Foreign investors usually choose a GmbH, its low-capital variant the UG (haftungsbeschränkt), or a registered branch of the foreign company. A GmbH needs EUR 25,000 share capital and notarised articles, and comes into existence only on entry in the commercial register. Every German company must report its beneficial owners to the Transparency Register, and acquisitions by non-EU investors can be reviewed, with mandatory notification for listed sensitive sectors.
Choosing a vehicle: GmbH, UG or branch
The GmbH is the standard limited liability company for a German subsidiary. Its share capital must be at least EUR 25,000, but only part has to be paid before registration: at least a quarter of each cash share, and in total at least half of the minimum capital, counting contributions in kind. The UG (haftungsbeschränkt) is a GmbH formed with less than EUR 25,000. It must say so in its name, its capital must be fully paid in cash before filing, and a quarter of each year's profit must go into a statutory reserve until it is used for a capital increase or to cover losses.
A foreign company can instead register a branch (Zweigniederlassung). The branch is registered at the court where it is located, not where the head office is. Chamber guidance notes that a branch has no separate legal personality and no minimum capital, so the foreign parent bears its liabilities, and that a purely dependent establishment (Betriebsstätte) is not entered in the commercial register but must still be notified to the trade office.1234567
Notarisation and registration
GmbH articles of association must be notarised and signed by every shareholder. Notarisation can also take place by video communication using qualified electronic signatures, which allows founders abroad to incorporate without travelling. The notary then files the registration application electronically with the register court; the GmbH exists as a legal person only once it is entered in the commercial register.
Branch filings must be in German and notarially certified, with certified translations of foreign documents and an apostille or legalisation where signatures were certified abroad. Allow time for obtaining these documents from the parent's home jurisdiction. Once registered, the business must notify the competent local authority when it starts trading.891067
Transparency Register and beneficial owners
German companies and registered partnerships must identify their beneficial owners, keep that information current and report it electronically to the Transparency Register without delay. A beneficial owner is any individual who directly or indirectly holds more than 25 percent of the capital or voting rights or otherwise controls the company. Where no such person exists, the legal representative or managing director is treated as the beneficial owner.
For foreign-owned subsidiaries this means tracing the ownership chain above the German company, because indirect holdings through controlled entities count. Banks and other obliged parties will compare what you tell them with the register entry.1112
Foreign investment screening
The federal economics ministry may review acquisitions of German companies, or of separable business units or their essential assets, by acquirers from outside the EU where public order or security may be affected. Review thresholds are 10 percent of voting rights for the most sensitive sectors (such as critical infrastructure, critical software, certain telecoms and media), 20 percent for the other listed sectors and 25 percent for any other company.
For targets in the listed sectors, the acquirer must notify the ministry without delay after signing. Build the filing into the transaction timetable rather than treating it as a post-closing formality.13141516
| Option | Minimum capital | Liability | Registration | Points to note |
|---|---|---|---|---|
| GmbH | EUR 25,000; at least half (EUR 12,500) paid before filing | Limited to company assets | Notarised articles; commercial register at the company's seat | Standard subsidiary form |
| UG (haftungsbeschränkt) | Below EUR 25,000; paid in full in cash before filing | Limited to company assets | As for GmbH; name must include 'UG (haftungsbeschränkt)' | One quarter of annual profit to a statutory reserve |
| Branch (Zweigniederlassung) | None (chamber guidance) | Foreign parent (no separate legal personality) | Register court where the branch is located; filings in German, notarised | Certified translations and apostille for foreign documents |
| Dependent establishment (Betriebsstätte) | None | Foreign parent | Trade office notification; not in commercial register (chamber guidance) | Cannot trade under its own name |
How it works, step by step
- Agree the articles of association and have them notarised, in person or by video communication89German notary
- Pay in the cash contributions (at least a quarter of each share and EUR 12,500 in total for a GmbH; the full amount for a UG)2317Founders and bank
- Notary files the registration application electronically with the register court10Notary; local register court (Registergericht)
- Entry in the commercial register; the GmbH comes into existence10Register court
- Notify the start of business to the competent local authority (Gewerbeanzeige)7Local trade office
- Report beneficial owners to the Transparency Register11Transparency Register (registry authority)
No timings or fees are shown unless an official source states them.
