Establishing a Limited Company (GmbH) in Germany
Today, many Turkish investors are establishing limited companies in Germany to sell products manufactured in Turkey in the European market, within their own means. This aims to facilitate access to domestically produced products into the European market, eliminate fees and commissions paid to intermediary firms, and generate higher profits.
Thanks to its economic strength and industrial status, Germany stands out as a top investment destination among European Union ("Union") countries.
In addition to facilitating commercial transactions through company establishment, company officials obtain a residence permit in Germany, granting them the right to free movement and trade within the EU. Furthermore, investors can even apply for citizenship upon completion of their five-year residence permit, provided all other requirements are met.
1. Required Procedures
First, the partners and the company representative of the company to be established in Germany must have a residence permit or business visa. To do this, individuals must apply for a residence permit at the German Consulate in their place of residence before traveling to Germany. The residence permit must be specific to the investor. Individuals wishing to invest in Germany are granted a residence permit under § 21 Aufenthaltsgesetz (Residence Permit Act).
A limited liability company in Germany requires a capital of €25,000 (twenty-five thousand). This amount includes the company's fixed assets and other investment expenses.
Once the company owner's residence permit procedures are complete, the business establishment phase begins. For this, you should contact the following institutions: i) the Chamber of Commerce, ii) the Chamber of Commerce, iii) the Tax Office, and iv) the Trade Registry Office.
First, the articles of association must be prepared and certified at a notary public in the location where the company will be established. A bank account must then be opened in the company's name, and the company capital must be deposited into this account.
Then, an application with the articles of association must be submitted to the competent court of peace in the location where the company will be established. The competent court will investigate whether there are any obstacles to the company's establishment. Once this process is complete, an application for business establishment must be submitted to the relevant commercial institution. The application fee is approximately €40. The Trade Office notifies the tax office, the court of peace, the chamber of commerce, and the social security institution that the application has been submitted. Upon application, the competent tax office will send the applicant the necessary documents for opening the business. The tax office will also provide the business's tax number.
If you plan to employ colleagues in your business, you must notify the Employment Office and register your business and obtain a business number. Furthermore, all employees must be insured.
After registering with the professional association and the tax office, the business must be registered with the chamber of commerce and the trade registry.
The business establishment process incurs a cost of approximately €1,000.
If you wish to market your products within the Union without being subject to income tax or to purchase products from other Union countries, you must obtain an income tax number. To do this, you must apply to the Federal Tax Center.
2. Conclusion
Our country's accession process to the Union is still ongoing. During this open-ended process, companies exporting to Europe face numerous expenses, such as customs duties, fees paid to intermediary companies, and commission fees. Manufacturers' profits are significantly reduced due to these expenses. Therefore, establishing a company in Germany appears very attractive, considering the following advantages: (i) reduced commercial transactions and bureaucracy, (ii) reduced customs fees and income taxes, and (iii) the possibility of obtaining a residence permit or citizenship. Turkish investors should consider investing in Germany with these considerations in mind.
Attorney Anıl Coşkun
info@anil-coskun.com
www.anil-coskun.com
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