Gesellschaft mit beschränkter Haftung (pronounced[gəˈzɛlʃaft mɪt bəˈʃʁɛŋktɐ ˈhaftʊŋ], abbreviated GmbH[geː ʔɛm beː haː], in Austria also GesmbH or Ges.m.b.H.), which is German for "company with limited liability", is a type of legal entity
very common in Germany, Austria, Switzerland and Liechtenstein. The name of the GmbH form emphasizes the fact that the owners (Gesellschafter, also known as members) of the entity are not personally liable for the company's debts.GmbHs are considered legal persons under German and Austrian law. Other variations include mbH (used when the term Gesellschaft is part of the company name itself), and gGmbH (gemeinnützige GmbH) for non-profit companies.
The GmbH has become the most common corporation form in Germany, since the AG (Aktiengesellschaft), the other major company form corresponding to a stock corporation, was much more complicated to form and operate until recently.
The laws governing this type of legal entity were adopted in Germany in 1892, and in Austria in 1906. The concept of limited liability created by these laws inspired the legal establishment of the limited liability company form in other countries, although the concept of a limited liability company already existed in the United Kingdom.
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