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Aktiengesellschaft (German pronunciation: [ˈaktsi̯ənɡəˌzɛlʃaft]; abbreviated AG, pronounced [aːˈgeː]) is a German word for a corporation limited by share ownership (i.e. one which is owned by its shareholders) whose shares may be traded on a stock market. The term is used in Germany, Austria, Switzerland and South Tyrol for companies incorporated in the German-speaking region of Italy. It is also used in Luxembourg (as Aktiëgesellschaft), although the French-language equivalent, Société Anonyme, is more common.[not in citation given]
Meaning of the wordEdit
The German word Aktiengesellschaft is a compound noun made up of two elements: Aktien meaning shares, and Gesellschaft in this context meaning corporation; from its other meaning of an organized group working together, and periodically meeting, because of common interests (Society). An English translation can therefore be "share corporation" or joint-stock company. In German the use of the term Aktien for shares is restricted to Aktiengesellschaften. Shares in other types of German companies (e.g. GmbH) are called Anteile rather than Aktien.
In Germany and Austria, the legal basis of the AG is the German Aktiengesetz (abbr. AktG) or the Austrian Aktiengesetz (abbr. AktG). Since the German commercial law (§ 19 Handelsgesetzbuch) requires all corporations to specify their legal form in their name, for the purposes of informing the public of the limits on their liability, all German (required by § 4 Aktiengesetz) and Austrian stock corporations include Aktiengesellschaft or AG as part of their name, frequently as a suffix.
In Switzerland, the Company Limited by Shares (or Aktiengesellschaft in German, société anonyme in French, società anonima in Italian, societad anonima in Romansh) is defined in Title Twenty-Six of the Code of Obligations. Article 950 specifies that the business name must indicate the legal form.
German AGs have a "two-tiered board" structure, consisting of a supervisory board (Aufsichtsrat) and a management board (Vorstand). The supervisory board is generally controlled by shareholders, although employees may have seats, depending on the size of the company. The management board directly runs the company, but its members may be removed by the supervisory board, which also determines the management board's compensation. Some German AGs have management boards which determine their own remuneration, but that situation is now relatively uncommon.
The general meeting is the supreme governing body of a Swiss company limited by shares. It elects the board of directors (Verwaltungsrat in German) and the external auditors. The board of directors may appoint and dismiss persons entrusted with managing and representing the company.
Other countries have similar forms[clarification needed] of company:
- Denmark – Aktieselskab (A/S)
- Norway – Aksjeselskap (AS)
- Sweden – Aktiebolag (AB)
- Finland – Osakeyhtiö (Oy)
- Turkey – Anonim Şirket (A.Ş.)
- Argentina, Bolivia, Costa Rica, Peru, Spain and other Spanish speaking countries – Sociedad Anónima (S.A.)
- Portugal – Sociedade Anónima (S.A.)
- Brazil – Sociedade Anônima (S.A. or S/A or SA)
- Bulgaria – Акционерно дружество (Akcionerno druzhestvo), derived directly from the German AG
- Russia – Публичное акционерное общество (Publichnoe akcionernoe obschestvo) (ПАО)
- Belgium (Dutch part), Netherlands – Naamloze Vennootschap (N.V.)
- Belgium (French part), France – Société Anonyme (S.A.)
- Poland – Spółka akcyjna (S.A.)
- Italy – Società per Azioni (SpA)
- United Kingdom – Public limited company (Plc)
- Romania – Societate pe acțiuni or "Societate anonimă" (S.A.)
- Fohlin, Caroline (November 2005). "Chapter 4: The History of Corporate Ownership and Control in Germany". In Morck, Randall K. A History of Corporate Governance around the World: Family Business Groups to Professional Managers (PDF). University of Chicago Press. pp. 223–282. ISBN 0-226-53680-7.
- E McGaughey, 'The Codetermination Bargains: The History of German Corporate and Labour Law' (2016) 23(1) Columbia Journal of European Law 135
- Franks, Julian; Colin Mayer (2001). "Ownership and Control of German Corporations". The Review of Financial Studies. Oxford University Press. 14 (4): 943–977. doi:10.1093/rfs/14.4.943. JSTOR 2696732.
- German Stock Corporations Act 1965 translation