Company Formation in Germany for Foreigners

EU/EEA vs non-EU: which rules apply to you

The formation process is broadly the same for everyone, but the residence side differs sharply depending on your nationality.

EU and EEA nationals enjoy freedom of establishment. They may pursue self-employment or provide services in Germany under the same conditions as Germans, with no separate work or residence permit (make-it-in-germany.com; EU law). If you hold an EU or EEA passport, the residence question essentially does not arise, and you can move straight to the practical steps of formation, including how to open a GmbH as a foreigner.

Non-EU and third-country nationals are in a different position only if they want to relocate to Germany and run the business themselves. In that case they generally need a residence permit for self-employment under §21 AufenthG. The full pathway, including the statutory conditions and the practical friction, is covered on our dedicated page for non-EU founders and the §21 self-employment visa. If you simply want to own and direct a German company from outside Germany, the §21 question does not apply to you at all.

Do you need a visa to own or run a German company?

This is the myth worth killing outright: owning shares in, or being the managing director of, a German company does not require a visa. There is no residency requirement attached to either role (gtai.de). A residence permit under §21 AufenthG only becomes relevant when a non-EU founder physically relocates to Germany to run the business on the ground.

For that relocation case, §21(1) AufenthG sets three conditions: that "ein wirtschaftliches Interesse oder ein regionales Bedürfnis besteht" (an economic interest or regional need exists); that the activity is expected to have "positive Auswirkungen auf die Wirtschaft" (positive effects on the economy); and that financing is "durch Eigenkapital oder durch eine Kreditzusage gesichert" (secured by own capital or a loan commitment). Under §21(3), applicants over 45 should be granted the permit only with "angemessene Altersversorgung" (adequate old-age pension provision). As a procedural convenience, nationals of Australia, Canada, Israel, Japan, New Zealand, South Korea, the UK and the USA may enter Germany visa-free and apply for the self-employment permit from within Germany.

That is the short version. For the full §21 pathway and the non-EU friction stack, see the non-EU founders' guide. The key point to carry away: managing your German company from abroad needs no permit; only on-site relocation does.

Documents a foreign founder needs

What you have to produce depends on whether the founders and shareholders are individuals or a foreign company.

Individual foreign founders. You need a valid passport or ID for each shareholder and each managing director, plus the German business or registered address for the company (gtai.de). That is the core set for a straightforward formation by private individuals.

A corporate (foreign-company) shareholder. Where a foreign company will hold the shares, the notary "will ask for documentation verifying the existence of any parent company as well as the power of representation for persons acting on behalf of it" (gtai.de). In practice this generally means an excerpt from the foreign commercial register together with the articles of association of the foreign parent company, plus proof of who is authorised to sign on its behalf.

Apostille or legalisation, plus a certified translation. Foreign public and corporate documents typically need either an apostille (for documents issued in Hague Convention states) or full legalisation (for documents from non-Convention states), and then a certified German translation by a sworn translator. Which route applies depends on the issuing country, so it is not safe to assume an apostille will always do; the heavier document load falls on corporate foreign shareholders.

Notarisation: in person, online, or by power of attorney

A notary is not optional for a GmbH. As gtai.de puts it, "the involvement of a German notary is required for the incorporation of a GmbH": the articles must be notarised, and the notary files the registration electronically with the Handelsregister. The question for a foreign founder is not whether a notary is involved, but whether you have to be physically present.

Since 1 August 2022, online video notarisation has been available, introduced by the DiRUG reform implementing EU Directive 2019/1151. As Covington & Burling note, "effective August 1, 2022 ... the German legislator has introduced the option to replace physical meetings." On paper that sounds like a fully remote route, but for many foreigners it runs into one specific limitation.

The eID trap. The notary must verify your identity using a recognised electronic proof of identity (an eID). The accepted forms are a German ID card, an eID card for non-German EU/EEA citizens, and electronic residence permits for third-country nationals. Critically, "a German passport ... does not meet these requirements, as it does not have the required electronic functions" (cov.com). The practical consequence is that a non-resident third-country national who holds only an ordinary passport, with no German electronic residence permit, cannot use the online procedure. Their real options are to appear at a German notary in person, or to sign a notarised and apostilled power of attorney abroad so that a representative can act for them in Germany (firma.de). The online procedure also began in 2022 as a cash-formation route only, with in-kind formations requiring a physical meeting; scope was later extended for non-cash formations under DiREG from 1 August 2023. In-person notarisation remains available and, for most non-resident foreigners, is the practical route. To proceed on the EU track, see how to open a GmbH as a foreigner.

Capital & the non-resident bank-account hurdle

For a GmbH, the share capital is €25,000, and "at the time of registration, at least half of the minimum capital (i.e. EUR 12,500) must be actually and verifiably contributed on a bank account" (gtai.de; §5(1) and §7(2) GmbHG). A UG can be founded from €1, fully paid in cash, with no contributions in kind (§5a GmbHG). The €25,000 is share capital, not a fee, and only €12,500 needs to be paid in before registration; the rest can follow.

The genuine friction for non-residents is not the capital figure but the bank account that has to hold it. For a GmbH or UG you must open a business account, deposit the share capital and obtain proof of payment before the Handelsregister entry can be made. That account sits squarely on the critical path: until it exists and the capital is in, the registration cannot complete. Traditional banks frequently require in-person identification and KYC, which can mean travelling to Germany. Some direct banks and fintechs (for example DKB or comdirect) accept non-residents via VideoIdent, although onboarding for an incorporated entity is more selective. The distinction matters in practice: VideoIdent "is available outside Germany," whereas PostIdent "can only be completed in Germany" at a Deutsche Post branch (firma.de). This is the step where realistic expectations save the most time; for the detail, see our guide to a business bank account for non-residents.

Your German business address

Every German company needs a German business or registered address, and a registered or virtual office address is commonly accepted to satisfy it (gtai.de). This is also where the phrase "local representative" comes in, and where it is easy to misread the requirement.

A "local representative" is not a residency requirement on the owner or director. gtai.de notes that the GmbH needs a German business address and a local representative; that is an operational and service point (somewhere mail and authorities can reach the company), not an obligation for you to live in Germany. You can satisfy the address and representation requirements without relocating. For options, see our German registered address services.

Do you need to speak German?

Notarial deeds and official filings are in German. The notary will involve a sworn interpreter or arrange a certified translation so that you can understand and validly execute the documents, and an English-speaking firm bridges the rest of the process for you, from correspondence with authorities to the practical registrations. You do not need fluent German to form the company, but you do need someone who can operate in German on your behalf.