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Company in Germany, Business in Germany

Germany has very liberal law, but at the same time it deters the entrepreneurs and sole traders from opening own companies. German clerks require adequate qualifications, considerable financial resources and business plan, which would authenticate the success of business.

Starting an activity requires placing an application in relevant municipality. Placing an application does not mean that one can start an activity – still a permit is necessary (transport services, travel agency, accommodation services, restaurants, trading with second hand wares) or entry into Craftsmen Chamber. According to German law, the construction workers are also craftsmen. It means, that even a small construction company needs entry in the Craftsmen Chamber.

If a particular activity does not require permit, after its registration one has to inform the Inland Revenue. It gives a company VAT ID number and send a form with questions about the planned income. Next number is given by the Labour Office.

Company’s registration is complicated and may last from six to nine months. It is advisable to use help of the legal advisors. They are not cheap, but they will fasten the establishment process.

The simplest way of starting an activity is making entry in the Trade Activity Register and obtaining so called Gewerbekarte. Foreigner must prove that he has enough financial resources to live in Germany.

That is why the most popular type of company is a limited liability company. It can be created by one person only, but the Founding Act must be notarized. After signing an agreement one has to open a bank account and pay at least 25 000 Euro of the stock capital. The name of a company can be chosen freely, but it must differ from other names. Decision about registration is issued by Trade Chamber.


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