General Information Banking
Business Etiquette Tips Embassy Locations and Registration
Employment-Legal Requirements Entry and Exit Requirements
Intellectual Property Legal and Registration of a Business Entity
Safety and Crime Taxes

General Information

GermanyGermany is Europe's largest economy, its second-most populous nation, and a key member of the continent's economic, political, and defense organizations. In January 1999, Germany and 10 other EU countries introduced a common European exchange currency, the euro. Germany has been a prime destination for political and economic refugees from many developing countries in addition to possessing a large Turkish population. The country represents significant diversity and cultural variations throughout its many states.

Germany continues to emphasize close ties with the United States, membership in NATO, and the "deepening" of integration among current members of the European Union. The Federal Republic of Germany took part in all of the joint postwar efforts aimed at closer political, economic, and defense cooperation among the countries of Western Europe. Germany has been a large net contributor to the EU budget. It also is a strong supporter of the United Nations and of the Organization for Security and Cooperation in Europe.

Major Cities
Capital: Berlin (population about 3.4 million)
Major cities:  Hamburg, Munich, Cologne, Frankfurt, Essen, Dortmund, Stuttgart, Dusseldorf, Bremen, and Hanover
Official Currency
euro (EUR)
Time Zone
UTC+1 (6 hours ahead of Washington, D.C. during Standard Time). Daylight Saving Time: +1 hour (begins last Sunday in March, ends last Sunday in October).

Legal System and Government

Type of Legal System

The German legal system is a civil law system with indigenous concepts and judicial review of legislative acts in the Federal Constitutional Court. it has not accepted compulsory International Court of Justice (ICJ) jurisdiction.

Form of Government

Federal republic



Available Banking Services

Credit cards
Banking in English
Online banking   
Overdraft protection

Bank Holidays

New Year's Day
Good Friday
Easter Monday
Ascension Day and Labor Day
Whit Monday (the day after Pentecost)
Germany Unity Day (October 3rd)
Christmas Eve and Day
2nd Day of Christmas
New Year's Eve

U.S. and Other Major Banks in Country

(Note: Address and contact information subject to change.)

Frankfurter Welle
Reuterweg 16
60323 Frankfurt +49-69-1366-0


Business Etiquette Tips

Business Attire

Business dress is understated, formal, and conservative. For men dark-colored, conservative business suits are the norm with similar attire for women, including conservative dresses. 

Business Negotiations

Germany is heavily regulated, very bureaucratic, and formal in its business dealings. Germans hold greater respect for academic credentials and the stability of a company over establishing personal relationships as a requirement to conducting business.  Great deference is given to people in authority, so it is essential that someone of senior authority be included in business negotiations. Expect a great deal of written communication, both to back up decisions and to maintain a record of decisions and discussions. 

Public and Social Behavior

Greetings are formal and generally include a quick, firm handshake. Use a person's title and their surname until invited to use their first name. You should say "Herr" or "Frau" and the person's title and their surname. When entering a room, shaking hands with everyone individually, including children, is expected. 

Scheduling Appointments

Appointments are mandatory and should be made one to two weeks in advance. If writing to schedule an appointment, it must be in German and should be addressed to the top person in the proper department. Punctuality is taken extremely seriously.


Embassy Locations and Registration

Americans living or traveling in Germany are encouraged to register with the nearest U.S. embassy or consulate through the State Department's travel registration Web site so that they can obtain updated information on travel and security within Germany. Americans without Internet access may register directly with the nearest U.S. embassy or consulate. By registering, American citizens make it easier for the embassy or consulate to contact them in case of emergency.

(Note: Address and contact information subject to change.)

German Embassy in Washington, D.C.
4645 Reservoir Road, NW
Washington D.C. 20007-1998
Phone: (202) 298-4000
Fax:     (202) 298-4249 or 333-2653

Embassy of the United States in Berlin
Pariser Platz 2
10117 Berlin
Federal Republic of Germany
Phone: (030) 2385 174 (calling within Germany)
Phone: 49-30-2385 174 (outside of Germany)


Employment-Legal Requirements

Part-time employees must be given treatment equal to that of full-time employees provided there are no legally justified reasons for unequal treatment. As a rule, the contract of employment is for an unlimited period. The duration of fixed-term contracts must be set based upon a specific end date, the completion of a specific task, or the occurrence of a specific event. An employee who is employed for a fixed term must be given treatment equal to that given full-time employees employed to do similar work.

