Risk of a GbR becoming an OHG

As you can tell from reading my posts regularly, there are more than enough stumbling blocks to fall into legally. A topic that is also not on the radar of many is probably the formation of a GbR and the conversion into a OHG.

This happens faster than you think, it warn a none, but the legal consequences can be fatal.

What is a GbR in legal terms? Now. If at least two persons join together for a common purpose, a civil law partnership (GbR) is formed. This happens automatically, a written contract of any kind is not necessary. This can range from taking a vacation together to running an esports team or a joint YouTube channel. Because it is so easy, the legal consequences arising from a GbR are limited. For example, a commitment at the expense of the GbR can only be made jointly. Any changes to this power of representation must then indeed be regulated in a GbR contract.

But often, of course, it does not remain with the completion of a joint vacation or short-term purpose, for which you share the costs. Many Internet projects are – purely officially – operated by GbR. What many people do not realize is that a GbR can be qualified as a general partnership under the Commercial Code more quickly than many would like. This happens automatically when a civil law partnership is commercially active and this commercial activity reaches a certain scope. As soon as the scope of a small business is exceeded (in terms of turnover and/or organizational structure), a commercial enterprise exists.

The German Commercial Code (HGB) and case law also recognize facts in this regard:

(1) commercial activity (as distinct from freelance activity within the meaning of § 18 para. 1 No.1 EStG)

(2) a certain size of the organization, with orientation criteria being a turnover of more than 250,000.00 euros, more than five employees and more than 120,000.00 market value of the business assets.

However, the orientation criteria are not set in stone and it depends on the individual case. In addition, the burden of proof that there is NO commercial enterprise always lies with the small business. The disadvantages of a general partnership can be great, because in a general partnership each partner has sole power of representation and can therefore bind the other partners jointly and severally. If the latter buys a company car, for example, even without an agreement, the other company must be liable for it. Moreover, as a partnership, the OHG is not subject to lower tax rates for corporate income tax, but to income tax at top tax rates. This can already be a significant difference. In addition, the OHG existence, extensive obligations for accounting and for publicity in the commercial register and / or with regard to the balance sheets. The numerous HGB obligations that apply to merchants, such as the obligation to immediately check deliveries and much more, also apply to the general partnership. All in all, therefore, an enormous liability risk. Of course, the OHG comes with better traffic rights and better co-determination, but you have to be aware of their circumstances.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.