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A stiftung () (properly ''Stiftung'', pl. ''Stiftungen'') is an institution/foundation which, with the aid of a property, pursues a purpose determined by the founder. A ''stiftung foundation'' exists to give effect to the stated, non-commercial wishes of its founder, as set out in a foundation deed and the articles of association (statutes). In effect, the assets with which the foundation is endowed become a separate legal entity. A stiftung foundation has no shares or members and is set up by a founder(s) in most cases to ensure the continuation of family assets. A stiftung foundation can have beneficiaries, and in that way they are in some way similar to the
common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omniprese ...
notion of trusts. The founders also have the right to transfer and terminate the foundation. Stiftungen are purely
not for profit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...
enterprises and commercial activities are generally not permitted to be conducted by them. This is the primary difference between an
anstalt An Anstalt () or Anstalt partnership is a type of incorporated organisation. Characteristics An Anstalt is a hybrid between a company limited by shares and a foundation.
and a stiftung. Stiftungen are usually administered by a board of
trustee Trustee (or the holding of a trusteeship) is a legal term which, in its broadest sense, is a synonym for anyone in a position of trust and so can refer to any individual who holds property, authority, or a position of trust or responsibility to ...
s, and there is no registration required to establish them.


Theory

The time course of the sum of the income from a foundation (or a single endowment) for various effective annual (inflation-adjusted) yield n from the donated capital without taking into account future donations.The idea of a foundation is that in spite of the continuous use of the income for the purpose of the foundation (i.e., not for compound interest), the total amount after a certain time exceeds the funded foundation stock. With a yield of, for example, four percent (lilac line), the sum of the income earned the founding capital after 25 years, after which the sum of the income is greater than the basic stock capital (green area in the upper right corner).


