The short answer
For a Germany-only business, the GmbH/UG question is solvable today and EU Inc may be a distraction. EU Inc’s value for German founders appears when you raise from international investors or expand across EU borders — the places where the GmbH’s procedural overhead and German-specific ESOP rules become friction.
Side by side
| Dimension | GmbH / UG | EU Inc (proposed) |
|---|---|---|
| Min. capital | GmbH €25,000 (€12,500 paid up) / UG from €1 | To be defined; access for all companies (pillar 3 — under threat) |
| Formation | Notary required; procedural | Single-registry filing intended |
| Stock options | German ESOP historically clunky (VSOP debates) | Standardized tax-on-sale (pillar 4 — under threat) |
| Cross-border | Germany only; subsidiaries abroad needed | One standard across 27 member states |
| Investor familiarity | Very high within DACH | Unproven until adoption |
When to stay in a GmbH/UG
Honest answer: if you are a DACH-focused company raising from DACH investors, the GmbH is the default for a reason — familiar, predictable, and well understood. The capital requirement is annoying but solved. Do not migrate out of novelty.
When EU Inc wins for you
- You are raising from international / non-German funds that find the GmbH bureaucratic or dislike German ESOP rules.
- You will expand across EU countries and want one entity instead of a GmbH + foreign subsidiaries.
- You want a cleaner, standardized ESOP for international hires (if pillar 4 survives).
Migration from GmbH → EU Inc
The German migration path carries real specifics: notarial exit from the Handelsregister, the €25,000 capital treatment, and converting German share instruments into EU Inc ones. As with the SAS, the share-class and ESOP mapping is where errors get expensive. The diagnostic indicates where a situation stands, or read what EU Inc actually is.