Business Immigration / Start-Up

Business immigration for investors, entrepreneurs & freelancers

Obtaining permission to work in Germany as an investor, entrepreneur or freelancer can be a complicated process and requires a profound working knowledge of different visa options available for you. Entrepreneurs / Investors / Freelancers from non-EU countries, who manage the company in Germany as self-employed persons, have the possibility to apply residence permit for their company management in Germany according to § 21 Residence Act.

Our legal firm focuses on assisting entrepreneurs, business owners and investors to attain their immigration goals. We help clients from all over the world in coming to Germany and establishing new businesses, acquiring existing businesses and making investments in a manner that enables our clients to obtain an applicable visa.

There are various types of Immigration by Investment visas you can apply for. We cover all different types, including International Startup Entrepreneurs, Turkish Citizenship by Investment and Golden Visa.

§ 21 Self-employment (Residence Act)

(1) A foreigner may be granted a residence permit for the purpose of self-employment, if

• an economic interest or a regional need applies,
• the activity is expected to have positive effects on the economy and
• personal capital on the part of the foreigner or a loan undertaking is available to realise the business idea.

The assessment of the conditions under sentence 1 depends in particular on the sustainability of the underlying business idea, the business experience of the foreigner, the amount of invested capital, the impact on employment and training situation and the contribution to innovation and research.

(2) … (4)

(5) In derogation from subsection (1), a foreigner (editor’s note: a freelancer) may be granted a temporary residence permit for the purpose of self-employment. A required permit to pursue such employment must have been issued or a confirmation must have been provided that such permit will be issued. Subsection (1) sentence 3 applies accordingly. Subsection (4) does not apply.

Who is a Freelancer?

An extensive definition of the liberal professions can be found in Section 1 (2) of PartGG. In accordance with that section, a freelancer is someone who provides services of a higher nature based on qualification, creative talent and professional independence. Typical freelancers are doctors, dentists, veterinarians, physiotherapists, psychologists, auditors, tax consultants, architects, pilots, journalists, interpreters, artists etc. Since the liberal professions are neither subject to trade regulations nor to trade taxes, the Income Tax Act (EStG) applies to them.

Applicants for a residence permit for freelance cannot get the permanent settlement permit earlier than 5 years in accordance with the § 9 Residence Act as the Subsection (4) of the § 21 Residence Act does not apply to them.

Regulations Regarding the so-called Startup Visa Pursuant to Section 21(2b) of the German Residence Act (AufenthG) / Start-Up Residence Permit

A foreigner may be granted a residence permit for the purpose of establishing a business if:

1. They are a qualified professional, and
2. They are granted a scholarship from a German economic organization or a German public body funded by public funds to secure their livelihood in preparation for the establishment of their business.

The residence permit is granted for a maximum of 18 months.

Establishing or Expanding your Business in Germany: The Business Plan

Is a business plan important?

Yes.

When applying for a business investment visa (§ 21 Residence Act), expanding or starting a business in Germany, a business plan can be crucial. This is especially the case with smaller businesses that have lower revenues or lower numbers of employees. New businesses are also entities for which foreigners Authority, Consular Officers and e.g. Chamber of Commerce expect a detailed business plan laying out the growth strategy of the firm in Germany.

The business plan is your opportunity to explain your business concept to the immigration authorities who will make a decision on your visa case. We believe part of our success rate with permit residence self-employed business visa is, in part, attributable to the time and focus we spend working with clients, understanding their business and formulating their business plans.

The residence permit for self-employed persons is limited, usually up to three years. If the investment project has been successful (and success and livelihood continue to be ensured), an (unlimited) settlement permit residence can be applied for after three years.

For the development of your entrepreneurial concept you can rely on our experience. We will create a customized concept based on your business idea and advise you throughout the process.

Germany well-known as the world’s startup center

As the second highest population of international migrants worldwide (the US rank first), with more than 16 million people having an immigration background (first and second generation, including mixed heritage and ethnic German repatriates and their descendants), of whom about seven million are foreign residents with no German citizenship, Germany is host of many international startups founded by international entrepreneurs which rate the excellent general conditions in Germany. Almost 10 % of those startup founders and 22 % of their employees come from non-German countries.

Germany has been considered as one of the most interesting places for investment worldwide. US investors in particular have their eye on the German startup scene, and the amounts being invested are rising fast. Recently, the trend for investing in Germany between Chinese as well as other Asian and entrepreneurs from the Middle East has been increasing. In 2015, just short of 3.1 billion euros were invested in German startups, almost five times as much as in 2013, and almost twice as much as in 2014.

Company Foundation by Foreigners

Any entrepreneur who wishes to start a business in Germany – irrespective of nationality or place of residence – has a right to realize his or her business idea. There are generally no limiting restrictions in establishment of new companies for non-German nationals and no specific legislation for foreign entrepreneurs.

The formalities and the required documents and preconditions for establishing the new business in Germany varies depending on the form of the company and the appropriate legal form for each individual business to enter in the official register.

The GmbH is the most common legal form for business operation in Germany (private limited liability company). It combines flexibility with relatively few obligations and is limited to the assets of the GmbH. Another legal form which is foreseen in Germany is AG – German stock corporation which is intended for large companies with large number of shareholders.

For more information about the conditions and formalities get in touch with our authorized German lawyers to help you in the registration procedure and to receive customized service for your business, liabilities of shareholders, terms of taxation and other regulations.

Entry and Residence

There are different kinds of residence permits available for Germany:

• Visa (national and Schengen)
• Temporary residence permit
• Permanent settlement permit

A visa grants the holder to stay in Germany for up to 90 days in a 180-day period. Temporary and permanent settlement permits enable the holder to stay in Germany and work in Germany for a long period. The relevant residence permit depends on the specific area of business activity of the applicant who intends to reside in Germany.

A Schengen business visa is very convenient for performing activities related to fundamental company establishment phase and include activities related to notarization of association articles; registration in the commercial register; trade office registration; opening of a bank account etc.

Who needs a Residence permit?

• EU citizens and citizens of Iceland, Norway and Liechtenstein do not need any residence permits to be able to reside and work in Germany.
• Non-EU citizens require a Schengen visa for a short-term stay (except countries which fall under the category of “Best friends” – the USA, Canada, Japan, Brazil, Australia, Argentina, Israel to name a few; who can stay in Germany for up to 90 days in any 180-day period without a visa) and temporary / permanent settlement permit for a long-term stay.

In case of long-term stay, the responsible local German Embassy initiates the visa procedure and within a few weeks issues a national German visa to enable the person to enter Germany. After he / she enters Germany, the national visa has to be converted into a temporary residence permit by local responsible immigration authority (in German: Ausländerbehörde). Exceptions are foreseen for citizens from aforementioned “Best friends” countries: these nationals can directly apply for the necessary temporary residence permit at the local responsible immigration authority in Germany without having a national German visa.

In case you have decided to start your own business in Germany, get in touch with us to find out more.

Consulting is more than giving advice!

We will be with you from start to finish, during the entire process and help you path your way to Germany.