History

Stiftungen have a long tradition.
Plato Plato ( ; grc-gre, Πλάτων ; 428/427 or 424/423 – 348/347 BC) was a Greek philosopher born in Athens during the Classical period in Ancient Greece. He founded the Platonist school of thought and the Academy, the first institutio ...
had established his
academy An academy (Attic Greek: Ἀκαδήμεια; Koine Greek Ἀκαδημία) is an institution of secondary or tertiary higher learning (and generally also research or honorary membership). The name traces back to Plato's school of philosop ...
as a foundation and it lasted from 347 BC to 529 AD. In the early
Middle Ages In the history of Europe, the Middle Ages or medieval period lasted approximately from the late 5th to the late 15th centuries, similar to the post-classical period of global history. It began with the fall of the Western Roman Empire ...
, many
nobles Nobility is a social class found in many societies that have an aristocracy. It is normally ranked immediately below royalty. Nobility has often been an estate of the realm with many exclusive functions and characteristics. The characteri ...
founded towns as ''stiftung-like'' legal entities, a technique which was soon used to establish hospitals,
orphanage An orphanage is a residential institution, total institution or group home, devoted to the care of orphans and children who, for various reasons, cannot be cared for by their biological families. The parents may be deceased, absent, or abu ...
s and other non-profit organizations. It was the establishment of monastic communities, however, mostly in the
south South is one of the cardinal directions or compass points. The direction is the opposite of north and is perpendicular to both east and west. Etymology The word ''south'' comes from Old English ''sūþ'', from earlier Proto-Germanic ''*sunþa ...
ern and
east East or Orient is one of the four cardinal directions or points of the compass. It is the opposite direction from west and is the direction from which the Sun rises on the Earth. Etymology As in other languages, the word is formed from the fa ...
ern border regions of the
Holy Roman Empire The Holy Roman Empire was a political entity in Western, Central, and Southern Europe that developed during the Early Middle Ages and continued until its dissolution in 1806 during the Napoleonic Wars. From the accession of Otto I in 962 ...
, where the theory of stiftung developed most. Many famous church buildings and monasteries were early foundations of stiftung activity. Many of the 9th century foundations survive today notably in
Wemding Wemding () is a town in the Donau-Ries district of Bavaria, Germany. Wemding is situated on the edge of the Ries meteorite crater in the Geopark Ries. Wemding is the location of the ''Zeitpyramide'' ( Time pyramid), a public art work begun in 1 ...
,
Bavaria Bavaria ( ; ), officially the Free State of Bavaria (german: Freistaat Bayern, link=no ), is a state in the south-east of Germany. With an area of , Bavaria is the largest German state by land area, comprising roughly a fifth of the total l ...
which dates back to the 10th century.
Otto I Otto I (23 November 912 – 7 May 973), traditionally known as Otto the Great (german: Otto der Große, it, Ottone il Grande), was East Frankish king from 936 and Holy Roman Emperor from 962 until his death in 973. He was the oldest son of Henr ...
donated the lady's donation at
Quedlinburg Abbey Quedlinburg Abbey (german: Stift Quedlinburg or ) was a house of secular canonesses ''(Frauenstift)'' in Quedlinburg in what is now Saxony-Anhalt, Germany. It was founded in 936 on the initiative of Saint Mathilda, the widow of the East Fran ...
which lasted from 936 to 1802. When
Roman law Roman law is the legal system of ancient Rome, including the legal developments spanning over a thousand years of jurisprudence, from the Twelve Tables (c. 449 BC), to the '' Corpus Juris Civilis'' (AD 529) ordered by Eastern Roman emperor Jus ...
began to take root in Germany during the 13th century, many social structures changed including considerable urbanization. Numerous Stiftung foundations were created at this time and many have survived the vicissitudes of history. Stiftung foundations took on a distinctly non-profit nature in response to the invention of
corporation A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and ...
s under the
legal scholar Law is a set of rules that are created and are enforceable by social or governmental institutions to regulate behavior,Robertson, ''Crimes against humanity'', 90. with its precise definition a matter of longstanding debate. It has been vario ...
and
Pope The pope ( la, papa, from el, πάππας, translit=pappas, 'father'), also known as supreme pontiff ( or ), Roman pontiff () or sovereign pontiff, is the bishop of Rome (or historically the patriarch of Rome), head of the worldwide Cathol ...
,
Innocent IV Pope Innocent IV ( la, Innocentius IV; – 7 December 1254), born Sinibaldo Fieschi, was head of the Catholic Church and ruler of the Papal States from 25 June 1243 to his death in 1254. Fieschi was born in Genoa and studied at the universit ...
. Burger Hospital and wine shop *The stiftung foundation of
Bürgerspital zum Heiligen Geist Burger Hospital and wine shopThe Bürgerspital zum Heiligen Geist (Citizens' Hospital of the Holy Spirit) is a Stiftung (foundation) in Würzburg. It operates several senior citizens' homes and a geriatric rehabilitation clinic. The economic fou ...
in
Würzburg Würzburg (; Main-Franconian: ) is a city in the region of Franconia in the north of the German state of Bavaria. Würzburg is the administrative seat of the '' Regierungsbezirk'' Lower Franconia. It spans the banks of the Main River. Würzbur ...
is a good example of how they function. Founded in 1316, it is only one of about 250 examples of foundations that are older than 500 years which still exist today. The foundation provides
