Simplified trading company STC(LLC)

Simplified trading company – STC(LLC)

Simplified Trading Companies (STCs), akin to Limited Liability Companies (LLCs), present a recent and accessible avenue for startups to initiate their ventures. Unlike traditional LLCs, STCs feature a unique setup, allowing a maximum of three founders with a nominal founding contribution as low as one euro. Additionally, STCs mandate a mandatory reserve allocation from profits to safeguard against potential losses.

Features that distinguish the Simplified Trading Company from LLC and LLC
  1. Minimal Capital Requirements:
    • The minimum founding capital for an STC stands at a mere 1 euro.
    • The smallest nominal business share is set at 10 cents.
    • Both the basic capital and business share values must be whole numbers in euros.
  2. Financial Transactions:
    • Deposits for business shares are exclusively accepted in monetary form.
    • Company registration in the commercial register follows full payment of business share deposits.
  3. Mandatory Reserve:  Financial Safety Net:
  • A mandatory reserve, equivalent to one quarter of the company’s annual profit (as per financial statements), is obligatory.
  • This reserve is adjusted by deducting losses from the previous fiscal year.
  1. Utilization of Mandatory Reserve:
    • The mandatory reserve can be employed for:
      1. Increasing share capital through distributed reserves.
      2. Covering annual losses not offset by the previous year’s profits.
      3. Addressing losses from the prior year if not covered by the current year’s profits.

Capital Growth and Form Change: Evolution and Transformation:

  • If an STC raises its share capital to meet or exceed the LLC’s minimum requirement of 5000 euros, the company can transition to a different form.
  • The manager must update the business shares ledger and issue certificates upon request for any changes in share size or voting rights.
Why it is a great choice for start-up companies

By introducing this form of trading company, it is possible for anyone who has a good idea to start a business with only one euro as a founding capital and as such it is an excellent choice for any startup without the need for a large founding investment and large investments

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