation’s supreme authority and those
persons whose rights are affected, the Government, upon appli-
cation by participants or ex officio, may amend the foundation
deed by administrative action if its original purpose has acquired a
completely different meaning or effect and as a result of this the
foundation is obviously estranged from the intentions of the
founder.
The foundation deed or the articles may also provide for a
foundation governing body or a third party to be empowered to
effect amendment of the purpose if it is incapable of achievement,
inadmissible or unreasonable.
Charges and conditions which impair the foundation’s pur-
pose may be cancelled or amended under the same preconditions.
The last paragraph of the preceding article shall be applied
accordingly.
Art. 567
Permanent or temporary judicial supervision with respect to
the regulation of the governing bodies and the purpose of foun-
dations not subject to supervision, insofar as ecclesiastical foun-
dations are not concerned, and their conversion may, upon appli-
cation of participants, be pronounced by the judge in extrajudicial
proceedings and, if adequate reasons exist, be cancelled again. In
this case, the judge, like the Government as Supervising Author-
ity, may give the necessary instructions.
If provision has not been made for the absolute discretion of
the foundation’s governing bodies, the judge shall in all cases
decide in contentious proceedings concerning other difficulties of
a private law nature such as, for example, the question of benefi-
cial interest (entitlement or privelege), its scope, and so forth.
In the case of family foundations, the founder may determine at
the same time that the creditors of the specifically designated third-
party beneficiaries shall not withdraw from these their beneficial
interest acquired without valuable consideration by way of injunc-
tion, levy of execution and writ or bankruptcy proceedings.
Trust certificates may also be issued to the entitled beneficiaries.
2. Concerning the purpose
F. Family foun-
dations, eccle-
siastical foun-
dations and
similar

– 171 –
Art. 568
i)
The cancellation of a foundation ensues by operation of the
law as soon as the purpose cannot be achieved, particularly when
the foundation purpose can no longer be realised when, owing to
lack of adequate assets, the duties of the foundation can no longer
be fulfilled or the duration specified in the foundation deed has
expired.
Art. 569
The Supervising Authority, the representative of public law
and any interested party is entitled to take action
The cancellation shall be reported to the Registrar ex officio in
order that deregistration may ensue.
The action may be annotated in the Public Register before or
during the proceedings, up to the time of final decision, upon
application or ex officio. The governing bodies of the foundation
and other participants shall be heard before the decision is made.
Art. 570
1)
Where conversion is expressly provided for and also the neces-
sary prerequisites, such as articles or governing bodies are pro-
vided, the foundation, without being wound up, may be con-
verted by the foundation council or a third party empowered by
the foundation council into an establishment or a trust enterprise
by means of a document which must be correct with respect to
form.

i) Art. 568 and 570 in the version of the law dated the 15. April, 1980 LGBl. 1980,
No. 39.
G. Cancellation
I. By operation of
law
II. Right of action
and deregistra-
tion
III. Conversion

– 172 –

– 173 –
Fifteenth Title
The Individually Owned Enterprise
with Limited Liability
Art. 834 to 896a 1)
Sixteenth Title
The Trusts
First Section 2
The Trusts in General
Art. 897 3)
A trustee within the intendment of this law is a natural person,
firm or legal entity to whom another (the settlor) transfers mov-
able or immovable property or a right (as trust property) of what-
ever kind with the obligation to administer or use such property
in his own name as an independent legal owner for the benefit of
one or several third persons (beneficiaries) with effect towards all
other persons.
Art. 898
3)
Wherever by operation of law or disposition of an official
authority or in any other way, a person, without being specifi-
cally appointed as trustee, receives property or rights of any kind
in his own name, but for the benefit of the owner hitherto or a
third party, the relationship existing between such person and the

1) Art. 834 to 896a, amended by the law dated 10 April, 1928, LGBl. 1928, No. 6,
repealed by the law dated 15 April, 1980, LGBl. 1980, No. 39.
2) Title inserted by the law dated the 10. April, 1928, concerning the trust enterprise,
LGBl. 1928, No. 6.
3) Art. 897 and 898 in the version of the law dated 15 April, 1980, LGBl. 1980, No.
39. By the law mentioned, the “implied trust” in Art. 898 was deleted without
being replaced.
A. Definition
I. The trust
relationshi
p
II. The implied
trust

