What legal requirements apply to the establishment of a subsidiary abroad?
February 2, 2024 | 50,00 EUR | answered by Alexander Voigt
Dear lawyer,
My name is Siegfried Schillinger and I am the managing director of a medium-sized company in Germany. We are planning to establish a subsidiary abroad in order to expand our business internationally. However, I am unsure about the legal requirements that need to be considered in this process.
Currently, we are registered as a GmbH in Germany and primarily operate in the domestic market. We have already identified some potential locations for the establishment of a subsidiary, but we lack knowledge about the local laws and regulations that need to be adhered to when establishing a foreign entity.
My biggest concern is that we may expose our company to legal risks during the establishment of the subsidiary, which could potentially cause difficulties for us. Therefore, I want to ensure that we take all necessary steps to carry out the establishment legally and smoothly.
Could you please provide me with information on the legal requirements for establishing a subsidiary abroad? What specific steps do we need to take to meet the legal requirements and what documents are needed? Are there any specific laws or regulations that we need to consider, depending on the location of the subsidiary?
I appreciate your assistance and advice in advance.
Best regards,
Siegfried Schillinger
Dear Mr. Schillinger,
Thank you for your inquiry regarding the establishment of a subsidiary abroad. It is understandable that you are concerned about the legal requirements and want to ensure that your company takes all necessary steps correctly to avoid legal risks.
When establishing a subsidiary abroad, there are a number of legal aspects to consider, depending on the location of the subsidiary and the local laws and regulations. First and foremost, it is important to check if the selected country allows foreign investments and if there are certain requirements or restrictions for foreign companies.
In many countries, foreign companies, for example, must obtain permission or register with local authorities to establish a subsidiary. It may also be necessary to appoint a local manager or meet certain minimum capital requirements.
Furthermore, you should check if there are specific licensing or approval requirements that are relevant to your company, depending on the industry and field of activity. For example, companies in the financial or healthcare sectors often require special licenses or approvals to operate abroad.
It is also important to consider the tax aspects when establishing a subsidiary abroad. You should check if there are double taxation agreements between Germany and the country where you want to establish the subsidiary to ensure that your company is not taxed twice.
To smoothly carry out the establishment of a subsidiary, I recommend consulting with an experienced local lawyer who can assist you with all legal steps. A lawyer can help you understand the local laws and regulations that apply to your subsidiary and ensure that all necessary documents are correctly prepared and filed.
I hope this information is helpful to you and I am available for any further questions you may have.
Best regards,
Alexander Voigt