geriatric Geriatrics, or geriatric medicine, is a medical specialty focused on providing care for the unique health needs of older adults. The term ''geriatrics'' originates from the Greek γέρων ''geron'' meaning "old man", and ιατρός ''iatros' ...
services for the citizens of the burger, and is funded by the
vineyard A vineyard (; also ) is a plantation of grape-bearing vines, grown mainly for winemaking, but also raisins, table grapes and non-alcoholic grape juice. The science, practice and study of vineyard production is known as viticulture. Vine ...
on the foundations estates. *The well-known social housing stiftung,
Fuggerei The Fuggerei is the world's oldest public housing complex still in use. It is a walled enclave within the city of Augsburg, Bavaria. It takes its name from the Fugger family and was founded in 1516 by Jakob Fugger the Younger (known as "Jakob F ...
in
Augsburg Augsburg (; bar , Augschburg , links=https://en.wikipedia.org/wiki/Swabian_German , label=Swabian German, , ) is a city in Swabia, Bavaria, Germany, around west of Bavarian capital Munich. It is a university town and regional seat of the '' ...
, which is regarded as the oldest still existing
social housing Public housing is a form of housing tenure in which the property is usually owned by a government authority, either central or local. Although the common goal of public housing is to provide affordable housing, the details, terminology, d ...
settlement, was founded in 1519, by the leading inhabitants of the town (foundation letter of 1521) and is therefore a few years younger than the social housing foundation of
Valentin Ostertag Valentin is a male given name meaning "strong, healthy, power, rule, terco". It comes from the Latin name ''Valentinus'', as in Saint Valentin. Commonly found in Spain, Romania, Bulgaria, France, Italy, Russia, Ukraine, Scandinavia, Latin America ...
. *The Städelsche Kunstinstitut and Städtische Galerie (
museum A museum ( ; plural museums or, rarely, musea) is a building or institution that cares for and displays a collection of artifacts and other objects of artistic, cultural, historical History (derived ) is the systematic study and th ...
and art gallery) in
Frankfurt am Main Frankfurt, officially Frankfurt am Main (; Hessian dialects, Hessian: , "Franks, Frank ford (crossing), ford on the Main (river), Main"), is the most populous city in the States of Germany, German state of Hesse. Its 791,000 inhabitants as o ...
is one of the most important German art museums with a collection of more than 4000 paintings from the Middle Ages to Modern and
Contemporary Art Contemporary art is the art of today, produced in the second half of the 20th century or in the 21st century. Contemporary artists work in a globally influenced, culturally diverse, and technologically advancing world. Their art is a dynamic co ...
. The early modern era saw the foundation of
Francke Foundation in Halle The Francke Foundations (Franckesche Stiftungen), also known as Glauchasche Anstalten were founded in 1695 in Halle, Germany as a Christian, social and educational work by August Hermann Francke The Francke Foundations are today a non-profit e ...
in the year 1698, the Foundation Städelsches Kunstinstitut, 1815 and the
Carl-Zeiss-Stiftung The Carl-Zeiss-Stiftung (Carl Zeiss Foundation), legally located in Heidenheim an der Brenz and Jena, Germany, and with its administrative Headquarter in Stuttgart, is the sole shareholder of the two companies Carl Zeiss AG and Schott AG. It w ...
in 1889. The 20th century was a low point for stiftungen. The hyperinflation of the 1920-1930s, the rise of the
third Reich Nazi Germany (lit. "National Socialist State"), ' (lit. "Nazi State") for short; also ' (lit. "National Socialist Germany") (officially known as the German Reich from 1933 until 1943, and the Greater German Reich from 1943 to 1945) was ...
and the division of Germany, especially
communist Communism (from Latin la, communis, lit=common, universal, label=none) is a far-left sociopolitical, philosophical, and economic ideology and current within the socialist movement whose goal is the establishment of a communist society, a ...
control of
East Germany East Germany, officially the German Democratic Republic (GDR; german: Deutsche Demokratische Republik, , DDR, ), was a country that existed from its creation on 7 October 1949 until its dissolution on 3 October 1990. In these years the state ...
saw the decline in the formation of new stiftungen, and many older foundations ran their course. During
National Socialist Nazism ( ; german: Nazismus), the common name in English for National Socialism (german: Nationalsozialismus, ), is the far-right totalitarian political ideology and practices associated with Adolf Hitler and the Nazi Party (NSDAP) in Na ...
rule, foundations that did not exclusively benefit the German ( Aryan) people were officially classified as “non-charitable”. Since this directly affected their taxation status, it allowed the government to deduct assets. Furthermore, Jewish-ran foundations were seized during National Socialist rule, and the revenue went directly to the German government. Many
Jewish Jews ( he, יְהוּדִים, , ) or Jewish people are an ethnoreligious group and nation originating from the Israelites Israelite origins and kingdom: "The first act in the long drama of Jewish history is the age of the Israelites""The ...
foundations were liquidated and looted. Those foundations that did continue to exist were aryanised and given Nazi-friendly leadership.   Changes in the charitable law and the foundation civil law (as of 2000) and the associated broader public debate on the meaning and value of foundations, together with the strong growth of private assets and the re-emergence of the concept of citizenship, have ensured that as many foundations are formed in a year today as were in a decade at the end of the 20th century. In addition to private donors, companies, associations, and local authorities are also increasingly active as founders.