– 174 –
third party shall, in the absence of any other provision, be treated
as an implied trust.
If the law does not make special provision for such legal rela-
tionships or nothing otherwise results from the special circum-
stances, the regulations relating to the trust relationship concern-
ing, in particular, the status of the trust property in the case of
levy of execution and writ and bankruptcy proceedings shall be
applied analogously to the legal relationship between the holder
of assets or rights and the third party.
Art. 899
1)
A trust is created by a written agreement between the settlor
and the trustee. A statement of consideration is not required.
A written declaration of acceptance by the trustee is required
for the creation of a trust where the appointment of a trustee
ensues by virtue of a unilateral declaration by the settlor.
A trust must in all cases by expressly denominated as such, in
a manner which is readily distinguished by the trustee.
The provisions relating to the formalities of transfer of tangi-
ble articles of property and other assets are reserved.
Art. 900
1)
Within twelve months of its creation, every trust created for a
period of longer than twelve months must, with reservation of the
following provisions, be recorded in the Public Register where
the trustee or at least one of several co-trustees is resident or
domiciled in the Principality of Liechtenstein.
The application for registration in the Public Register must
contain:
(a) The name of the trust,
(b) the date of formation of the trust,
(c) the duration of the trust,
(d) the surname, first name and place of residence or firm and
domicile of the trustee.
Every amendment of a registered fact must also be registered.

1) Art. 899 and 900 in the version of the law dated 15 April, 1980 LGBl. 1980,
No. 39.
B. Creation and
termination of
the trust
I. Creation
1. Trust instru-
ment
2. Registration in
public registers
a. In
general

– 175 –
Art. 901
1)
Where property of a trust is registered in other public regis-
ters, such as the Land Register, the Patent Register or similar and
the trust itself is entered in these public registers, the Registrar
may agree to waive an additional entry of the trust in the Public
Register.
Art. 902
1)
An obligation to register a trust in the Public Register does not
exist when the original or a certified copy of the formation deed is
deposited with the Public Register within the time limit of twelve
months. In such case, an original or certified copy of every docu-
ment amending the formation deed must also be deposited with
the Public Register Office.
Art. 903
Where a trustee has not been appointed by an agreement inter
vivos, but by a unilateral trust instrument or testamentary dispo-
sition, the trustee must be informed of the appointment by the
Public Registrar or the probate authority upon application of
interested parties or ex officio if the settlor has not informed the
trustee of his appointment and the latter has accepted.
The nominated trustee must notify the Registrar or the pro-
bate authority of his acceptance of the trusteeship within the time
limit of fourteen days from the date of receipt of notification,
which period may be extended as appropriate, otherwise it shall
be presumed that he has refused the appointment.
A refusal must also be presumed if, contrary to the trust in-
strument, the acceptance is qualified, limited, subject to a condi-
tion or otherwise restricted.
In addition, the regulations concerning entry in the Public
Register shall apply where relevant.

1) Art. 901 and 902 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39
b. Exce ptions
c. De
position
3. Notification of
a
ppointment

– 176 –
Art. 904
In addition to the cases provided by law, the Princely Liech-
tenstein Court of Justice must appoint a judicial trustee in extra-
judicial proceedings if a trust as, for example, a foundation with-
out legal personality, has been created by a unilateral formation
deed inter vivos or a disposition mortis causa, but a trustee has
not been appointed by name or in any other recognisable manner
or if the trustee appointed refuses to accept office or if a trustee
nominated in any other way ceases to act for any reason and the
trust instrument does not determine the manner in which another
trustee should be appointed or how the trust property is to be
otherwise dealt with.
The Public Register or the probate authority or other judicial
and administrative authorities must inform the Princely Liechten-
stein Court of Justice of such reasons for appointment.
After consultation with the interested parties, the Princely
Liechtenstein Court of Justice shall, where appropriate, appoint a
judicial trustee, paying due attention in the first place to the pos-
sible wishes of the settlor and, in the absence of such wishes, to
the interests of the trust property.
Normally, the Liechtensteinische Landesbank should be ap-
pointed as judicial trustee and, if the Landesbank refuses to accept
the appointment and important reasons do not justify an excep-
tion, only Liechtenstein citizens should be appointed, to whom
the personal prerequisites relating to an appointment as legal rep-
resentatives of legal entities shall apply.
The Liechtensteinische Landesbank shall be considered as
public trustee and in this capacity shall fulfil those duties imposed
upon it by the law, the authority or a trust instrument.
Art. 905
1)
If persons residing abroad are appointed as trustees of a trust,
at least one person resident in the Principality of Liechtenstein or
a domestic legal entity must be appointed as co-trustee.