Documents usually needed
- Notarised articles of association (or the statutory model protocol)
- Shareholder list with names, dates of birth, places of residence, nominal amounts and share numbers
- Managing directors' declaration that no disqualification applies
- Declaration that contributions have been paid and are at the managing directors' free disposal
- For a branch: certified extract from the foreign register with certified German translation and apostille or legalisation
- Beneficial ownership details covering the full ownership chain
Common mistakes
- Assuming that entry in the commercial register also satisfies the Transparency Register duty; an active electronic report of beneficial owners is required.
- Choosing a UG for a long-term operating subsidiary without planning for the compulsory profit reserve.
- Signing the acquisition of a company in a listed sensitive sector without notifying the economics ministry promptly after signing.
- Submitting foreign corporate documents for a branch without certified German translations or an apostille, which delays registration.
- Starting to trade before notifying the local trade office.
When the business crosses borders
- Indirect holdings through controlled entities count towards the 25 percent beneficial ownership test, so the parent group's structure must be disclosed.
- Non-EU acquirers face review thresholds of 10, 20 or 25 percent of voting rights depending on the target's sector.
- Documents certified outside Germany need an apostille (Hague Convention states) or legalisation for branch filings.
- A branch leaves liability with the foreign parent, which affects group risk allocation and may affect how counterparties and banks view the German business.
Questions businesses ask
Can we form a GmbH without travelling to Germany?
Yes. The articles can be notarised by video communication, with shareholders signing by qualified electronic signature. The notary then files the registration electronically.910
How much capital must be paid in before registration?
For a GmbH, at least a quarter of each cash share and at least EUR 12,500 in total, counting contributions in kind. A UG must pay its full capital in cash before filing.23
When does foreign investment screening apply?
When a non-EU acquirer reaches 10 percent of voting rights in the most sensitive listed sectors, 20 percent in other listed sectors or 25 percent in any other German company. For listed sectors, notification to the economics ministry is mandatory after signing.1415
What this guide does not yet confirm
These points need checking with a qualified local professional in Germany before you rely on them.
- Notary, register court and Transparency Register fees and typical registration times were not stated in the official sources reviewed.
- Whether managing directors must be resident in Germany or hold a particular residence status was not confirmed on an official page.
- Branch filing formalities rely on chamber guidance dated January 2022; confirm current practice with the notary.
- Screening review periods, the clearance certificate procedure and the current name of the competent ministry were not confirmed.
- Transparency Register fines, public access rules and discrepancy reporting were not reviewed.
Sources and review status
Each statement is numbered to the source it was checked against. We use official sources where we can, and each statement says whether it was checked against an official or a secondary source. Sources last checked on 18 October 2026. None of it has been professionally reviewed yet: it is research checked against official and secondary sources by WONE Global, not legal or tax advice.
A GmbH must have share capital of at least EUR 25,000. Gesellschaft mit beschränkter Haftung (GmbH); the UG (haftungsbeschränkt) variant may be formed with less (see de-establish-005).
A GmbH may be filed for registration only once at least a quarter of the nominal amount of each cash share has been paid in and total paid-in cash plus agreed contributions in kind reach half of the EUR 25,000 minimum capital. GmbH formation; contributions in kind must be fully delivered before filing (§ 7 Abs. 3). Does not apply to the UG, which must pay in full.
A company formed with share capital below the EUR 25,000 GmbH minimum must use the designation 'Unternehmergesellschaft (haftungsbeschränkt)' or 'UG (haftungsbeschränkt)', may be filed for registration only when its capital is fully paid in, and cannot use contributions in kind. UG (haftungsbeschränkt) under § 5a GmbHG.
A UG (haftungsbeschränkt) must allocate one quarter of its annual net profit, reduced by any loss carried forward, to a statutory reserve that may be used only for a capital increase from reserves or to offset losses. Applies to the annual financial statements of a UG (haftungsbeschränkt).
