By the development of new products or by the development of new business branches every successful employer wants to strengthen and increase the economical success of his/her business. But for such activities the same precautions should be valid as those that are deeply recommended to new employers and founders of a new existence: to safeguard that in case of a not very rosy business development of the new branch or even an absolute failure, the own existence is not ruined by the debts of the unsuccessful existence foundation.
The pharmaceutical industry has learnt for a long time and therefore establishes mostly new businesses with a separate structure of responsibility for new developments. The advantage: as the main business founds a separate limited company (for example: GmbH or Ltd.) the risks of responsibility for the product and other risks, which the new company with its new products is exposed to cannot fall back onto the main business. The disadvantage: Because of the high costs and the capital of responsibility which must be raised, the major industry is mostly the only one who is able to afford the establishment of separate GmbHs or AGs for any new or test projects. But also smaller businesses can learn and profit from the experience of the major industry: You can easily carry out all the above mentioned advantages with a separate Limited Company without high costs or high capital expenditure. Actually the English Limited Company is even much more suitable for this purpose than a German or Austrian GmbH, because according to demand the minimum capital can be kept much lower than DM 50.000,-- or ATS 500.000,-- or commensurately Lira. The subscribed minimum capital is only two pounds Sterling with an English Limited. Another advantage: separate company sectors can be delimited from each other by different names etc.