1) Art. 905 in the version of the law dated 15. April 1980, LGBl. 1980, No. 39.
4. Judicial and
public trustee
and legal repre-
sentative
a. Judicial and
public trustee
b. Domestic
trustees

– 177 –
Art. 906
The trust shall terminate pursuant to the provisions of the
trust instrument and, in addition, if the trust property is ex-
hausted and not replaced.
A trust may be dissolved by the Princely Liechtenstein Court
of Justice in extrajudicial proceedings, under the conditions ap-
plying to the cancellation of a foundation by the Court.
In the case of termination of a trust, where the trust instru-
ment does not determine otherwise, the trustee or his successor in
title must render account and provide information concerning the
trust property in the same manner as during the existence of the
trust.
If nothing to the contrary is contained in the trust instrument
or the foregoing regulations, the trust property must be trans-
ferred to the settlor or his successor in title and, in the absence of
such persons, to the entitled beneficiary and, in the absence of an
entitled beneficiary, to a foundation whose purpose is as similar as
possible to that of the trust.
The trustee or his successors in title are under obligation to
effect the dispositions and administrative actions necessary for the
transfer.
Should the termination of the trust endanger the interests of
the trust property, the trustee, his heir, legal representative or
other universal successor in title (in the case of firms or legal enti-
ties) shall be under obligation to continue the administration of
the trust until the settlor, his heir or representative or, upon appli-
cation, the Princely Liechtenstein Court of Justice has given the
necessary instructions.
Art. 907
Rescission of the trust agreement by the settlor or revocation
of a trust is admissible only if the agreement or the unilateral trust
instrument expressly reserves such right of rescission or if revo-
cation is permitted pursuant to the regulations concerning foun-
dations created by testamentary disposition or contract of inheri-
tance.
II. Termination
1. In general
2. Grounds for
termination
relating to the
settlor

– 178 –
In all other cases, the trust shall be irrevocable, with reserva-
tion of the settlor’s or a third party’s right of avoidance pursuant
to the regulations concerning contractual defects, the regulations
concerning the law of inheritance or the law concerning acts void-
able at the instance of creditors and, if the case arises, the law
concerning donations.
In the case of trusts created by testamentary disposition or by
the articles of a legal entity, rescission or revocation is also subject
to the special provisions of the legal relationship.
Provided the trust instrument or the circumstances do not de-
termine otherwise, the death of the settlor or, in the case of com-
panies, firms, legal entities and similar, their termination, as well
as inability to act and bankruptcy shall not effect the cancellation
of the trust.
Art. 908
In the absence of a provision in the the trust instrument, a
trustee who has once accepted office shall be under obligation to
hold office for a period of at least one administrative year, insofar
as he remains capable of acting during such period.
Provided the trust instrument does not determine otherwise,
the trustee shall be entitled to give notice of termination for the
end of a calendar year, with a period of three months’ advance
notice, if important reasons do not justify a shorter term of no-
tice.
In the absence of other provisions in the trust instrument or if
a settlor a co-trustee or an entitled beneficiary is no longer pres-
ent, notice of resignation shall be given to the Public Registrar.
The trustee designated in the trust instrument to succeed shall
be notified by the Public Registrar, but where a successor trustee
has not been designated or an appointed trustee refuses or is un-
able to accept the office, the Registrar shall advise the Princely
Liechtenstein Court of Justice which, as in all other cases where
trust property is left without a trustee, shall appoint a trustee.
3. Termination
relating to the
trustee
a. Notice by the
trustee

