Niederlassung (branch office)
A Niederlassung is a branch office - a dependent or autonomous establishment of a company at another location, not a separate legal entity of its own.
German law distinguishes a Zweigniederlassung (an autonomous branch entered in the commercial register, with its own management and accounting) from an unselbständige Niederlassung (a mere dependent office). A branch is not a subsidiary: it has no separate legal personality, and the parent company remains directly liable.
When a German company enters the US, registering a "branch" of the German entity is possible but uncommon; most form a US subsidiary (an LLC or corporation) instead, to ring-fence US liability and simplify US taxation.
See also: Tochtergesellschaft (subsidiary), GmbH
Frequently asked questions
- Branch or subsidiary for the US market?
- Most German companies form a US subsidiary rather than a branch. A subsidiary is a separate US entity that limits the parent's liability and is taxed as a US company; a branch leaves the German parent directly exposed to US liability and tax filing.
- Is a Niederlassung registered separately?
- An autonomous branch (Zweigniederlassung) is entered in the commercial register at its location; a purely dependent office is not. Neither becomes a separate legal entity.