Workers' daily work hours may not exceed eight hours. Such hours can be extended to 10 hours only if for a short duration of no longer than six calendar months. Additionally, at least 15 Sundays in the year must be free. Unlike many other countries, there is no statutory minimum wage in Germany.

Terminating Employees

Unions are more powerful and substantial in Germany than in the United States. Workers are protected by strong labor laws that provide them many different rights. About 28 percent of the workforce is organized into unions. The overwhelming majority of organized workers belong to eight unions largely grouped by industry or service sector and affiliated with the German Trade Union Federation, the country's main central trade union. Unions' right to strike and the employers' right to lockout are protected in the German constitution. 

In principle, employers and employees can terminate contracts of employment at any time by giving a four-week notice by the 15th or end of any month. The minimum statutory period is four weeks, and it is increased by one month each time the worker has completed his/her fifth, eighth, 10th, 12th, and 15th year of employment with the same employer. The maximum entitlement is seven months after the worker has completed 20 years of service. Notice must be given in writing in order to be considered legal.

The Act on Protection Against Cancellation, however, provides for longer minimum notice periods for long-serving employees. In some cases, this is extended even further (unless there is compensation in lieu) if it would cause grave social hardship to an individual for him to be declared redundant. Certain persons, such as expectant mothers, the disabled, and members of the workers' council or employee representatives on the supervisory board, enjoy more or less absolute protection against redundancy. All planned redundancies must be discussed with the workers' council, and isolated instances apart, agreement must be reached with them in the form of a so-called "social plan" to alleviate hardship.

Legally Mandated Benefits and Leave


Annual Leave Minimum of 24 days: 100 percent pay (including Saturdays)
Child-Raising Leave Upon completion of maternity leave, up to 4 years of unpaid leave may be granted to male or female employees to permit time to raise a young child to 4 years of age. Job protection is provided.
Maternity Leave 6 weeks prior to the birth and 8 weeks following the birth (paid out of a statutory health insurance fund and an employer supplement.) In cases of premature or multiple births, 12 weeks following birth is provided.
Sick Leave Up to 6 weeks upon completion of 4 weeks employment: 100 percent pay



Entry and Exit Requirements

A passport is required. U.S. citizens can stay without a visa for a tourist/business stay of up to 90 days. The 90-day period begins when entering any of the Schengen countries: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Italy, Luxembourg, Malta, the Netherlands, Norway, Portugal, Spain, and Sweden. Citizens of the United States may apply for their residence permit for work purposes after entering Germany without a visa.

Work permits are initially granted annually. Renewal periods then usually match the residence permit. They will not be granted if the local labor authorities feel that the position could be filled by an out-of-work German or EU citizen. But renewal will not normally be refused. There are various exceptions to this general system, one of which concerns the "green cards" previously granted to particularly well-qualified individuals in the IT industry. Holders of a green card should check limitations on how long they may remain in the country, which may be affected by the card holder's annual salary.

The required documents to obtain a work permit are:


Intellectual Property

Intellectual property is well protected by German laws. Germany is a member of the World Intellectual Property Organization  (WIPO) and a party to the major international intellectual property protection agreements: the Bern Convention for the Protection of Literary and Artistic Works, the Paris Convention for the Protection of Industrial Property, the Universal Copyright Convention, the Geneva Phonograms Convention, the Patent Cooperation Treaty, the Brussels Satellite Convention, and the Treaty of Rome on Neighboring Rights.

German Patent and Trade Mark Office
Zweibrückenstraße 12
D-80331 Munich
Title of head: President
Phone: (49.89)
Fax:     (49.89)

Nature of Rights and Available Protection

The overall patenting procedure typically takes 24 to 30 months on average, though with the payment of higher fees the process can be shortened to as few as 12 months. This is not typical, however. It also takes into consideration that the examination request has been filed within the initial four months from the filing date and the examination fee has been paid.


Design protection of a new and novel design can last for 25 years from the filing date following entry into the Designs Register. The registered design protects the design of three-dimensional objects, for example furniture, cars, or toys. Two-dimensional patterns, such as textiles, wallpapers, logos, graphical images, or icons can also be registered.  Registration provides the originator exclusive right to use the design.


The maximum standard term of protection for a patent is 20 years with payment of annual fees from the third year onward on an annual basis, which is required to preserve patent rights. This time frame is retroactive to the date of the initial filing. Nonresidents receive the same rights when registering for patents as residents, but local, legal representation is required. 

