Starting a Business
Find out about the various business structures in Germany and how to get a venture started...
Starting a business in Germany is relatively straightforward. While there are formalities to follow, the basic procedures and regulations of starting a business in Germany do not significantly differ from those in English-speaking countries. German law makes no distinction between German nationals and foreigners when it comes to establishing companies in Germany. There are also no restrictions on the repatriation of profits. Much like in English-speaking countries, German law distinguishes between limited companies, joint stock companies (similar to a public limited company), and other forms of partnerships.
It is important to understand the different types of business structure allowed by German law, the rules for residents versus non-residents, as well as the legal process for starting a business in Germany.
- The German government's business start-up portal provides comprehensive information in English on starting a business
Types of Business Structure
- GmbH (Gessellschaft mit beschrankter Haftung), or a limited liability company, is the most common form of company in Germany. This is the equivalent to a Limited Company, or Ltd. The minimum share capital (Stammkapital/Grundkapital) is €25,000
- AG (Aktiengesellschaft) is a joint stock company. This is the equivalent of a Public Limited Company or PLC. Five members and a minimum starting capital of €50,000 are required
- GbR (Gesellschaft bürgerlichen Rechts) is a flexible company model, which can be either a one-person business or based on a contract agreed upon by two or more persons
- Zweigniederlassung (or subsidiary) is a German branch of a company which is registered in a foreign country. The Zweigniederlassung must be commercially registered in Germany as a subsidiary. The parent company assumes liability for this subsidiary, therefore there is no minimum equity
- OHG (Offene Handelsgesellschaft) is a simple company model in which the partners involved have unlimited liability and are obligated to operate the business depending on the terms of the contract
Government Assistance in Setting up a Business in Germany
The German Ministry for Economy and Technology (Bundesministerium für Wirtschaft und Technologie) offers an English language online service for foreigners wishing to start a business in Germany. This step-by-step portal lists start-up procedures, business planning strategies and management techniques to ensure the company is successful.
State aid can also be applied for, although previous employment in the country is required for at least a year to be eligible for assistance.
- For further information from the Ministry: Click here
Christian Regnery, Rechtsanwalt
Torstr. 49/Ecke Schönhauser Allee, D-10119 Berlin
Tel: 030 4404 2733, Fax: 030 4404 2777, www.regnery.de