KNOWLEDGE BASE Government - Law In Germany
The information on this page was current at the time it was published. Regulations, trends, statistics, and other information are constantly changing. While we strive to update our Knowledge Base, we strongly suggest you use these pages as a general guide and be sure to verify any regulations, statistics, guidelines, or other information that are important to your efforts.
Government - Law In Germany
Germany is a democratic, federal, and social constitutional state. Germany consists of a Federal government and 16 federal states.
The Federal Government (Bundesregierung) is made up of the Federal Chancellor and Federal Ministers, the German Parliament, which is comprised of two chambers, the Federal Parliament (Bundestag) and the Federal Council (Bundesrat), and the Federal President (Bundespräsident [male] or Bundespräsidentin [female]).
The Federal Chancellor is elected by the Bundestag and she determines and is responsible for the general guidelines of government policy. She is tasked with choosing the Federal Ministers and determining the number of ministries and their responsibilities.
The Federal Parliament is made up of representatives elected by the German people every four years. The Federal Parliament's main responsibilities are drafting and passing legislation, approving the national budget, and voting to deploy the military (Bundeswehr). The Federal Council is the second chamber in the German Parliament. The Federal Council represents the federal states’ interests at a national level. The Federal Council is also involved in creating and approving legislation. There are 69 members in the Federal Council.
The Federal President is elected by the Bundesversammlung, which is made up of representatives of the Federal Parliament and an equal number of representatives from the state parliaments, for a five year term. The Federal President is the head of the German state. His roles are primarily ceremonial, but he does represent Germany at home and abroad. He has the power to appoint or dismiss the Federal Chancellor.
The German legal structure differs fundamentally from the Anglo-Saxon common law system, used in the United Kingdom and the United States of America, in which courts rely primarily on precedent from prior cases (case law). In Germany, judges base their decisions on legal codes under a civil law system. The German legal system is made up of three different types of courts: constitutional courts, ordinary courts (civil and penal), and specialized courts (administrative, financial, labor, etc.).
The Federal Constitutional Court (Bundesverfassungsgericht) is Germany’s highest and most important court. The ordinary courts are organized into 4 tiers: local courts (Amtsgerichte), regional courts (Landgerichte), higher regional courts (Oberlandesgerichte), and the Federal Court of Justice (Bundesgerichtshof).
In Germany, tax attorneys are called Steuerberater. Since tax law in Germany is considered one of the most complicated in the world, it is recommended that you consult a Steuerberater to help with your taxes and accounting.
In Germany, like many countries, there are international law firms, national firms, and smaller local or regional firms. It is easy to find specialized or industry specific attorneys and firms. German attorneys can practice in any court in Germany (with the exception of the Federal Supreme Court), however, in certain circumstances, it may be more beneficial to have a local attorney. For example, it may be helpful in local courts to have an attorney that speaks the dialect.
Notaries are particularly important and different in Germany (in civil law jurisdictions). Many documents and contracts are required to be notarized under German law. Furthermore, notaries in Germany are not the same as notaries in the United States. In Germany, a notary (notar/notarin) is a highly qualified individual who has been trained as an attorney. A German notary may provide advice to clients on legal transaction and draft, authenticate, and register legal instruments like wills, deeds, corporate registration applications, and trusts. A notary in Germany can also serve as a mediator in legal disputes.
Under German federal law, notaries are regulated by the Federal Notarial Code (Bundesnotarordnung or BNotO, available in German only)) and the Notarization Act (Beurkundungsgesetz or BeurkG, available in German only).
With the exception of local courts, you are required to be represented by an attorney in court.
Court costs and legal fees
Attorney’s fees in Germany are subject to several legal regulations, including the Law on the Remuneration of Attorneys (Gesetz über die Vergütung der Rechtsanwältinnen und Rechtsanwälte) (RVG) and the Federal Lawyers’ Compensation Act (Bundesrechtsanwaltsordnung) (BRAO). Attorneys in Germany are generally paid by the hour like many other jurisdictions. For a partner at a full-service firm, you can expect to pay between € 350 and € 550, while hourly rates at boutique firms run between €300 and €400. Fixed fee arrangements are growing in popularity, but contingency fees are permitted only to a limited extent.
Germany has a “loser pays” legal fees practice.
Alternative dispute resolution
Arbitration is gaining popularity in Germany, particularly in commercial disputes, but because of the efficiency of the German court system, the impartiality of the judges, and the cost-effectiveness of the process, the court system is popular. Arbitration is not used in the majority of domestic disputes, and is rarely used in matters concerning banking and finance and retail. Arbitration clauses are commonly seen in international contracts. Mediation is available, but not widely used in Germany.
KNOWLEDGE BASE Government - Law In Germany