– 179 –
Art. 909
If the trust instrument does not make provision for the sub-
stitution of the initially designated trustee in the event of death or
on grounds of inability to act, each heir of a trustee and, in the
event of inability to act, his representative is under obligation to
notify the Princely Liechtenstein Court of Justice.
Where the trustee is a partnership, a firm or a legal entity, the
partners, or shareholders, the representatives or successors of the
firm, or the governing bodies of the legal entity, or the trusteeship
in bankruptcy must give notice of termination to the Princely
Liechtenstein Court of Justice.
In addition, every beneficiary shall be entitled to give such
notification to the Princely Liechtenstein Court of Justice for the
purpose of appointing another trustee.
The procedure for appointment is the same as in the case of
resignation.
In the absence of any other provision in the trust instrument,
the trustee shall not retire from the trusteeship in the event of his
bankruptcy where the trust property does not appear to be en-
dangered and the judge does not order his removal. However, the
judge, upon petition of the participants or the trusteeship in bank-
ruptcy, may appoint a co-trustee.
Art. 910
The terms of the trust instrument, such as those of the trust
agreement, the disposition mortis causa or the articles shall be
authoritative in the first place for the interpretation of the trust
relationship between settlor, trustee and beneficiaries.
Where the terms of such a document are in conflict with man-
datory regulations or the public order of the country, they shall
be interpreted so as to be in accord therewith, insofar as the law
or the document does not determine otherwise.
Where the terms and the effect of the trust relationship be-
tween the participants and third parties cannot be determined
from the trust instrument, the regulations of this chapter shall

1) Marginal note to Art. 910 in the version of the law dated 15 April, 1980, LGBl.
1980, No. 39.
b. Death or
termination,
inability to act
and bankruptcy
of the trustee
C. Terms and
effect of the
trust relation-
ship
1. In
general 1

– 180 –
apply and in this regard the rights entered in the Land Register
shall be effective against all persons, while with respect to other
rights the trustee shall have the status of a beneficial owner (ad-
ministrative right in rem).
The regulations concerning the amendment (conversion) of a
foundation shall be applied analogously to the amendment (con-
version) of a trust by the Princely Liechtenstein Court of Justice
in extrajudicial proceedings.
Where nothing otherwise results from the pursuit of commer-
cial objects or entry in the Trust Register, the regulations con-
cerning the trust enterprise shall be applied supplementally.
1)
The interpretation and application of all regulations concern-
ing the trust enterprise and all other trust provisions shall ensue
pursuant to the principles of equity.
2)
Art. 911
All assets so designated by the settlor or by operation of the
law shall be trust property, as well as all assets acquired by the
administration of such property, whether it has been included in a
schedule or an inventory or not .
Property that has been included in a schedule or an inventory
shall be presumed to be part of the trust property.
The trust property shall also include property acquired on
grounds of a right accruing to the trust property as a substitute
for an object of the trust property which has been destroyed,
damaged or removed, or acquired in any other way, by the means
of the trust property or as the result of a transaction related to the
trust property.
In the absence of provisions in the law or the trust instrument
to the contrary, the regulations concerning joint ownership
(Gesamteigentum), with the exception of those relating to the
dissolution of joint ownership, shall apply to trust property as
separate property on the understanding that the trustees have
joint rights and duties and that in the case of retirement of a trus-

1) Art. 910 para. 5 and 6 inserted by the law dated 10 April, 1928, concerning the
trust enterprise, LGBl. 1928, No. 6.
2) Art. 910 para. 5 and 6 inserted by the law dated 10 April, 1928, concerning the
trust enterprise, LGBl. 1928, No. 6.
II. The trust
property
1. In
general

