In the case of an AG, the founders appoint the auditors for the
AG’s first full or partial fiscal year and appoint the initial supervi-
sory board (Aufsichtsrat), which in turn appoints the first board of
The appointment of the auditors and the
supervisory board must be certifed by a public notary. The mem-
bers of the boards (management and supervisory) must be indi-
viduals but need not be citizens or residents of Germany. They can
be shareholders, but cannot simultaneously be members of both
the management and supervisory boards.
The founders must also
prepare a formation report (Gründungsbericht), in which they are
required to describe the transactions leading up to the formation,
the initial acquisition of assets, capital contributions in kind, and
special advantages or remuneration granted to the members of
the management or supervisory boards. In addition, the formation
of an AG must be examined by the members of both boards and,
under certain circumstances, the auditors may be required to
issue an examination report.
The founders and members of the
management and supervisory boards must submit the application
to register the AG in the commercial register maintained by the
local court where the AG has its registered offce. The AG comes
into legal existence upon registration.