Application for registration by a limited liability company managing director appointed subject to a condition precedent

A managing director whose appointment is subject to a condition precedent, i.e. only becomes effective at a later date, is authorized to apply for registration in the commercial register on behalf of the company. This was the subject of a decision by the Higher Regional Court of Hamm ("OLG") on June 15, 2023.

Facts of the case

The decision of the OLG Hamm is based on the following facts: By resolution dated April 11, 2023, the shareholders of a limited liability company ("GmbH") appointed a new managing director with effect from May 1, 2023. The new managing director signed the registration of the appointment as managing director in the commercial register together with another managing director. As instructed, the notary did not forward the application to the commercial register for entry until May 4, 2023.

The register court rejected the application as the new managing director was not yet authorized to register at the time of the declaration to the notary.

The decision of the OLG Hamm of June 15, 2023 (Ref. I-27 W42/23)

The OLG Hamm overturned the decision of the register court on appeal by the notary. In the present case, the newly appointed managing director was entitled to register in accordance with Section 39 of the Limited Liability Companies Act (GmbHG).

The newly appointed managing director's right to file the application for registration was not precluded by the fact that his appointment was subject to a condition precedent. The relevant shareholder resolution on which the appointment was based had already been passed. The effectiveness of the appointment was only to take effect at a later date. In particular, it was irrelevant that the managing director had not yet been entered in the commercial register at the time the application was signed.

Practical advice

Appointments of managing directors of a GmbH must be registered with the commercial register. As a rule, the managing directors of the company in the number authorized to represent the company are responsible for this. The newly appointed managing director is already entitled to file an application, as the entry in the commercial register does not constitute a legal basis.

Sometimes a change of managing director should be entered in the commercial register on a specific date if possible. In practice, however, it is not possible to make such registration on a specific date.

In principle, the appointment of a new managing director first requires a corresponding shareholder resolution. The managing directors then have to sign the application for the appointment to the commercial register before a notary. The notary forwards the application to the commercial register for registration. For practical reasons, this process can often not be completed in one day. The register court examines the submitted application which usually requires a few days. The registration is only made once this examination has been completed. However, it is also not a solution to submit the application a few days before the target date. Future facts are not registrable, which is why such an application would be rejected.

The ruling of Hamm Higher Regional Court shows a way to achieve registration as soon as possible after the target date. By appointing managing directors subject to a condition precedent, the application for registration can be prepared by the shareholders before the target date. The signing of the application by the managing directors before the notary can also be done "in advance". Only the submission by the notary may not take place before the cut-off date in order to avoid a rejection by the registry court. The notary must therefore be instructed accordingly to make the submission at a later date. Nevertheless, it is not possible to make an entry in the commercial register on the exact date, as the register court still has to examine it. In practice, however, this is not a problem, as the new managing director can effectively represent the company from the time he is appointed and not only from the time of entry in the commercial register. It should therefore be carefully considered on a case-by-case basis whether one wishes to take the path outlined by the Hamm Higher Regional Court. The Federal Court of Justice has not yet confirmed the opinion of the Higher Regional Court of Hamm, meaning that individual registry courts could still decide differently, which could result in a considerably longer delay in registration.