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Structuring advice
Legal assessment of the planned activity and development of a structure that fits the existing corporate structure in Germany.
Germany · USA
Establishing a business in the USA
Entering the US market often begins with the question of the right corporate structure. We advise German entrepreneurs and companies on the legal groundwork for establishing a US company. The formation itself is governed by the law of the respective US state and is carried out by or together with appropriately licensed US attorneys, whose involvement we coordinate.
Overview
Which corporate structure fits the project?
Before any formation comes a preliminary question: does the project require a US company of its own at all? Sales through a partner, a representative model or a cooperation can open up the same market access without creating a separate legal entity.
Where a company is the right route, the suitable structure depends, among other things, on the business model, the group of shareholders, the planned financing, the place where the business is actually carried out, the allocation of liability and the tax framework. A structure that suits a software company with investors in view is rarely the right one for a mid-sized manufacturer with US distribution.
Tax advice is provided by tax advisors and Certified Public Accountants (CPAs). Where tax questions shape the structuring decision – and they regularly do – we bring them in.
Services
How we support the establishment of a US company.
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Corporate documentation
Preparing and reviewing the formation documents and the agreements among the parties involved – for the US-law elements, by or together with US attorneys licensed in the relevant state.
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Resolutions on the German side
Shareholder resolutions, powers of attorney and supporting documents that the German company has to provide for the formation.
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Contracts of the US company
Supply, service, license and distribution agreements as well as cross-border contract drafting.
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Protecting trademarks and IT
Safeguarding trademarks, software and data in US business, including IT & Social Media.
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Coordination
Bringing in US attorneys in the relevant state as well as tax advisors and CPAs, and consolidating the results.
Legal form
LLC or corporation?
The limited liability company (LLC) and the corporation are both separate legal entities whose liabilities do not, as a rule, fall on the owners personally. Where they differ is in their internal governance.
- The LLC can be shaped largely as the members see fit. Its internal order – ownership, management, profit distribution, exit – is set out in the operating agreement rather than in statute. This offers room for design, but calls for careful drafting.
- The corporation is formalized: shareholders, board of directors and officers, the passing of resolutions and record-keeping follow fixed lines. This structure is familiar to investors and geared toward financing rounds.
Which form is right is not decided in the abstract, but by the project. Tax consequences – in Germany and in the United States – are an essential part of this decision and are assessed by tax advisors and CPAs, whom we bring in for this purpose.
Where shareholder structures already exist in Germany, it also needs to be clarified how the US company fits in – as a subsidiary, as a sister company, or as a personal holding of the shareholders.
Location
In which US state should the company be formed?
Delaware is not automatically the right choice. A company formed there but operating in California or Texas additionally registers as a foreign entity in the state where it does business – with two sets of obligations. The starting point is therefore the actual business activity, not the reputation of a state.
- Where the business is actually carried out
- Customers, staff and places of business
- Planned financing and investors
- Registration and reporting obligations
- Registered agent requirements
- Tax framework (through tax advisors and CPAs)
Process
From planning to the US company.
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Strategy and business model
What is actually meant to happen in the United States – distribution, production, services, investment – and within what time frame.
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Suitable structure
Whether a separate company is required and what form it should take, aligned with the German structure.
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Choice of state
Based on the actual activity, the local obligations and the planned financing.
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Formation and documentation
Preparing the formation documents, the internal agreements and the resolutions on the German side; the formation under state law by or together with licensed US attorneys.
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Contracts and operational structure
The agreements that carry day-to-day business and the relationship with the German company.
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Coordination with US advisors
Bringing in licensed US attorneys as well as tax advisors and CPAs where their responsibility begins.
Questions and answers
Frequently asked questions on establishing a business in the USA
Can a German national set up a company in the United States?
As a rule, a US company can also be formed and owned by persons who do not live in the United States. The details are governed by the law of the respective state.
Can I form an LLC without living in the United States?
Under the law of many states, the members of an LLC do not have to be based in the United States. In practice, however, further points need to be resolved, such as a registered agent in the state of formation, the internal structure by way of an operating agreement, a bank account and supporting documents. Tax consequences are assessed by tax advisors and CPAs.
LLC or corporation – which makes sense?
Both are separate legal entities with different internal governance. The LLC can be designed flexibly and is organized through an operating agreement; the corporation has a formalized structure with shareholders, board of directors and officers and is geared toward financing rounds. Which form fits depends on the business model, the owners, the financing and the tax framework – there is no general recommendation.
Does a US company have to be formed in Delaware?
No. Delaware is widely used because its corporate law is well developed and familiar to investors. For a company whose business actually takes place in another state, forming the company there may make more sense – otherwise, registration as a foreign entity in the state of operation is added to the formation. The decisive factor is the actual business activity.
Which contracts does a US company need?
That depends on the business model. Typical are the formation and ownership documentation, agreements between the German parent and the US company – for example on supply, services or licensing –, distribution and cooperation agreements, and non-disclosure agreements. These agreements hold the structure together and should not be left until later.
Your contacts
Corporate law with a US dimension.
J.-Alexander Bürger
Rechtsanwalt · Attorney at Law (Florida)
Juris Doctor (Miami), admitted in Germany and as an Attorney at Law in the US state of Florida, with several years of practice at a US law firm. His work focuses on corporate law and the structuring of cross-border holdings.
Darja Hannekum, LL.M. (University of Miami)
Rechtsanwältin & German civil-law notary (Notarin)
Certified Specialist Lawyer for IT Law (Fachanwältin für IT-Recht)
Master of International Law (Miami). She advises on the contractual and digital side of the structure – license and software agreements, trademark protection and IT & Social Media in US business.
More on Germany · USA
Further cross-border topics.
German-US contracts
Choice of law, jurisdiction, liability and IP in cross-border agreements.
US market entry
Legal structuring of German companies’ US activities.
German-US business relationships
Distribution, cooperation and supply relationships across the Atlantic.
Germany · USA
Thinking across borders.
Acting with legal clarity.
Tell us about your matter between Germany and the United States. We will assess how we can support you and which further advisors should be involved where appropriate.