What are the liability risks for managing directors of a GmbH?
July 14, 2022 | 55,00 EUR | answered by Otto König
Dear lawyer,
I am reaching out to you with a question regarding corporate law, specifically concerning the liability risks for managing directors of a GmbH. I am the managing director of a GmbH and would like to learn more about my legal duties and risks in this position.
To provide some background: I have recently been appointed as the managing director of a GmbH, taking on a responsible role in the company. As a managing director, I have a high level of responsibility for the business of the GmbH and want to ensure that I fulfill my duties in a legally correct manner.
At the moment, I am not fully clear on the current situation, especially regarding my liability as a managing director. I am concerned about the personal risks I face and how I can protect myself. It is important to me to carry out my duties as a managing director in a legally secure way and to minimize potential liability risks.
Therefore, my question to you is: What specific liability risks exist for managing directors of a GmbH and how can I protect myself from them? What legal duties must I as a managing director adhere to in order to limit my liability? Are there any special insurances or measures I can take to safeguard myself?
I appreciate your assistance in advance and look forward to your expert advice.
Kind regards,
Benjamin Hohenwarter
Dear Mr. Hohenwarter,
Thank you for your inquiry regarding the liability risks for directors of a GmbH. As a newly appointed director, it is understandable that you are concerned about your legal obligations and risks. Indeed, directors of a GmbH bear a high level of responsibility and must be aware that they can be held personally liable.
The liability risks for directors of a GmbH are diverse and can be both civil and criminal in nature. The most important liability risks include delaying insolvency proceedings, unauthorized actions, breach of duties under the articles of association or the GmbH Act, as well as non-compliance with tax obligations. In the event of a loss, directors may be personally liable if they have breached their duties.
To minimize your liability risks, it is important to adhere to your legal obligations as a director. This includes carefully managing the business, complying with legal and contractual duties, maintaining proper bookkeeping, and filing for insolvency in a timely manner in case of imminent insolvency. By fulfilling these duties diligently, you can limit your liability.
Additionally, you can also secure yourself with insurance to protect yourself against liability risks. A directors and officers liability insurance (D&O insurance) can provide you with financial protection in case you are held accountable for breaches of duty. This insurance can limit your personal liability and provide you with security.
It is advisable to seek regular advice from an experienced corporate lawyer to stay up to date and identify legal risks early on. A good legal advisor can help you exercise your duties as a director in a legally compliant manner and minimize your liability risks.
I hope this information is helpful to you and I am available for further questions.
Kind regards,
Otto König, Corporate Lawyer
