A Danish private limited company (anpartsselskab, ApS) is the most common company form for SMEs in Denmark. It combines limited liability with a flexible and relatively simple structure, making it particularly well suited to entrepreneurs, consultants, holding structures and family-owned businesses. An ApS also provides a professional framework around the business — towards customers, suppliers, banks and authorities alike.
Although formation is simpler than for an A/S, a number of formalities, decisions and documents must be in place from the start. A thorough formation process is essential for the company to rest on a robust legal and financial foundation.
Capital requirements and contributions
An ApS must have a share capital of at least DKK 20,000. The capital can be raised in two ways:
Cash contribution
- The capital is paid into an account, typically with a bank.
- The bank issues documentation of the payment, used in the formation process.
Contribution in kind (non-cash assets)
- For example contribution of an existing business, operating assets, inventory or intellectual property rights.
- As a rule, this requires a valuation report from an approved auditor confirming that the values correspond at least to the agreed capital amount.
In our advisory work we help you to:
- set the right capital structure relative to the business's needs and risk,
- assess whether all or part of the capital can usefully be contributed in kind,
- coordinate the process between founder, bank and auditor so payment and documentation run smoothly.
Formalities for incorporating an ApS
Incorporation of an ApS is based on two central documents:
Memorandum of association
- states the founder(s), capital, subscription price and subscription deadline,
- describes whether cash or in-kind contributions are made, and on what terms,
- may contain special arrangements regarding e.g. management, pre-emption and transitional provisions.
Articles of association
- set out the company's name, registered office, purpose, share capital, share classes, governance structure, signing rule, financial year etc.
Where there are multiple owners, the articles should be supplemented by a shareholders' agreement. It is not a legal requirement, but very important in practice, as it governs:
- pre-emption, tag-along and drag-along rights,
- non-compete and loyalty obligations,
- valuation on purchase and sale of shares,
- handling of disagreement, death, divorce and exit.
We assist with:
- drafting and tailoring the memorandum and articles to your specific situation,
- advising what belongs in the articles versus a separate shareholders' agreement,
- ensuring all company law requirements are met from day one.
When the documents are ready, the company is registered digitally with the Danish Business Authority, and the necessary attachments are submitted (e.g. bank documentation and any valuation report). The beneficial owners must also be registered.
Ownership structure and holding
Already at formation it is important to decide whether the operating company should be owned personally or through a holding company. A holding structure can offer significant advantages:
- tax-free dividends from the operating company to the holding (under the conditions of the Danish Corporation Tax Act),
- protection of accumulated capital from risks in operations,
- flexibility on later sale, succession or entry/exit of co-owners.
We advise on when a holding structure is relevant — and when it simply adds unnecessary complexity — and help carry out the formation in the desired structure.
Management requirements for an ApS
The governance structure of an ApS is flexible. The company can have:
- an executive management alone (typical for small companies with few owners),
- an executive management and a board, or
- an executive management and a supervisory board.
The executive management handles day-to-day operations, while any board has overall strategic responsibility and supervises the executive management. Management must comply with requirements concerning:
- fit-and-proper status (no bankruptcy disqualification etc.),
- sound business management,
- correct handling of capital adequacy and creditor protection.
We advise on:
- choice of governance structure based on the ownership and complexity of the business,
- division of roles between owners, executive management and any board,
- drafting the signing rule — e.g. whether the company is bound by the CEO alone, by two members of management jointly, or by a specific combination.
Ongoing formal requirements
Even as an ApS, the company is subject to a range of ongoing obligations:
Annual report
- must be prepared under the Danish Financial Statements Act and filed with the Business Authority,
- many small ApSs can opt out of audit if the conditions for doing so are met.
General meeting
- ordinary general meeting at least once a year,
- requirements for correct convening, agenda and minutes.
Bookkeeping and documentation
- ongoing bookkeeping under the Danish Bookkeeping Act,
- documentation of vouchers, shareholders' agreements and material decisions.
Notifications to the Danish Business Authority
- changes to capital, management or articles must be notified and registered,
- beneficial owners must be registered and kept up to date.
We help you establish a practical annual cycle so these requirements are integrated into daily operations from the start — and so you avoid surprises when accounts and filings approach.
Strategic considerations when choosing the ApS
An ApS is typically the right choice when you:
- want to run a business with limited personal liability,
- need a simple and flexible ownership and governance structure,
- want a professional framework without the stricter requirements that apply to an A/S,
- plan over time to build a holding and group structure around the business,
- want to retain and motivate key employees through e.g. co-ownership or warrants.
The aim of our assistance is not merely to get the company registered — but to create a robust and scalable structure that can handle growth, new co-owners and changing needs, without unnecessarily complex restructurings later on.