eGBR: New legal situation for real estate purchases

What is new and what will change for property owners?

The good news is that nothing will change for property owners for the time being, as long as they do not want to sell their property or purchase a new one. Entry in the commercial register is only mandatory when real estate is bought or sold or when a land charge is registered. As an alternative to eGbR, fractional ownership remains an option for joint real estate purchases. With this form of co-ownership, the shares of the individual owners are recorded in the land register.

The following applies to the eGbR:

• No longer listed by name in the land register
  With an eGbR, the names of the partners are no longer entered in the land register. Instead, only the eGbR is listed as the owner. This increases transparency and at the same time protects the privacy of the partners.
• More cost-effective changes
  Changes to the eGbR, such as the departure or addition of partners, are significantly more cost-effective and time-saving compared to changes in the land register.
• Company register
  The eGbR is listed in the company register. This means that important information about the company, such as the names of the partners and the management, is publicly accessible.
• Legal capacity
  The eGbR is a company with legal capacity. This means that it can independently conclude contracts, acquire property, and be represented in court.
• Conversion to other legal forms
  Converting an eGbR into other legal forms, such as a GmbH or an OHG, is easier and less expensive than with an unregistered GbR.

Step by step: The procedure for the initial registration of a GbR as an eGbR

1. Partnership agreement:
The partnership agreement must contain the most important information about the eGbR, e.g., the names of the partners, the purpose of the company, and the distribution of profits. The agreement can be drawn up by the partners themselves, but should ideally be certified by a notary or lawyer.

2. Notarization:
The partnership agreement must be notarized by a notary. The notary checks the validity of the agreement and enters the eGbR in the commercial register.

3. Entry in the transparency register:
The eGbR must be entered in the transparency register within 14 days of its entry in the company register.

Why the eGbR is important for buyers and sellers and why prompt registration is recommended

The eGbR offers buyers and sellers of real estate greater legal certainty. Registration in the company register clearly shows who owns the property and who is authorized to sell it. At first glance, however, the new procedure leads to additional costs, increased bureaucracy, and a longer planning phase. In many cases, the eGbR must first be established, as the legal capacity required for the purchase and sale only arises upon registration. For all future transactions, however, registration prevents uncertainties and legal disputes.

• 1. Avoidance of fines:

From January 1, 2024, fines will be imposed on GbRs that acquire real estate assets and are not entered in the company register, or if a GbR does not notify the transparency register immediately after entry in the company register, or if the notification is late, incomplete, or contains incorrect information. The amount of the fine depends on the size and turnover of the company.

• 2. Legal certainty in real estate acquisition:

The entry of the eGbR in the commercial register is of great importance for legal certainty in real estate acquisitions. Without this entry, it is not possible for buyers and sellers to clarify the ownership of the property beyond doubt. This can lead to considerable problems and legal disputes.

• 3. Facilitating future changes to the eGbR:

Changes to the eGbR, such as the departure or addition of partners, are significantly less expensive and time-consuming than changes in the land register if the eGbR is already entered in the company register.

• 4. Greater transparency:

Entering the eGbR in the commercial register increases transparency while protecting the privacy of the partners. Only the most important information about the eGbR is published in the register, such as the names of the partners, the management, and the purpose of the company.

• 5. Faster transaction processing:

Entering the eGbR in the commercial register can speed up the processing of transactions, such as concluding contracts or applying for loans. This is because the eGbR is recognized as a legal entity by its entry in the register.

• 6. Easier opening of bank accounts:

Registering the eGbR in the commercial register usually makes it easier to open a bank account for the company. Banks often require proof of the company's existence in order to open an account. Registration in the register serves as such proof.

• 7. Improved credit rating:

Entering the eGbR in the company register can improve the company's credit rating. This is because, once entered in the register, the eGbR is considered a reputable and reliable company.

Kartheuser Immobilien: Your partner for the secure sale and purchase of real estate in Mettmann, Ratingen, and Velbert

The introduction of the eGbR brings far-reaching changes for real estate acquisition. With the obligation to register from 2024 for all GbRs that hold real estate assets, the eGbR offers both buyers and sellers of real estate greater legal certainty and transparency. As an experienced real estate agent, we are happy to assist you with all questions relating to the eGbR and real estate acquisition. We provide comprehensive advice and support you in implementing the new regulations.

Contact us today for a no-obligation consultation!

Additional information:

• The above information is for general information purposes only and does not constitute legal advice.
• In individual cases, you should seek advice from a lawyer or notary.
• Further information on eGbR can be found on the website of the Federal Ministry of Justice and Consumer Protection: https://www.bmj.de/SharedDocs/Gesetzgebungsverfahren/DE/2022_GesellschaftsregisterVO.html