Opening a Branch of a Foreign Company in Germany

If a foreign company wants to become permanently active in Germany, it can open a branch. A branch is a legally dependent or independent part of the parent company, which must nonetheless be registered separately with the relevant German authorities — such as the commercial registry and the trade office. It allows the company to operate under a German business address, enter into contracts, and employ staff locally.

Independent vs. Dependent Branch

There are two forms:

• Dependent branch: It has no management of its own and no separate accounting. All key decisions and administration continue to run through the head office abroad. This form suits situations where you only need a local presence, without operating independently on-site.
• Independent branch: It has its own management and its own bookkeeping on-site and largely operates like a standalone company in business dealings — although legally it remains part of the foreign parent company.

Depending on your business model, registering payroll accounting may also be required once you employ staff in Germany.

Virtual Office or Branch — What's Right for You?

A virtual office is sufficient if you only need a representative German business address and mail handling — for example, to support clients or test the German market initially — without employing staff or operating on-site. Once you plan to be permanently operational in Germany, hire local staff, or conduct business independently, registering a branch is the right step.

Legal Advice and Registration

Registering a branch is a legally demanding process that requires a careful review of your individual situation. For legal advice and the actual registration, we recommend our partner von Engelhardt, who specializes in company formation and branches of foreign companies in Germany.