The Liechtenstein Establishment is a type of legal entity governed by civil law and it must not be confused with an entity under public law which is common in the legal systems of other countries. The civil-law Establishment is a legal entity. Only the Establishment's assets are available to meet the liabilities of the Establishment.
In the case of an Establishment with founder’s rights (the most common type of a Liechtenstein Establishment) the holder(s) of the founder's rights is (are) usually the supreme corporate body. The founder’s rights can also be bequeathed or transferred inter vivos by means of a declaration of assignment. In the case of an Establishment with no founder’s rights (Establishment with no founder’s rights), the administration will be the supreme corporate body. An Establishment is managed by the board of directors. It is generally incumbent upon the board of directors to manage the Establishment's business and to represent the Establishment in its relations with third parties. The board of directors can consist of one or more members. The holder(s) of the founder's rights can also themselves be a member of the administration. If an Establishment conducts a business run along commercial lines or if its purpose as laid down in the articles of association allows such a business to be conducted, an audit authority must be appointed. Unless otherwise provided in the articles of association, the audit authority is appointed by the supreme corporate body. In addition, a legal representative (registered agent) must be appointed as well, unless a domestic address for service has been designated. The legal representative is the official mail address and the contact point for the authorities.
The purpose of a Liechtenstein Establishment can be of an economic or non-economic nature and it can be in any legally permissible form, e.g. trade in goods, acquisition of participations, financing, management of real estate, management of assets for specific beneficiaries or for purely charitable purposes. The purpose of the Establishment must thus be lawful and reasonable and it must be in line with good morals. In any case, it must be evident from the provision on the purpose of the Establishment whether or not a business run along commercial lines is carried out. However, banking transactions may be carried out only by banks, and asset management activities for third parties may be carried out only by licensed Liechtenstein trustees.
The structure of a Liechtenstein Establishment can be similar to that of a corporate entity or its basic characteristics can be similar to those of a foundation, and, depending on its structural set-up, it can be used for commercial purposes or for asset management purposes. Most Establishments in Liechtenstein are Establishments with no members or stakeholders or shareholders and, in most cases, the capital is not divided into shares.
The corporate name can be freely chosen, even made-up names and terms denoting an object are permissible, unless they contradict the main purpose. However, the unabbreviated addition „Anstalt“ or the foreign-language additions „Establishment“ or „Etablissement“ must be included in the name. In addition, if there is a link between the Establishment and the bearer of the name, personal names can be used as well.
The capital as laid down in the articles of association can be specified in Swiss francs, euros or US dollars. However, the minimum nominal capital must always be complied with. The minimum capital is CHF 30,000.00, EUR 30,000.00 or USD 30,000.00. If the Establishment’s capital is divided into shares, it must be at least CHF 50,000.00, EUR 50,000.00 or USD 50,000.00. The formation of the Establishment can be in cash or in kind. The minimum capital must have been fully paid up or contributed upon the formation of the Establishment. The capital is at the Establishment’s free disposal, as soon as it has been entered in the commercial register.
The formation of a Liechtenstein Establishment does not require more than one individual or legal entity. A Liechtenstein Establishment is formed by means of a deed of formation and articles of association. The formation of an Establishment does not require a public deed. However, a Liechtenstein Establishment does not come into being until it has been entered in the commercial register.
Articles of association
The articles of association of a Liechtenstein Establishment must contain the legally required information or provisions. Usually, an Establishment also has beneficiaries, i.e. persons that derive economic benefits from the Establishment due to a provision to this effect in the articles of association. Failing any such provision to this effect, there is a legal presumption that the holder of the founder's rights themselves is the beneficiary.
Accounting and bookkeeping provisions
Establishments which conduct a business run along commercial lines are required to keep an orderly business accountancy. If an Establishment does not conduct a business run along commercial lines, it must, taking into consideration the principles of orderly bookkeeping, maintain appropriate records of the financial circumstances and keep documentary evidence presenting a comprehensible account of the course of business and the development of the assets.
The fees for the entry of a new Liechtenstein Establishment in the register amount to CHF 700.00. Depending on the amount of the Establishment’s capital, this fee can increase accordingly, up to a maximum amount of CHF 10,000.00. In addition, there are also fees for each signature authority to be entered and for each entry of a position.
Statutory basis (German only)