Inventions will only be patented after extensive research and review of the claims, description, drawings, and procedures has been conducted. The exclusive right of use and the right to prevent others from using the invention come into effect with the grant of the patent. Note that special provisions apply to inventions in the field of pharmaceuticals and plant protection products that can extend protection for up to five years beyond the maximum term of the patent.

When applying for patent protection in one or more of the European states, the applicant also has a choice of streamlining the process and applying for protection in all European countries simultaneously or selecting one specific country. 

Utility Patents

Utility model protection can last for up to 10 years. Utility model registration provides fast and low-cost protection for technical inventions, chemical substances, food, and pharmaceuticals, but not for processes such as manufacturing, working, or measuring processes.

The benefits are that a utility model may be registered within a few weeks after filing the application. It is considered a fast way to get a fully fledged, enforceable intellectual property right. But there is no automatic international protection, and not all countries may offer protection individually. The protection period is 10 years versus 20 and the substantive requirements for protection such as novelty, inventive achievement, and industrial application are not examined in a utility patent. The initial term of protection is three years. Protection can be renewed after three, six, and eight years by paying the appropriate maintenance fee.


Trademark protection is valid for 10 years once registered, and it can be extended for another 10 years. Registration of a trademark confers to its owner the exclusive right to use the trademark in relation to the protected goods and/or services. Trademark owners have the exclusive right to use, sell, or even assign their trademarks (through the use of a trademark license). Trademark protection covers any combination of words, letters, numbers, pictures, colors, and sounds. If proven, trademark protection can also protect the usage of consistently used combinations of words, letters, colors, and so forth for an extended period of time.


Intellectual property is well protected by German laws. The patent courts are set up to include legal judges, patent attorneys, and technical experts on the bench that help ensure receipt of sound legal decisions. 

Any person may give notice of opposition against a patent once published, within three months of the publication, by stating their reasons against the grant of the patent that were not made available during the examination. The invention will then be re-examined by an examination panel with the determination made either to revoke or maintain the patent as granted or in an amended form. If revoked, the patent owner may appeal against the decision, and the case will be further dealt with by the Federal Patent Court (Bundespatentgericht). Likewise, if the patent is maintained as granted or in an amended form, the opponent may file an appeal to the Federal Patent Court. If the opposition period has expired or opposition proceedings are no longer pending, a nullity action may be brought before the Federal Patent Court. 

National treatment is also granted to foreign copyright holders, including remuneration for private recordings. Under the TRIPS (Trade-Related Aspects of Intellectual Property)  Agreement, the federal government also grants legal protection for practicing U.S. artists against the commercial distribution of unauthorized live recordings in Germany. Germany has signed the WIPO Internet treaties and ratified them in 2003. Foreign and German rights holders, however, remain critical of provisions in the German Copyright Act that allow exceptions for private copies of copyrighted works. Most rights holder organizations regard German authorities' enforcement of intellectual property protections as comprehensive, though problems persist because of the difficulty of combating piracy of copyrighted works on the Internet.


Legal and Registration of a Business Entity

Foreign businesses may establish their German operations as companies, partnerships, or branches of the parent entity. It is also possible to establish an informal presence through a liaison or contact office or by merely recruiting an individual to live and work in Germany as a direct employee of the parent company.

A foreign business may carry on operations in Germany through a branch registered for that purpose, but it is not necessary to register a branch if it is considered a dependent entity, lacking in its own identity. If it is to be an independent branch, however, it must be entered at the Commercial Registrar.  Tax treatment is the same for either designation.  Foreign and domestic entities have the right to establish and own business enterprises and acquire and dispose of interests in business enterprises.

Registration Formalities (Including Timing)

The World Bank estimates that it will take 11 days and nine steps to register a company in Germany.

The streamlined procedures are presented here and include:

  1.  Clear the name of company at the local chamber of industry and commerce.
  2.  A notary notarizes the articles of association and memorandum of association.
  3.  Open a bank account.
  4. Notary public files the articles of association with the local commercial register, kept at local courts.
  5. Notify the local office of business and standards of the establishment of the company.
  6. *Register with the professional association of the relevant trade.
  7. *Notify the local labor office of the establishment of the company.
  8. *Register employees for health and social insurance.
  9. *Mail out the documentation to the Tax Office.

*Takes place simultaneously with another procedure.  

(Source:  The World Bank, Doing Business - Germany)

An additional resource in locating and determining the proper legal forms, tax structure, and general guidance that may further assist in establishing an office is the business registration division of Germany's Trade and Investment Office.


