Appointing a Foreign Director (Non-Resident) for a German GmbH

German Corporate Lawyers

Appointing a Foreign Director (Non-Resident) for a German GmbH

German Corporate Lawyers

At Schlun & Elseven Rechtsanwälte, we are often approached by corporate clients regarding the legal implications of appointing a foreign director to their German GmbHs. Although it is true that it can be a complicated process, it is often worth bringing in outside skill and experience. Our lawyers are available to advise you regarding the procedures involved with appointing a foreign director and we provide compliance guidance relating to the legal requirements.

Please, do not hesitate to contact us directly for specialised assistance in this matter.

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Conditions for Appointing a Foreign Director to a German GmbH

No specific restrictions prevent German GmbHs (limited liability companies) from appointing a foreign director; however, there are specific steps that a director should take to be eligible for an appointment.

Firstly, they need to be eligible to work in Germany. If the director is based abroad and wants to start working in Germany, they must acquire a work permit via the German embassy or consulate in their home country. Appropriate work permits include the EU Blue Card, the ICT Card and the national work permit. At Schlun & Elseven Rechtsanwälte, our legal experts advise on all matters relating to eligible visas and residence permits for Germany.

It should be noted that it can be a lengthy process to obtain such a visa. Working with our lawyers will ensure that the process is accelerated wherever possible.

Upon arrival in Germany, the director needs to register with the tax authorities, obtain a tax ID number, open a German bank account and register for social security. Our lawyers have extensive experience in supporting foreign directors and other professionals in matters of relocation to Germany and will provide the guidance needed on such issues.

Companies appointing the director should ensure that the appointment is correctly documented in the company’s articles of association. Those articles of association should outline the rights and responsibilities of that director and provide a framework for them. Companies cannot discriminate against directors based on their nationality.

Foreign directors need to be aware that some general requirements must be met to be allowed to be a director under German law. They are the following:

  • The director must be at least 18 years old.
  • The director must not be legally incapacitated (e.g. due to mental illness or bankruptcy).
  • The director must not be disqualified from holding the position due to prior criminal convictions.

If you require further advice regarding the requirements to be a foreign director for a German GmbH, please do not hesitate to contact our team directly.

EU Blue Card Applications and Other German Visas

Possessing a valid visa is one of the few requirements that a foreign director requires when working in Germany. This condition does not apply to applicants from other European Union countries, EEA members and Switzerland.

For directors from other (third countries), they will require an appropriate work permit. At Schlun & Elseven Rechtsanwälte, our team provides expert assistance with EU Blue Card applications and is available to manage the application from the beginning.

To be eligible for an EU Blue Card, the applicant needs to have obtained a job offer in the EU, and that salary needs to pay above the required threshold. It should be noted that this amount changes every year. There are some cases where the salary requirements may be reduced. Applicants may be within this category if they possess qualifications in areas of short supply in Germany, such as the sciences, mathematics, technology or engineering.

Applicants need to be aware that the EU Blue Card is designed for highly qualified individuals, so a university degree is necessary. Furthermore, the university degree needs to be recognised in Germany.

There are many advantages associated with the EU Blue Card, as it allows for family reunification in Germany, accelerated access to a permanent residence permit and the possibility of travelling freely within the Schengen area.

However, there are also some areas of legal concern, including what should happen if an EU Blue Cardholder loses their job during the time they are in Germany based on that residence permit and whether it is permitted to change position as an EU Blue Cardholder. Our lawyers are ready to answer all your questions relating to the EU Blue Card.

Advantages of Hiring a Foreign Director to a German GmbH

The process of appointing a foreign director to a German GmbH carries some risks but in many cases, the benefits outweighs the more difficult aspects.

Foreign directors often provide German companies with invaluable international experience and expertise. Such qualities can play an enormous role in the future growth of the company, and motivate the company’s employees to increase their productivity based on procedures that have worked in other markets. Additionally, this new perspective may allow the company to expand its international reach or access other markets not previously considered.

Foreign directors can also provide the company with new connections in such markets. Their additional language skills may allow the company to access new business partners that were not previously possible.

Companies should strongly consider these potential benefits when considering an outside candidate for a director position, as there are often logistical challenges in the early stages of hiring them.

At Schlun & Elseven Rechtsanwälte, our legal professionals to advise companies and directors regarding any legal implications involved in such cases.