Filings and entries for a German branch of a company whose seat is abroad are made at the register court in whose district the branch is located. Branches (Zweigniederlassungen) of foreign legal entities and commercial companies.
Commercial register applications for a foreign company's branch must be made in German and notarially certified, with certified German translations of foreign-language documents and an apostille or legalisation for signatures certified abroad. Chamber guidance (status January 2022); also states that a branch has no separate legal personality and no minimum capital, and that a dependent establishment (Betriebsstätte) is not entered in the commercial register.
Secondary source: guidance from a public-law chamber of commerce, dated January 2022, used because the statutory filing-form rules could not be reached within the research window. Confirm current practice with the notary and register court.
Anyone starting an independent standing trade, a branch or a dependent branch office must notify the competent authority at the same time. Trade notification (Gewerbeanzeige) under the Trade Regulation Code; applies to subsidiaries, branches and dependent establishments.
The articles of association (Gesellschaftsvertrag) of a GmbH require notarial form and must be signed by all shareholders. GmbH and UG formation.
Notarial recording of GmbH articles of association may also be carried out by video communication, with qualified electronic signatures of the participating shareholders replacing handwritten signatures. Available where other form requirements do not prevent it; also available for the simplified procedure and the statutory model protocol.
The page did not state the date from which video formation became available; effective date left null.
A GmbH comes into existence and gains full legal capacity only on entry in the commercial register, and the registration application is filed electronically through a notary. GmbH and UG; the service description lists required documents including the articles, shareholder list, managing directors' declarations and a domestic business address. Fees depend on the work involved and are not stated.
Official federal service-catalogue entry contributed by a state administration; the legal requirements are federal.
Legal entities under private law and registered partnerships must obtain, keep up to date and report details of their beneficial owners electronically to the registry authority for the Transparency Register without delay. Applies to German companies (including GmbH and UG) and registered partnerships; certain foreign entities are also covered (see de-regulatory-003).
§ 20 Abs. 2 as displayed contains no notification fiction (Mitteilungsfiktion); an active report is required.
A beneficial owner of a company is any natural person who directly or indirectly holds more than 25 percent of the capital, controls more than 25 percent of the voting rights or exercises comparable control; if none can be identified, the legal representative or managing partner is deemed the beneficial owner. Companies other than registered foundations and listed companies subject to equivalent transparency rules.
The federal economics ministry may review whether the direct or indirect acquisition of a domestic company, or of a separable business unit or its essential operating assets, by a non-EU acquirer is likely to affect public order or security. Cross-sectoral review; acquirers from outside the EU (Unionsfremde).
The statutory text names the 'Bundesministerium für Wirtschaft und Klimaschutz'. Confirm the ministry's current name and contact point before filing.
Investment review is triggered when a non-EU acquirer reaches 10 percent of the voting rights in companies in the most sensitive listed sectors, 20 percent in the other listed sectors, and 25 percent in any other domestic company. 10%: companies listed in § 55a Abs. 1 Nr. 1–7 AWV; 20%: Nr. 8–27; 25%: all other domestic companies. Direct or indirect holdings after the acquisition.
A non-EU acquirer must notify the federal economics ministry without delay after signing a contract to acquire a domestic company in any of the sectors listed in § 55a Abs. 1 Nr. 1–27 AWV. Mandatory notification for sector-listed targets; for public takeover offers, notification follows publication of the decision to make the offer.
Sectors treated as most sensitive for investment screening include operators of critical facilities, makers of critical components and sector-specific software, certain telecoms and surveillance technology firms, large cloud providers, health telematics providers, influential media and providers of government communications infrastructure. § 55a Abs. 1 Nr. 1–7 AWV (10 percent review threshold); the list continues to Nr. 27 covering, among others, defence-related goods, artificial intelligence, quantum technology and pharmaceuticals.
The GmbH registration application must include a declaration by all applicants that the contributions have been made as required and are at the free disposal of the managing directors. GmbH and UG formation; in practice requires a bank account into which cash contributions are paid.
The statement that a bank account is needed in practice is an inference placed in scope, not stated by the source.
Questions on this topic
15 statements on entry, investment and company formation in Germany
