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Company Set Up

Setting up a German market presence requires a legal structure. Expanding foreign companies generally opt to establish a local subsidiary or register a local branch office.

A subsidiary is an independent company established and predominantly held by another company (parent company). Foreign companies often choose the private limited liability company option (Gesellschaft mit beschränkter Haftung – GmbH) for local subsidiary formation. The main reason for the popularity of a subsidiary in the form of a GmbH is the separate limited liability, which this company form offers. 

A branch office forms part of the foreign head office company’s organization. There are two kinds of branch establishments: the autonomous and dependent branch office. These differ primarily due to the degree of independence from the head office company.

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