– 181 –
tee or the appointment of a new trustee the rights and duties shall
devolve automatically upon the new trustee, except for the duty
to appoint new trustees, insofar as the transfer is not subject to
special formalities.
1
Art. 912
Where real estate or rights registered in the Land Register are
part of the trust property, they must, in the absence of other pro-
visions in the trust instrument, be transferred to the name of the
trustee in order to be effective towards third parties, whether with
or without restraint on disposal. This may be noted or annotated
in the Land Register.
Where an undertaking is registered in the Public Register un-
der a firm name or where an asset forming part of the trust prop-
erty is registered in another register, such as the Patent Register or
similar, then, in the absence of a provision to the contrary in the
trust instrument, the said undertaking or asset shall be specifically
described as trust property in the Public Register upon applica-
tion by participants.
Where third parties have acquired from the trustee property or
rights which they knew were trust property and the trustee was
not entitled to dispose of such property or rights, the settlor, a co-
trustee or a beneficiary or, finally, a trustee appointed by the
Princely Liechtenstein Court of Justice may, alone or as joint
litigant with others, claim the surrender of such assets or take
action on grounds of unjust enrichment for the benefit of the trust
assets.
A debtor shall acknowledge that a claim forms part of the trust
property only after receiving notification to this effect
Where claims are assigned by the settlor or a third party acting
on his behalf to the trustee, the debtor, in the absence of provi-
sions to the contrary in the trust instrument, cannot raise any
objections he is entitled to raise against the trustee, but all the
objections he is or was entitled to raise against the settlor.
2)

1) Art. 911 para. 4 inserted by the law dated 10 April, 1928, concerning the trust
enterprise, LGBl. 1928. No. 6.
2) Art. 912 para. 5 and Art. 913 para. 2 in the version of the law dated 15 April, 1980,
LGBl. 1980, No. 39.
2. Specific trust property

– 182 –
Art. 913
Unless the trust instrument determines to the contrary, the
trustee, if he is required to invest trust assets, shall deposit them
with the Liechtensteinische Landesbank and/or invest them in
securities issued by this bank or in bonds or in unbonded claims
for which Liechtenstein municipalities guarantee the payment of
interest or in loans to Liechtenstein municipalities or in mortgages
within the limits prescribed for mortgages.
The investment of trust assets in the acquisition of real estate
or the establishment of homesteads or participation in undertak-
ings is permitted only provided the trust instrument makes provi-
sion for or allows this or if the judge gives permission in extraju-
dicial proceedings and if at the same time the regulations
concerning mortmain are not circumvented.
1)
By way of an exception, also in other cases where there are
important reasons and provided the trust instrument does not
determine to the contrary, the trust property, or individual parts
thereof may, with the assent of the Princely Liechtenstein Court
of Justice in extrajudicial proceedings, also be invested in other
securities or in another manner.
These restrictions shall not apply to trusts which have prop-
erty belonging to persons or legal entities or firms domiciled
abroad (domiciliary trusts)
Art. 914
The creditors of the settlor or his successors in title may only
lodge a claim against the trust property pursuant to the provisions
of the law concerning acts voidable at the instance of creditors, or
otherwise, depending on the type of donation, pursuant to the
law concerning donations or succession.
The creditors of the beneficiary may lodge a claim against the
trust property by way of levy of execution and writ or bank-
ruptcy proceedings only insofar as the beneficiary himself has
claims against the trust property and a provision concerning the

1) Art. 912 para. 5 and Art. 913 para. 2 in the version of the law dated 15 April, 1980,
LGBl. 1980, No. 39
3. Authorised
trust invest-
ments
4. Execution and
bankruptcy
a. Creditors of
the settlor and
beneficiaries

– 183 –
prohibition of such withdrawal, as in the case of family founda-
tions, does not exist.
If at the same time the beneficiary is also a trustee, the fore-
going regulations shall apply analogously.
Art. 915
In injunction proceedings or in the case of levy of execution
and writ against or bankruptcy of the trustee, the trust property
shall be regarded as separate property and the trustee’s creditors
shall therefore have no right of claim against the trust property
where the trustee’s remuneration and claims for compensation are
not involved.
Where the trust property is comprised of real estate, movables
or other separable assets, it shall be separated as far as the circum-
stances permit and passed to the successor trustee, appointed in
the normal manner or judicially. The Princely Liechtenstein
Court of Justice shall issue the necessary orders concerning such
transfers, e.g., entries in Public Register ex officio.
Where the trust property is mixed with the debtor’s assets to
such an extent that an immediate official separation is not possi-
ble, the separation shall be undertaken by the Princely Liechten-
stein Court of Justice as soon as possible.
Where separation is not possible during the course of levy of
execution and writ and bankruptcy proceedings, a claim for res-
titution of the trust property shall take precedence over all other
creditors and if there is more than one settlor and/or entitled
beneficiary, they shall rank equally among themselves.
Where the trust instrument does not determine to the contrary
the settlor or his successor in title, the co-trustee or beneficiary
may claim individually or as joint litigants against the trustee or
the bankrupt’s estate for separation or compensation and they
shall be entitled to examine all the bankrupt’s books and records.
Within a period of time determined by the Court, the credi-
tors of the trustee may, for their part, contest by recourse to the
law the claims for separation and compensation insofar as these
are unjustified, in whole or in part; in particular, they may assert
b. Creditors of
the trustee

