Company formation in Germany: Establishing a limited liability company online

In August 2022 it became possible to obtain an online appointment with a notary to establish a limited liability company (in German: GmbH). For foreign companies, for example from China, this brings numerous advantages. The Ecovis experts know how online formation works in Germany.

EU directive 2019/1151 obliges Member States to make online company formation possible. Germany has now complied with this directive.

Why online?

The most obvious advantage is that there is no need to be present. There are therefore no travel costs and the process can be altogether more convenient. It saves time and money. In particular, foreign investors no longer need to enter the country. This is of great benefit to Chinese entrepreneurs, for example, due to the current political and pandemic restrictions. However, a German bank account is still required.

The disadvantages of online company formation

There are restrictions during the establishment process if it is handled online. With online foundation, it is not possible to deposit share capital by providing material assets. However, in practice, this does not play a major role. Only registered merchants (eingetragene Kaufleute) and limited liability companies can be established online. Furthermore, there is no major time saving with online foundations for foreign shareholders, as opening a bank account can still take some time. There is a charge of EUR 25 for online appointments.

We have many years of experience and would be happy to support you in founding a company in Germany.

Richard Hoffmann, Lawyer, Ecovis Heidelberg, Germany

How does the process work?

The notarisation process is carried out by video conference. Only the notary association’s video communication system (for transmitting legal documents) is allowed here. The identity of the parties is verified using the identity card eID-function. The notary still carries out his/her essential duties, such as checking the capacity of the contract, reading out the wording of the contract, as well as his duty of checking the contract and instructing the parties. Sample transcripts can be used, but these do not reduce the costs of foundation. Representation by power of attorney is still possible. However, the notary can refuse the notarisation if he/she cannot verify the identity of the parties.

Online limitations

Currently, only limited liability companies can be established online. Increasing capital and other corporate actions outside the foundation process are not possible. The same applies to shareholder meetings and resolutions. However, in future more will be possible. Establishing a limited liability company with material assets, changing the articles of association as well as the foundation of non-commercial associations are planned to become available by 1 August 2023. Other contracts requiring notarisation, e.g. in the areas of family law and the law of succession will most likely still require attendance in person.

For further information please contact:

Richard Hoffmann, Lawyer, Ecovis Heidelberg, Germany
Email: richard.hoffmann@ecovis.com