German branch (permanent establishment)
Foreign enterprises can establish a branch (Zweigniederlassung) to carry out business in Germany. The branch has to be registered with the Commercial Register in the town in which it has its seat and has to notify the local district administration when starting business operations. Certain types of business operation may require prove of proper qualification.
Upon registration of a branch evidence must be provided of the legal existence of the head office, certified copies of the articles of incorporation, the names of all managing directors, the amount of share capital, the seat of the company, its organisation and the names of the person(s) that will act for it in Germany.
The branch is the easiest way for a foreign enterprise to set up business in Germany. Its main drawbacks however, are that the foreign parent carries full liability for the branch's operations and that it could entail lengthy and cumbersome dealings with the tax authorities over the branch's tax assessments and liabilities.
To get more information about permanent establishment, contact us via email to email@example.com.