– 184 –
that a mixed trust exists and for this reason their debtor may have
a partial claim against the trust property for money, but not for
other assets.
Art. 916
The trustee is personally liable without limitation, jointly and
severally with possible co-trustees, for the debts incurred by him
on behalf of the trust insofar as they cannot be met out of the
trust property. However, unless the trust instrument determines
otherwise, the trustee shall have a right of recourse against the
settlor and, where there are grounds for avoidance or the prereq-
uisites exist for a case for unjust enrichment, against the benefici-
ary. A liability on the part of the trustee and a right of recourse
only exists, however, if it cannot be proved that the third party
was not acting in the belief that a liability went beyond the
amount of the trust property.
1)… 2)
Where a trustee participates in a firm or legal entity, the trus-
tee’s creditors may have a claim against him only to the extent
permitted by the regulations relating to the undertaking con-
cerned.
3)
The trust property may be subject to separate bankruptcy pro-
ceedings pursuant to the regulations of the law on bankruptcy, in
which case the creditors of the trust property may, if they are not
fully satisfied, claim compensation for loss from the trustee inso-
far as such claims are not excluded pursuant to the foregoing
paragraphs.
Art. 917
The settlor may transfer any parts of his assets on trust to a
trustee appointed by him by means of a trust agreement, unilat-
eral trust instrument, testament or articles and subject to the

1) Art. 916 para. 1 and 3 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
2) Art. 916 para. 2 repealed by the law dated 15 April, 1980, LGBl. 1980, No. 39.3) Art. 916 para. 1 and 3 in the version of the law dated 15 April, 1980, LGBl. 1980,
No. 39.
c. Creditors of
the trust prop-
ert
y
III. Rights and
duties of the
settlor
1. Ri
ghts

– 185 –
mandatory provisions of the law he may define the precise terms
of the trust. In particular, he may make provision for the trust
property, under certain conditions or after a certain period of
time, to revert to him or his successors in title or to devolve upon
third parties such as foundations or establishments.
He may draw up the conditions in the instrument according to
which a trustee appointed by him may be removed and possible
future trustees may be appointed.
Furthermore, he may specify conditions according to which a
beneficiary named in the trust instrument shall be excluded and
another nominated in his place and may state the conditions on
which trust property shall pass to other beneficiaries in the event
of death or exclusion of beneficiaries or similar.
Where the disposition provides for an estate in fee-tail (fidei-
commissum), it may not contravene the mandatory provisions
relating thereto.
Art. 918
The settlor may not draw up conditions which bind the trustee
to continous instructions of the settlor.
Where such provisions are drawn up, the relationship shall be
deemed to be a normal mandate within the intendment of the
Code of Obligations, unless the circumstances indicate a different
relationship such as, in particular, an agreement for service.
When the trustee executes the trust agreement or upon his ac-
ceptance of the trusteeship on the basis of a different trust instru-
ment, the settlor shall be bound by the relevant provisions.
The trustee, however, shall not be liable to the settlor for acts
undertaken pursuant to the settlor’s instructions but in violation
of the provisions of the trust.
In the case of proceedings concerning trust property, the
settlor may only be heard as a party and not as a witness and the
objection of res judicata shall apply both for and against the
settlor and his successors in title.
1)

1) Art. 918 para. 5 in the version of the law dated 15 April, 1980, LGBl. 1980, No. 39.
2. Duties and
other functions

