The civil law partnership (Gesellschaft bürgerlichen Rechts, GbR) is the simplest form of joint business in Germany for two or more people. With the reform of partnership law (MoPeG), the GbR has gained new options, including voluntary registration in the partnership register.

How a GbR comes into being

A GbR is formed automatically as soon as two or more people agree to pursue a common purpose together. The law does not even require a written agreement, but an oral agreement is extremely risky at the first disagreement between partners.

Joint, several and unlimited liability

All partners are personally liable for the GbR's debts and obligations with all their assets, jointly and severally (gesamtschuldnerische Haftung). This means that if one partner signs an unfavourable contract or causes a client a loss, creditors can claim the full amount from any partner they choose.

The new partnership register (eGbR)

Since 2024, partnerships can register in the partnership register (Gesellschaftsregister) and become a registered GbR (eGbR). Registration is effectively mandatory if the partnership wants to acquire property or shares in a GmbH and other companies whose rights are recorded in registers. If the joint activity grows into a commercial business requiring a merchant's set-up, the GbR automatically becomes a general partnership (OHG) by law.

The key points of a partnership agreement

A well-drafted written GbR agreement sets out how decisions are made (unanimously or by majority), who may sign contracts on the firm's behalf, each partner's share of profits and losses, how working time is compensated and a clear procedure for a partner leaving or the business being wound up.

What to check

  • Sign a detailed written partnership agreement before any joint business spending.
  • Set limits on the value of deals a partner may sign without the other partner's consent.
  • Take out liability insurance in the partnership's own name.
  • Decide whether the partnership needs to be entered in the register as an eGbR via a notary.

Example situation

Two web developers set up a GbR to run client projects and agree a 60/40 split of net profit to reflect one partner's work on the system's core.

Next step

A GbR is an easy way for partners to start, but because each is liable for the other's debts, it requires complete mutual trust.

Official information on this topic

Checklists and examples are organisational recommendations. Requirements depend on the procedure, the city and your situation; check them with the relevant office before you act. Please discuss legal and tax questions with an authorised professional.

This article was prepared with the help of AI. The example illustrates the approach and does not describe a client case.