Geographic distribution

Stiftungen are a civil law construct, found mostly in
German German(s) may refer to: * Germany (of or related to) **Germania (historical use) * Germans, citizens of Germany, people of German ancestry, or native speakers of the German language ** For citizens of Germany, see also German nationality law **Ger ...
-speaking areas.
Civil law Civil law may refer to: * Civil law (common law), the part of law that concerns private citizens and legal persons * Civil law (legal system), or continental law, a legal system originating in continental Europe and based on Roman law ** Private la ...
stiftung foundations have developed in Austria,
Cyprus Cyprus ; tr, Kıbrıs (), officially the Republic of Cyprus,, , lit: Republic of Cyprus is an island country located south of the Anatolian Peninsula in the eastern Mediterranean Sea. Its continental position is disputed; while it is ...
, Italy,
Finland Finland ( fi, Suomi ; sv, Finland ), officially the Republic of Finland (; ), is a Nordic country in Northern Europe. It shares land borders with Sweden to the northwest, Norway to the north, and Russia to the east, with the Gulf of Bo ...
, Germany, the Netherlands (Stichting), Netherlands Antilles, Spain, Sweden (Stiftelse), Switzerland,
Panama Panama ( , ; es, link=no, Panamá ), officially the Republic of Panama ( es, República de Panamá), is a transcontinental country spanning the southern part of North America and the northern part of South America. It is bordered by Co ...
(1975), and more recently in
St Kitts Saint Kitts, officially the Saint Christopher Island, is an island in the West Indies. The west side of the island borders the Caribbean Sea, and the eastern coast faces the Atlantic Ocean. Saint Kitts and the neighbouring island of Nevis cons ...
(2003),
Nevis Nevis is a small island in the Caribbean Sea that forms part of the inner arc of the Leeward Islands chain of the West Indies. Nevis and the neighbouring island of Saint Kitts constitute one country: the Saint Kitts and Nevis, Federation ...
(2004),
Bahamas The Bahamas (), officially the Commonwealth of The Bahamas, is an island country within the Lucayan Archipelago of the West Indies in the North Atlantic. It takes up 97% of the Lucayan Archipelago's land area and is home to 88% of the archi ...
(2005),
Anguilla Anguilla ( ) is a British Overseas Territory in the Caribbean. It is one of the most northerly of the Leeward Islands in the Lesser Antilles, lying east of Puerto Rico and the Virgin Islands and directly north of Saint Martin. The territ ...
(2006),
Antigua Antigua ( ), also known as Waladli or Wadadli by the native population, is an island in the Lesser Antilles. It is one of the Leeward Islands in the Caribbean region and the main island of the country of Antigua and Barbuda. Antigua and Ba ...
and
Barbuda Barbuda (), is an island located in the eastern Caribbean forming part of the sovereign state of Antigua and Barbuda. It is located north of the island of Antigua and is part of the Leeward Islands of the West Indies. The island is a popula ...
(2006),
Malta Malta ( , , ), officially the Republic of Malta ( mt, Repubblika ta' Malta ), is an island country in the Mediterranean Sea. It consists of an archipelago, between Italy and Libya, and is often considered a part of Southern Europe. It lies ...
(2006),
Jersey Jersey ( , ; nrf, Jèrri, label=Jèrriais ), officially the Bailiwick of Jersey (french: Bailliage de Jersey, links=no; Jèrriais: ), is an island country and self-governing Crown Dependencies, Crown Dependency near the coast of north-west F ...
(2009), and
Labuan Labuan (), officially the Federal Territory of Labuan ( ms, Wilayah Persekutuan Labuan), is a Federal Territory of Malaysia. Its territory includes and six smaller islands, off the coast of the state of Sabah in East Malaysia. Labuan's capi ...
, Malaysia (2010).


See also

* Non-profit foundation


References

{{reflist Corporate taxation Types of business entity Legal entities Ownership Holding companies Foundations