# What is GmbH?

**URL:** <https://boards.straightdope.com/t/what-is-gmbh/252263>\
**Category:** Factual Questions\
**Created:** [June 26, 2004, 12:59am UTC](https://boards.straightdope.com/t/what-is-gmbh/252263 "2004-06-26T00:59:03Z")\
**Posts on this page:** 5\
**Page:** 1

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**Author:** ![Trigonal\_Planar](https://avatars.discourse-cdn.com/v4/letter/t/0ea827/32.png) [@Trigonal\_Planar](https://boards.straightdope.com/u/Trigonal_Planar)\
**Post date:** [June 26, 2004, 12:59am UTC](https://boards.straightdope.com/t/what-is-gmbh/252263/1 "2004-06-26T00:59:03Z")

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I often see this string of letters beside German company names. What the heck does it mean?

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**Author:** ![Q.E.D](https://avatars.discourse-cdn.com/v4/letter/q/51bf81/32.png) [@Q.E.D](https://boards.straightdope.com/u/Q.E.D)\
**Post date:** [June 26, 2004, 1:05am UTC](https://boards.straightdope.com/t/what-is-gmbh/252263/2 "2004-06-26T01:05:58Z")

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Someone asked this here a while ago (last year?). It’s a German abbreviation which stands for “Gesellschaft mit beschraenkter Haftung”, and translates roughly to “corporation with limited liability”.

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**Author:** ![Tim\_T-Bonham.net](https://avatars.discourse-cdn.com/v4/letter/t/46a35a/32.png) [@Tim\_T-Bonham.net](https://boards.straightdope.com/u/Tim_T-Bonham.net)\
**Post date:** [June 26, 2004, 3:41am UTC](https://boards.straightdope.com/t/what-is-gmbh/252263/3 "2004-06-26T03:41:44Z")

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So almost an exact translation of the abbreviation “LLC” (Limited Liability Company) that you will sometimes see on American company names.

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**Author:** ![633squadron](https://avatars.discourse-cdn.com/v4/letter/6/ee59a6/32.png) [@633squadron](https://boards.straightdope.com/u/633squadron)\
**Post date:** [June 26, 2004, 8:05pm UTC](https://boards.straightdope.com/t/what-is-gmbh/252263/4 "2004-06-26T20:05:39Z")

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> [@Trigonal Planar](#):
>
> I often see this string of letters beside German company names. What the heck does it mean?

And similarly “AG” means “Allgemeines Gesellschaft” or “public corporation.”

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**Author:** ![kellner](https://avatars.discourse-cdn.com/v4/letter/k/c2a13f/32.png) [@kellner](https://boards.straightdope.com/u/kellner)\
**Post date:** [June 26, 2004, 8:41pm UTC](https://boards.straightdope.com/t/what-is-gmbh/252263/5 "2004-06-26T20:41:04Z")

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> [@633squadron](#):
>
> And similarly “AG” means “Allgemeines Gesellschaft” or “public corporation.”

It stands for _ **A** ktien__g_\*esellschaft\* - “stock corporation”.  
I don’t know how exactly the differences translate to the american system, but:  
[ul]  
[li]a GmbH is easier to found[/li][li]the internal structure is more flexible[/li][li]the obligation to report results/news to the public is relaxed [/li][li]AGs can’t impose any obligations upon the shareholders[/li][li]GmbHs can’t be traded publicly at a stock exchange[/li][/ul]  
Many of the differences exist to facilitate public trading of AG-stocks, so you can buy those without the need to read any fine print. As a rule of thumb smaller corporations are more likely to be GmbHs, but there is a big overlap. For example many joint-ventures are GmbHs if they is not intention to trade shares publicly.  
In addition to that there are a few forms of corporation with full liability for one or more shareholders.