Can a foreigner start a business in Germany?

Yes. Both EU and non-EU citizens can start businesses in Germany with appropriate legal documentation.

How long does the registration process take?

Typically, 4 to 6 weeks depending on the business type and documentation readiness.

What is the minimum capital required?

€25,000 for GmbH, though only €12,500 must be deposited initially.

Do I need to reside in Germany?

Not necessarily, but having a legal representative or business address in Germany is mandatory.

What is Germany’s immigration policy for entrepreneurs and business founders?

Germany supports international entrepreneurs through its §21 Residence Permit for self-employment. To qualify, applicants must present a viable business plan, demonstrate economic interest or regional demand, and have adequate financing to support their business and personal expenses.

Setting Up a Business in Germany: A Comprehensive Guide

Germany is one of the most attractive destinations for international entrepreneurs and investors, offering a stable economy, robust infrastructure, and access to the European Union market. Whether you're a start-up founder, SME, or multinational investor, setting up a business in Germany can open the doors to long-term growth.
Germany’s commitment to innovation, sustainability, and business transparency makes it a preferred hub for companies aiming to scale internationally. With an efficient regulatory system and access to advanced technologies, the country provides a fertile environment for entrepreneurs across industries from manufacturing to IT, life sciences, logistics, and beyond.

Key Steps to Start a Business in Germany

1. Choose the Right Business Structure

Options include sole proprietorship (Einzelunternehmen), GmbH registration in Germany (limited liability company), UG (mini-GmbH), or branch office.
Most foreign investors choose GmbH for its credibility and liability protection.

2. Register the Business Name

Ensure your company name is unique and complies with German naming laws.
Conduct a name check through the local Chamber of Commerce (IHK) as part of your business registration in Germany.

3. Draft Articles of Association

A legal document required for incorporation. It outlines company objectives, shareholder details, and internal governance.

4. Notarize Company Documents

All incorporation documents must be notarized by a German notary.The notary certifies the Articles of Association and the appointment of managing directors.
This step is crucial for legal validation and is required before submitting documents to the commercial register.

5. Open a Business Bank Account

Deposit the required share capital (minimum €25,000 for GmbH).
A German business bank account must be opened in the company’s name to transfer the capital. A certificate of deposit from the bank is required for further registration steps.

6. Register with the Commercial Register (Handelsregister)

Managed by the local district court; mandatory for most businesses.
The registration confirms the legal existence of your company. After submission, your company details become publicly available and officially recognized in Germany.

7. Tax and Trade Office Registration

The tax office issues a tax number and reviews your business activities to determine applicable tax obligations. Gewerbeamt registration is mandatory to begin operations and is typically completed at the local municipality.
Register with the local tax office (Finanzamt) to obtain a tax ID and VAT number. Also register your trade with the Gewerbeamt (Trade Office).

8. Social Security and Insurance Requirements

Mandatory registration for health, pension, unemployment, and accident insurance if hiring employees.
These registrations must be completed with the relevant statutory insurance providers before employees begin work. Employers are legally responsible for deducting and remitting social contributions on behalf of their staff.

9. Employment and Residency Permits (for Foreigners)

Non-EU entrepreneurs may need residence and work permits to operate in Germany.
The process includes demonstrating a viable business plan and proof of sufficient financial resources. Specific visa categories, such as the self-employment visa (§21 AufenthG) apply, and applications must be submitted through German embassies or consulates abroad. This is an essential part of Germany immigration for entrepreneurs.

Benefits of Setting Up a Business in Germany

Access to over 450 million EU consumers
Skilled workforce and innovation hubs
Transparent legal system
Strong support for R&D and manufacturing sectors
Reliable logistics and financial infrastructure

In addition, Germany is known for its bilateral trade agreements and international collaborations, making it easier for companies to expand beyond Europe. Government grants and subsidies are also available for businesses involved in technology, sustainability, and workforce development, offering long-term operational advantages. These benefits make setting up a business in Germany a smart move for international companies.

HIBS – Hannover International Business Services offers comprehensive support for foreign businesses planning to enter the German market. From business registration in Germany to legal consulting, GmbH registration Germany, and visa advisory, we ensure your business journey is smooth, compliant, and successful. Our experts guide you through each step of your Germany market entry strategy, ensuring fast, hassle-free setup and long-term support with the Hannover region as a base of operation.