Germany company registration
26 March, 2014
For many decades, Germany has been the economic nucleus of the EU. This economic success is due to the 'Mittlestand' (SMEs). These firms form the backbone of the German economy. Doing business in Germany has the following advantages:
1. Germany is the UE's most populous country and has a high per capita income (US$42,000). Consequently, a Germany resident company will benefit from the massive consumer demand for foreign goods/services that exists in the country.
2. Germany is the top choice for product distribution within EU because it has the world's 3rd highest rated infrastructure. High quality airports, rail and road services facilitate easy transfer of goods.
3. Germany has EUs most skilled labour with i) the largest labour force in Europe ii) 99% literacy rate iii) 99% computer literacy rate iv) 80% with formal job training v) third highest weekly employee work hours in the EU and vi) population with most degrees.
4. A Germany resident company only requires special licenses for highly specialized fields like insurance and medicine.
5. 'Made in Germany' is a globally renowned trademark, foreign entrepreneurs benefit greatly from business will get exposure to 10 million attending customers annually.
6. Germany has signed double taxation agreements with over 90 different countries to minimize withholding tax on payments abroad.
7. Germany company incorporation requires only one director and shareholder; they are not obligated to be residents or citizens of Germany.
8. There are no capital or exchange controls to discourage Germany investment. Foreign firms can transfer funds from abroad and convert them into Euro at no cost.
9. Germany is 2nd best in the world for registering Intellectual Property. It is a signatory to WTOs Agreement (TRIPS) which protects against IP rights violations.
Foreigners who are planning to invest in Germany, the following compliance regulations should be considered:
1. Germany legal system is efficient in resolving business disputes. The court's decision is binding on all parties, but appeals can be made to a Higher Court.
2. Germany law requires all resident firms to provide mandatory occupational accident insurance.
3. German Federal Data Protection Act bars firms from publically discolouring private information about an individual.
4. German General Equal Treatment Law bars discrimination against employees on the grounds of religion, race, gender and sexual orientation.
5. A Germany resident firm must file annual tax returns by 31st of May, penalties of up to 25,000 can be imposed for late filing.
6. A resident company must notify the Central Bank if a money transfer of more than 12,500 is made abroad, this is not an exchange control. It is done for statistical purposes.
Being the 13th least corrupted country in the world, Germany company formation can depend on the law to resolve all business disputes legitimately. Last but not least, Germany is a metropolitan country which is highly accepting of foreign workers. People with religious convictions are offered protection of the law and so, won't have to forsake their traditional roots.
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