Expansion to Germany

As part of the EU, the German market is generally more heavily regulated than the Swiss market. However, strict German regulation also opens doors: an expansion to other EU countries with less strict regulation becomes an easier step, and often the entire EU market can be served from Germany. The most important issues that affect almost every company are data protection (GDPR), consumer protection and competition regulations. In addition, there are industry-specific regulations, e.g. in finance, insurance or medical devices.

Intellectual property is protected in Germany in a similar way to Switzerland. Trademarks and patents registered in Switzerland are only protected in Switzerland — for protection in Germany or the EU they must also be registered in the German Patent and Trademark Office (DPMA) or the EUIPO. Copyrighted works are protected in Germany automatically without registration. Technical inventions are most effectively protected by a patent application or, faster and cheaper, as a utility model.

In the B2B sector, caution is required when including general terms and conditions: the counterparty's GTCs can automatically take precedence if sent with an offer and not actively objected to. German courts also tend to apply consumer-friendly GTC interpretation even in B2B contexts. In the B2C sector with German consumers, Swiss law cannot simply be chosen — the choice-of-law clause must guarantee the more favorable domestic law for the consumer. GTCs must be updated regularly in line with German case law.

Job descriptions must be written carefully to avoid discrimination claims. Minimum wage rules apply, including for most interns. Fixed-term employment contracts must be signed by hand, otherwise they convert to indefinite-term contracts. When engaging freelancers, false self-employment is the biggest risk — reclassification by the German pension insurance fund can trigger substantial back-payments of social security contributions and taxes, plus criminal consequences.

In companies with ten or more local employees, strict dismissal rules apply: any ordinary termination requires a legitimate reason — operational, personal or behavioural. Behavioural terminations require a prior formal warning. Every notice of termination must be signed by hand; termination by email is invalid in Germany. Extraordinary (summary) terminations also require a legitimate reason and must be carefully documented.

Virtual participation plans (VSOPs) are the prevailing model in Germany. Unlike real share options, VSOPs are only taxable when a liquidity event occurs and the employee receives cash — avoiding tax liability before any money flows. Real share transfers in a German GmbH must be notarized, making VSOPs administratively simpler. We support you in rolling out a German or cross-border employee participation programme tailored to your structure.