Doubts about the GbR’s voluntary registration in the new company register

  • 06/21/2023
  • Reading time 5 Minutes

As of January 1, 2024, the German law on the modernization of partnership law (“MoPeG”) will come into effect. It includes comprehensive amendments to the German Civil Code (“BGB”), in particular on the regulations for partnerships under German Civil Law (“GbR”).

Once the MoPeG has come into effect, the GbR can, inter alia, be registered in a special company register. The law provides for such registration to be voluntary; however, a closer examination reveals that failure to register will render the GbR largely unable to conduct any legal transactions. We take a look on the legislative changes’ future effects on the GbR and provide some practical advice on how to deal with them. 

Is a GbR a legal entity?

In principle, the MoPeG’s coming into effect is going to standardize what already applied according to a fundamental decision of the German Federal Court of Justice (“BGH”): The (external) GbR has legal capacity. It can acquire rights and enter into obligations. The new law distinguishes between a company with legal capacity and a company without legal capacity. 

A GbR has legal capacity if it is intended to participate in legal transactions in accordance with the joint, even implied, will of the partners. In this context, however, the GbR with legal capacity is to exist as a standard legal form irrespective of entry in the new company register in Germany.

Waiving the GbR’s entry in the company register is generally possible. Once a GbR has been registered, it can only be deleted in accordance with the general requirements. Thus, the legislator deliberately avoids a situation in which a registered company is deleted without liquidation in the event of a financial collapse outside the insolvency proceedings provided for this purpose.

Where is a GbR registered?

The local courts have jurisdiction for the registration procedure. The GbR’s initial registration is made without restriction by all partners. In this context, information on the company, the partners, their powers of representation and, if applicable, the GbR’s business purpose are provided. If individual partners are to be exempt from the restrictions pursuant to Art. 181 BGB, such exemption will have to be registered as well. 

Is a registered GbR entitled to any legal transaction?

Even though the company’s registration is subject to the GbR shareholders’ free decision, it will not be entitled to certain legal transactions without registration. This includes, for example, the acquisition or sale of a real property right or a GmbH share. Unregistered companies are blocked from registration in the land register. The participation of a GbR in transformation transactions under the German Transformation Act is also subject to prior registration.
Apart from that, when the GbR opens an account, credit institutions might request a registration in the company register instead of separate powers of attorney and declarations of liability. These circumstances basically result in a de facto obligation to register. 

What are the new company register’s advantages for the GbR?

The company register’s advantages should, however, not be disregarded: Due to its publicity, the legal relationships between the shareholders inter se can easily be determined free of charge by inspecting the German federal states’ Common Register Portal. Thus, the existence, identity and representation are publicly available. For example, potential tenants of a GbR established for the purpose of leasing business premises can easily obtain information about the partners’ powers of representation. Apart from that, the law continues to assume a joint representation of the partners, unless otherwise provided for by the articles of association. 

Thus, the company’s publicity effect increases and with it the possibility of gaining access to a larger circle of business partners and improving one’s own creditworthiness. However, in order to ensure a smooth participation in legal transactions, it is important to ensure that the registrable information is always correct. This is because in the event of an incorrect entry, legal transactions can invoke register publicity.

Who is liable for a GbR?

Due to its importance in practice, it should be pointed out that the law provides for the partners’ joint and several personal liability for the GbR’s liabilities. Any agreement to the contrary is invalid in relation to third parties.

How to evaluate the MoPeG’s effects on the GbR

Due to the MoPeG, the GbR, originally known as joint venture, now becomes a partnership with its own legal capacity, established for a certain period of time. Nevertheless, the partners still have the option of establishing a GbR only for asset management purposes. The form of a GbR with legal capacity is particularly suitable for members of the liberal professions and, for example, for the management of real estate.

Possible delays in the registration process once the MoPeG comes into effect at the beginning of 2024 should not be underestimated. This is due, on the one hand, to the fact that registrations will only be possible after January 1, 2024; on the other hand, registration requires the involvement of a notary public. Therefore, the companies will be largely unable to act during this period.

It is therefore advisable to already take the delays into account in the case of corporate or real estate transactions, should the transactions take place in the new year. Potential buyers may have to prepare for fewer property transfers. Despite the not only insignificant restrictions, the amendments to the law reflect, overall, previous legal practice and thus result in practical simplifications for partners and legal transactions.

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Author of this article

Oliver Köster, LL.M.


Attorney-at-Law (Rechtsanwalt)

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