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Starting a Business in Bavaria |
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 Like anything else, starting a successful business in Bavaria begins
with a good idea. Hundreds of companies have determined, backed by
marketing studies, to have an opportunity
in the German or European
market. Based on studies like these companies determine beforehand that
their products or services are positioned in terms of pricing, features
and other factors.
Some of these companies have been exporting their products and services
already into the German market and already have a solid knowledge base
about the market potential: In this case the decision is obvious!
Even then there are important aspects the Start-Up needs to take into
consideration and careful analysis needs to take place before you start
your successful business in Bavaria. Just be aware that you are in good
company: A growing number of foreign companies and entrepreneurs is
playing an active and important role in Bavaria’s economic life! A key
reason for this is the investor-friendly environment with liberal laws
for forming the various types of business structures.
Key decision here in terms of business structure is, what legal entity
to use, what types are available and what suits your business and
personal objectives best: These are the basic entities available:
- Sole proprietorship
- General partnership (OHG)
- Limited partnership (KG)
- Limited Liability Company (GMBH)
- Corporation (AG)
Besides there are also options that require no legal establishment in Germany:
- Branch of U.S. Company
- Foreign Sales Office
An attorney or accounting firm can help you make the right choice.
There are plenty law firms, accountants and consultancies that have
made international start-ups successful. They will also help you to
record the selected legal entity with the so-called Commercial Register
( Handelsregister ). The Commercial register provides clear public
information about the legal status, relationship and business situation
of companies in all of Germany. Registration in the Commercial Register
is essential for establishing specific forms of business entities.
Registration in the Commercial Register constitutes legal formation
with regard to these companies, which gain their legal identity only
through this registration process: Applicable local courts record The
Commercial Register.
But there are more factors to be included in the start up process. A
company needs to reassure itself, that its products comply with the
technical and safety related standards in Bavaria, Germany and the
European Market. A check with the “Testing Agency for Checking
Conformity to Standards” called TUEV ( Technischer Ueberwachungsverein)
will provide the necessary data. Of no less importance is to obtain a
CE certification for your product since for the European Union, the CE
mark is the manufacturer’s indication that it is in compliance with
regulatory and statutory requirements.
Taxation and Accounting issues will also require you to seek
professional assistance. It is usually well spend money since it
reduces your “ learning curve’ significantly and can avoid costly
mistakes. Select a good accounting firm, pick a good lawyer and use a
personnel consultant among others. The experts will be able to draw
your attention on the different types and rates of taxation among them
the VAT ( “MWSt”), Corporate Tax (“ Koerperschaftssteuer”), Trade Tax
(“Gewerbesteuer”).
The different health insurance and health care practices are another
area, which needs careful consideration when preparing to start up a
business entity in Bavaria. As important are indigenous personnel
practices, as the common practice that termination notice periods are
far longer than in the US, that they are contractual and strictly
enforced by labor courts.
Important in the start-up process is the consideration of the many
financing alternatives and investment incentives that are offered by
the State of Bavaria, the German Federal Government and in some cases
even the European Union. Some of them depend on the site selected for
your company. This might well be the most crucial decision, since it
will determine your market access, logistical base and such will impact
directly on your bottom line. Here an unbiased and professional site
selection professional needs to assist you early one and thoroughly.
What you have done well already is to consider Bavaria as a top choice
for your company: A state that continues to be pacing Germany’s
economic growth. It is for good reason that more than 1000
international companies call Bavaria their home away from home.
 Thomas Darcy & Partner
www.darcy-consulting.com
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Business 