– 186 –
Art. 919
After the agreement has been concluded, the trustee may re-
quire the settlor to comply with the said agreement, unless the
trust instrument determines otherwise.
Unless the trust instrument or the special circumstances de-
termine otherwise, the trustee may, after having accepted the
trusteeship, demand that the settlor or other legally bound third
parties, such as heirs or similar, comply with the terms of the trust
agreement.
Subject to his obligations pursuant to the provisions of the
trust instrument, the trustee shall be entitled to dispose of the
trust property in the same manner as an independent holder of
rights and duties as, for instance, an owner, a creditor, a member
or governing body of a legal entity or partnership or similar entity
and he may represent the trust before the authorities in his own
name as a party to an action in any capacity including that of an
intervener participant, co-summoned person. The trustee may
also administer and exercise the pertinent rights against all third
parties pursuant to the trust instrument and, insofar as this is
necessary, convert the trust property into cash and reinvest same
unless the purpose of the trust determines otherwise.
Provided the trust instrument does not determine otherwise,
the trustee shall be empowered to advance to a beneficiary an
appropriate part of the property which will subsequently devolve
upon him.
Insofar as obligations under the trust do not require fulfilment
by the trustee personally, the trustee may delegate all acts of ad-
ministration to third parties.
If the trustee is in doubt concerning the admissibility or ap-
propriateness of an act of administration or a disposition of the
trust property or unusual acts which create obligations at the
expense of the trust or if, in the case of co-trustees, one of these
refuses to cooperate, he shall, if necessary, appeal for binding
information to the Princely Liechtenstein Court of Justice in ex-
trajudicial proceedings and the Court may call in suitable persons
to assist in the legal findings.
Pursuant to the regulations concerning the administration of
companies with legal personality, the trustee has a right to request
IV. Rights and
duties of the
trustee
1. Rights
a. In
general

– 187 –
discharge relating to his activity pursuant to the last two para-
graphs of the following Article.
Art. 920
The trustee is entitled to claim reimbursement for all necessary
expenses and costs incurred by him in the interest of the trust.
The trustee is also entitled to be indemnified against damage re-
sulting from the trust property, to be released from obligations
entered into on behalf of the trust or otherwise incurred and,
furthermore, to appropriate remuneration for his services, insofar
as the trust instrument or another legal relationship does not de-
termine otherwise.
The trustee may claim interest at the rate which is usual in the
country on expenses or costs, calculated from the day on which
such expenses or costs were incurred.
In the absence of any provision to the contrary contained in
the trust instrument or any conclusions to the contrary which
could be drawn from the legal relationship between the trustee
and the settlor, any claim shall be made in the first place against
the settlor and then against the beneficiary entitled to the trust
property or the income therefrom.
Alternatively, the claims may be made against the trust prop-
erty direct, against the designation pursuant to the trust deed, or
against the persons liable as mentioned in the previous para-
graph.
1)
Art. 921
Without prejudice to his right to bring a claim in contentious
proceedings, the trustee may petition the Princely Liechtenstein
Court of Justice to determine the remuneration for his services in
extrajudicial proceedings after hearing the participating parties.
He may be reimbursed from the trust property in preference
to the beneficiaries and for this he may set off the claims he may
have against the settlor or beneficiary and may assert a lien on the
assets of the trust property.

1) Art. 920 para. 4 in the version of the law dated 15 April, 1980, LGBl. 1980, No. 39.
b. Indemnifica-
tion, trustee
fees, etc.
aa. Claims
bb. Enforcement

– 188 –
Art. 922
The trustee shall be under obligation to comply with the pro-
visions of the trust instrument and the regulations of this law
which are not in contradiction with the said provisions of the
trust instrument, to preserve and administer the trust property
with the care of a prudent business man and where customary or
appropriate he shall insure the trust property against risk.
The trustee may not dispose of the trust property in a manner
which could affect adversely or frustrate the purpose of the trust.
In the absence of provisions to the contrary or unless an emer-
gency requires urgent measures, co-trustees must act jointly (col-
lectively).
Trustees who conduct a business of deposit banking must
strictly segregate trust property from other assets, insofar as the
trust relationship does not determine otherwise (trust deposits).
Special records must be kept by persons whose business it is to
act as trustees.
Art. 923
If an inventory has not already been prepared, the trustee must
draw up an inventory of the assets and liabilities of the trust and
the said inventory must be revised annually.
He is required to render accounts annually and to provide in-
formation at any time concerning the state of the trust affairs to
the audit authority provided for in the trust instrument or, in the
absence of such audit authority to the settlor or, if the settlor
should have died or be otherwise unavailable, to the beneficiary
who has a right of claim and in the absence of such beneficiary to
the Princely Liechtenstein Court of Justice, unless the circum-
stances necessitate a deviation as, for instance, in the case of
banking trusts, small trusts or similar.
Where the entitled beneficiary is a partnership or a legal entity
the accounts must be submitted and the information disclosed to
the partner representing the partnership or to the governing bod-
ies in the case of a legal entity.
Where the beneficiary (ies) is (are) not of age, legally inca-
pacitated, insane or mentally deficient, or the rendering of ac-
2. Duties of the
trustee
a. In
general
b. Inventory of
assets and lia-
bilities and
the rendering
of accounts

