Free choice of registered office for partnerships

The restriction on the free choice of the registered office of a partnership has been removed with effect from January 1, 2024. Since the Act to Modernize the Partnership Law (Gesetz zur Modernisierung des Personengesellschaftsrechts, “MoPeG”) came into force, the partners of a partnership have the possibility to agree and determine a registered office in the partnership agreement. This contractually agreed registered office is also known as the "contractual registered office" (Satzungssitz). In contrast, there is still the “administrative registered office” (Verwaltungssitz). This both gives shareholders new structuring options.

Facts of the case

In this context, the following decision of the Berlin Court of Appeal (“Kammergericht”) on the legal situation prior to the MoPeG should be considered in order to classify the significance of the new option: The shareholders of a partnership under German law in the concrete legal structure of a Kommanditgesellschaft (“KG”) applied for the transfer of the company's registered office. The registry court rejected the application on the grounds that a relocation of the company's actual registered office was not demonstrated. This was because a corresponding questionnaire from the competent Chamber of Industry and Commerce regarding the place of management and the focus of the company's business activities remained unanswered by the company and its partners. The notary who had made the registration lodged an appeal against the decision on the grounds that the company could be contacted at the address and that a labeled letterbox existed.

The decision of the Kammergericht Berlin of May  8, 2023 (22 W 21/23)

The appeal was unsuccessful. First of all, the court assessed the appeal submitted by the notary as an appeal by all partners of the company. However, in the opinion of the court, the registration of the transfer of the registered office was to be rejected. This was because the new registered office to be entered was neither the place from which the company's business was managed nor the place where the company's business activities made. A business, the management and/or the administration could not be determined at the new location to be registered. Postal accessibility alone is not sufficient to establish the company's registered office.

In contrast to this decision on the old legal situation, the partners now have the new option under the new legal situation of the MoPeG to contractually specify the location they wish as the "contractual registered office". In this case, postal accessibility is also sufficient without this being questioned to by the register court.

Practical advice

The registered office of a company is important for the company. On the one hand, the partners thereby manifest their will to jointly participate in legal and commercial transactions. In addition, the location of the company's registered office is decisive for establishing the local jurisdiction of the courts.

The Act to Modernize the Partnership Law (MoPeG) led to extensive liberalization for partnerships when it came into force on January 1, 2024:

• Registered office of the partnership:

The partners of a partnership can now freely determine the registered office of the company its partnership agreement (so-called “contractual registered office”, Satzungssitz). This may differ from the so-called “administrative seat” (Verwaltungssitz), i.e. the place where the company's business is conducted. If the partners agree for a contractual registered office, this is the official registered office of the company. Without such a contractually agreed registered office, the administrative seat is automatically deemed to be the registered office of the company. The prerequisite for the choice of registered office is that the contractual registered office (i) is specified in the articles of association, (ii) is in Germany and (iii) is entered in the register.

• Change of registered office, also abroad:

The contractual registered office can also be changed retrospectively. In contrast to the case decided by the Kammergericht Berlin on the former legal situation, this is not prevented by the fact that the new (contractual) registered office is not the administrative seat. This means that the operating activities of the company can also be relocated abroad or already be located abroad when the company is founded, while the contractual registered office is in Germany. A legal form under German law desired by the shareholders remains in place despite the relocation of the operational business and/or administration. Therefore, a company does not have to be dissolved as a result of the relocation. Only the contractual registered office must be in Germany.

• Shareholding structures according to contributions:

The MoPeG has also led to an approximation of partnership law to the law of corporations in terms of shareholdings. Unless otherwise stipulated in the articles of association, the weighting of votes and profit and loss participations are no longer based on heads, but on the contributions of the shareholders.

• Liability issues:

The MoPeG has also clearly regulated the liability of partners in partnerships for new and old liabilities. However, individual contractual agreements between the partners outside of the articles of association remain possible. Such agreements are often indispensable for the protection of interests.

• New company register:

The new company register for companies in the legal form of a “Gesellschaft bürgerlichen Rechts” (“GbR”) is also new. For legal transactions, registered GbRs can now be recognized by the name affix "eGbR". Furthermore, the registration of key facts (e.g. representation relationships) provides greater protection for legal transactions. For some GbRs, there is also an obligation to register (e.g. in the case of real estate property, acquisition/holding of shares in other companies).

The new partnership law is in force. All partners of a partnership should therefore have already checked or at least promptly check whether and in which areas they are affected by the changes. If necessary, it may be advisable to amend existing partnership agreements.