Posted by: Susanne Hermsen: German Desk

If a Dutch entrepreneur wishes to enter the German market, he can set up a GmbH. The GmbH (Gesellschaft mit beschränkter Haftung) is the most popular legal form in Germany and is similar to the Dutch private limited company (besloten vennootschap, BV).

A German address is required in order to be able to set up a GmbH, and a German civil-law notary must draft the articles of association.

The following is some of the information that is required for setting up a GmbH:

• The incorporator’s details;
• City/town of registered office according to the articles of association;
• Name and address of the company to be incorporated;

The GmbH must have an office address in Germany.

• Object of the company to be incorporated;
• Subscribed capital of the company;

For a ‘normal’ GmbH, this subscribed capital (‘Stammkapital’) must be at least EUR 25,000. It is also possible to set up a so-called ‘Unternehmergesellschaft’, which requires a minimum capital of EUR 1.

• Director, executive directors and shareholder of the company to be incorporated.
• The shareholders can be both legal entities and natural persons. The GmbH is represented by one or more ‘Geschäftsführer’. The Geschäftsführer can only be a natural person.

As soon as all the information has been received, a draft deed incorporating the GmbH (‘Gründungsprotokoll’) and draft articles of association (‘Gesellschaftssatzung’) are drawn up. After the draft deed and draft articles of association have been checked and amended if necessary, an appointment is made with the civil-law notary for the deeds to be signed.

Once the incorporation has taken place, the subscribed capital (‘Stammkapital’) must be paid. An important point here is that the money must be paid after incorporation, but before registration in the commercial register. As soon as the GmbH has been registered, the money may once again be taken out to be used for business purposes.

Only once the deed of incorporation has been signed and the ‘Stammkapital’ has been made available is the GmbH reported to the German commercial register. The processing time depends on the location and workload of the particular commercial register.