Safety and Crime

German authorities remain vigilant in combating threats posed by foreign extremists. Like other countries in the area, Germany's open borders with its European neighbors allow the possibility of dangerous individuals entering and exiting the country with anonymity. Germany regularly experiences demonstrations on a variety of political and economic themes. On occasion, Americans have reported that they were assaulted for racial reasons or because they appeared "foreign." All Americans are cautioned to avoid areas around protests and demonstrations and to check local media for updates on the situation.

Violent crime is rare in Germany, but in larger cities or high-risk areas such as train stations attacks have been noted. Most incidents of street crime consist of theft of unattended items and pick-pocketing, and there are reports of aggravated assault against U.S. citizens in higher-risk areas. American travelers are advised to take the same precautions against becoming crime victims as they would in any American city.



A foreign national who intends to work in Germany for a resident or nonresident employer generally needs a residence permit and a working permit. Before entering Germany, a foreign national from outside the European Union must obtain a prior residence permit (Aufenthaltsgenehmigung) in the form of a visa from an official representative of the Federal Republic of Germany in his home country if he or she intends to stay more than three months or to take up paid work. In addition to a residence permit, foreign nationals from outside the European Union who are not self-employed and intend to work in Germany need a work permit. A work permit is issued by the local employment authority for the geographical area where the job is located.

Individual income tax is imposed at progressive tax rates depending on the amount of taxable income. 

Individual and Employee Taxation

Determining Tax Residence

An individual present in Germany for a period of 183 days or more is considered a resident and is subject to German tax laws. Homeownership and other activities that suggest a permanent presence also trigger resident status. Typically departing Germany ends any tax status determined, but taxation of any income from Germany may continue even for nonresidents. 

Foreign employees are subject to the same social security regulations as German employees. There is no insurance obligation for a stay of less than three months or for certain part-time employment. Within the European Union, however, employees may remain in their national social security system if certain requirements of European law are fulfilled. Nonresidents are typically taxed on all income originating from Germany unless it is exempt per a tax treaty. Germany and the United States have a double-taxation treaty in place. 

Resident Employees

In general, all employees working in Germany are subject to mandatory social insurance regardless of their citizenship or the residence of the employer. There is an exception for employees temporarily delegated by a foreign employer to a German branch that exempts them from German social security payments.

Residents are responsible for paying tax on all worldwide income unless a tax treaty has been established with the country in question. German residents are taxed on all income (domestic and foreign), though each resident is also entitled to personal exemptions and deductions based upon their personal circumstances on a case-by-case basis. 

Employee Taxes

The tax year for income tax purposes is the calendar year. The tax liability of an individual depends solely on his residence. Citizenship is not a relevant factor.  According to the concept of unlimited liability to tax, individuals resident in Germany are subject to income tax on their worldwide income. The status of unlimited liability to tax is also relevant for various tax allowances and filing options (e.g., joint returns for married people, child benefit payments, and child allowances). 

The German social security system is broken down into four main and a number of minor elements. The main components are retirement insurance, unemployment insurance, invalidity insurance (e.g., disability), and health insurance. The cost is generally split equally between employer and employee. The monthly health insurance premium varies by insurer.

With certain specific exceptions, the first three of these insurances are compulsory. The health insurance is voluntary for those regularly earning more than a base monthly amount set by the government. But those opting out of the state-regulated health insurance do so once and for all. That is, they have very little possibility of rejoining later unless their regular monthly earnings fall below the opt-out level while they are still under 55.

Corporate and Employer Tax Obligations

Every business operating in Germany is subjected to a trade tax on income (Gewerbesteuer). This also includes foreign-owned business operations. Further, corporations, partnerships, and individuals are required to withhold and remit taxes for the wage taxes (Lohnsteuer) and payments to foreigners determined by whether or not a double-taxation treaty exists.

Nonresident corporations are subject to taxation on income from sources in Germany (limited tax liability). A corporation is considered resident in Germany if it maintains either its seat or its central place of management in Germany. The central place of management is where key decisions are regularly made. Otherwise, a corporation is considered nonresident.  In general, taxable income is calculated on the profit of the operating business under German GAAP with certain add-backs and/or deductions. The main adjustment item is the financing cost deduction (Zinsschranke).

Germany also employs a standard value-added tax (VAT) rate for supplies of goods or services taking place within the country. Certain goods and services (e.g., books, newspapers, and food) may be subjected to a reduced VAT rate.


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