– 189 –
counts is impractible for any other reason, the trustee shall submit
the accounts to the Princely Liechtenstein Court of Justice.
The trust instrument may also provide for the submission of
accounts in another manner or it may release the trustee from
such requirement.
If the trust property is comprised of an undertaking which is
subject to the provisions of this law concerning commercial ac-
counting, the trustee shall be required to comply with such provi-
sions.
Unless the trust instrument determines otherwise, the judge in
extrajudicial proceedings may for important reasons order an
official audit upon application by an entitled participant. The
result of such audit shall be submitted to the Court as in the case
of legal entities.
Art. 924
Where the trustee is in breach of the provisions of the trust in-
strument or of those of this title otherwise relevant (breach of
trust), he shall be personally liable to the settlor with his entire
assets or, where the settlor is no longer present, to the beneficiary,
pursuant to the principles of the law of contract. The third party
acting in bad faith, however, shall be liable for damages to the
settlor and to the beneficiary pursuant to the regulations relating
to tortious acts, but only insofar as they did not themselves cause
the breach.
In the case of a breach of trust, co-trustees shall be liable
jointly and severally, without limit, if the trust instrument does
not determine otherwise, unless they can prove that they acted
with the care of a prudent businessman in the supervision of the
co-trustee and with reservation of their right of recourse against
the guilty party.
With reservation of the right of recourse or insofar as it does
not result otherwise owing to the circumstances of the particular
trust, the trustee shall be liable for the acts and omissions of a
third party to whom he has delegated the performance of transac-
tions on behalf of the trust or engaged in any other way as, for
instance, an authorised signatory, authorised agent and similar.
c. Responsibility
aa. Breach of trust,
etc.

– 190 –
Art. 925
In the absence of a provision to the contrary in the trust in-
strument and with the exception of his claims for expenses and
compensation, the trustee is not entitled to take any advantages
from the trust.
Where the trust instrument does not make provision other-
wise, the trustee is therefore only entitled to conclude transac-
tions with the trust property on his own account as, for example,
renting or leasing for himself, using money of the trust property
for his own business purposes, making loans to himself, appropri-
ating assets of the trust property for his own account or giving it
to close relatives or friends, insofar as the transactions in question
do not go beyond the scope of orderly administration.
Any other transaction which cannot be rescinded renders the
trustee liable for damages to the settlor or the beneficiary subject
to a right of claim against a third party acting in bad faith.
Where it becomes apparent that the trustee has mixed trust
property money with his own money, he must pay interest on
these monies at one and a half times the normal domestic rate and,
if he has used these moneys profitably in business transactions, he
must render account of such business and provide information
and deliver up in full the share of the profit accruing to the trust
property. Where the amount of profit cannot be determined, the
trustee must also pay interest on such monies at a higher rate,
depending on the circumstances.
Unless the trust instrument determines otherwise, the claims
referred to in the foregoing may be brought by the settlor or, if
the settlor is no longer alive or is otherwise unable to act, by the
beneficiary and, if a beneficiary does not take action, by a trustee
appointed by the Princely Liechtenstein Court of Justice for the
benefit of the trust.
Art. 926
The regulations of the law concerning mandates shall be ap-
plied analogously to the legal relationship between the settlor and
the trustee insofar as deviations do not result from the provisions
of this title or from the particular purpose of the trust or unless
bb. Transaction in
favour of the
trustee
3. Reference, etc.