Statute

In the legal context, a statute is the central legal basis that determines which law a specific subject or legal relationship is subject to. As a legal statute—often referred to as a corporate statute, association statute, or foundation statute—it specifies, for example, in a GmbH that all internal matters are governed by the German GmbH Act (GmbHG). In corporate law, the statute regulates formation, organization, liability, and powers of representation; in association and foundation law, it defines purpose, members' rights, and bodies. Internationally, the term gains significance through the seat state principle and the founding statute: Depending on whether the actual seat or the place of incorporation is decisive, a company is subject to the law of the seat state or the founding state. Thus, the statute plays a key role in international private law, in the M&A sector, and in the location choice of start-ups. For registry courts, the term statute appears less frequently; here, terms like articles of association or founding document are more common. Nevertheless, the statute remains an indispensable term for lawyers, notaries, and entrepreneurs who need clarity about the applicable law and the resulting duties and rights.