There are many good arguments for setting up a company in the EU’s leading economy. However, bureaucratic challenges and institutional requirements may be tough for foreign nationals and require additional preparation.
The following list contains the main challenges that you will face when founding a company in Germany. The way you solve those issues will have important consequences for your future business in this country.
Choosing the right corporate form: German company law distinguishes between different company forms, such as limited liability companies, joint stock companies and different other forms of partnerships, among them unique “hybrids”. The best corporate form for you depends, among other things, on your individual circumstances, partners and long-term aims.
Writing the articles of association: despite rather banal information, such as the name, location and purpose of your business, the articles of association regulate extremely important legal aspects such as majorities, decision-making procedures and profit distribution. In order to avoid a future situation that could seriously damage the company, such as disputes between shareholders, it is extremely important to regulate as many aspects as possible in the company agreement.
Finding the company name: it may sound trivial, but the choice of the company name is not entirely up to you and your imagination. You need to communicate it apriori to the Chamber of Industry and Commerce and receive confirmation, that your name is admissible for your business.
Organizing translations: in order to make sure that you will not get disadvantaged at any point, it is highly recommended that you receive certified translations of all documents & agreements. As signing shareholder, it is necessary that a certified translator will accompany you to the notary appointment and you possess a certified translation of the articles of association in your native langue.
Getting in touch with a good notary: you need to find a capable notary in the administrative district where your company will be set up.
Opening corporate bank accounts: obviously, your business needs a corporate bank account. In the case of a limited liability company, the opening of the bank account and the deposit of the share capital is a necessary part of the company-founding process. Of course, the bank does have its own requirements and is not legally obligated to open an account for you.
Dealing with bureaucracy: your company is registered once it was recorded in the public register of companies. However, you now need to register your new company at the respective trade office and with the tax-authorities. You need to apply for a tax-number and a VAT-ID (if you plan to engage in international business operations). Additionally, prior to opening the company, authorities might require you to present a business plan.
Communicating with tax authorities: a highly complex topic that requires the involvement of an authorized and experienced specialist.
Renting office space: obviously, your business needs to be registered somewhere, possess the necessary means of communication, such as a telephone number, and a post address. Depending on your business and long term-aims, a temporary virtual office might be an adequate interim-solution. Normally, you will require a German speaking staff and an appropriate office space.
This list gives a very short overview of the different issues you will have to deal with when registering a company in Germany as a foreigner. Given the seriousness of those tasks and their potential consequences, we strongly advise that you invoke experienced specialists such as ourselves, that will take over the main tasks and guide you through the entire process.
Check out our business-services for more information on how we can help you. For an individual offer, pleasse get in touch with us!