Freelancers and Trade Requirements: do you have more paperwork to do?

Meeting new freelancers, I'll often say: if you do not like rules then do not start a business in Germany. When it comes to running a business in Germany - it's all about the right paperwork and for whom! Do you have a freelance / self-employed business that needs more certification or additional trade registrations? So, you're ready to make the transition from employment to being your own boss, but first, you need to assess if you will need an additional trade registration. Today we are going to focus specifically on the Crafts industry, but it will be necessary to cover food and other professions in future articles. So, craftspeople, and we know that is many of you - let’s get started!

Anyone who wants to become self-employed in the craft business must be registered in the handicraft role. There are, surprise, some strict entry requirements. First we need to define if YOU would need a craft registration and there are three pretty confusing categories on this topic:

The exercise of a craft requires registration

1. into the crafting role, if a trade requiring certification is exercised (This is given the Class A position in the registration process)
   
   Self-employment in a handicraft subject to authorization is only permitted to persons registered in the crafting role. The entry into the crafting role depends on the qualification of the manager. As a rule, this is a master craftsman's certificate. If you, as the owner, do not fulfill the requirements for practicing the craft in question, you can hire a company manager who will take over the technical and technical direction and who has the master craftsman certificate or an equivalent qualification.
   
   
2. in the directory of the owner of a company of a ‘’licence free craft’’ (This is given the Class B1 status in the registration process)
   
   You can become self-employed in the non-approved crafts if you have no further admission requirements. However, they must notify the Chamber of Crafts immediately. You will then be entered in one of the above directories after submission of the application.

1. in the register of the owner of a ‘’craft like business’’ (This is given the B2 status in the registration process)
   
   In craft-like trades you can become self-employed without further admission requirements. However, they must notify the Chamber of Crafts immediately. You will then be entered in one of the above directories after submission of the application.

You can become self-employed in the non-approved crafts and handicraft-related trades without further admission requirements.  However, there is no other choice but to notify the Chamber of Crafts immediately. You will then be entered in one of the above directories after submission of the application.  Self-employment in a handicraft is ultimately subject to authorization is only permitted to persons registered in the crafting role.

The entry into the handicraft role depends on the qualification of the Manager. As a rule, this is a Master Craftsman's certificate.  If you, as the owner, do not meet the requirements for practicing the craft in question, you can hire a manager who will take over the technical and technical management and who has the master craftsman certificate or equivalent. 

Whether or not you are carrying out a trade requiring a license can be found in the list of occupations in Annex A to the Handwerksordnung - yes, yet another Amt you can have the pleasure of getting to know personally. 

Requirements for exercising a trade requiring a license

Master's Certificate

If you or your selected manager have passed the master examination in the handicraft requiring trade, which you would like to practice or successfully passed in a related craft, you can be entered in the handicraft role. You’ll really have to ask directly what the Handwerksordnung would define as a ‘’Masters’’ certificate or what would indicate this level of mastery. This is very applicable if you are an expat - for example, the translation of a Certificate Equivalent obtained in Australia my not meet the requirements for German expertise - yes, really - WELCOME!

No master examination - what now?

If you do not have a master exam, you will find alternative enrollment requirements below.

The Handwerksordnung also stipulates provisions according to which you or your operations manager can be entered as a graduate engineer or engineer or with a German state or state-recognized examination equivalent to the master's examination. The prerequisite is that the study or school focus of your exam corresponds to the craft to be entered. 

Exception approval according to § 8 Handwerksordnung (HwO)

One possibility to obtain an entry in the crafting role is to apply for an exemption. In addition to the proven expertise, there must be an exceptional reason for this, ie taking a master's examination represents an unreasonable burden for you. The reasons can be manifold, as a rule, an exception reason is assumed, for example, if the age of about 47 years has been reached. Seems legit...

Exercise right in accordance with § 7b Handwerksordnung (OeS)

If you have a journeyman's certificate in your chosen craft and you can prove that you have 6 years' work experience and at least 4 years in a managerial position, then you have the option to apply for an exercise right pursuant to § 7b. However, this does not apply to chimney sweeps and health crafts. 

Exception approval according to § 9 Handwerksordnung

If you are a citizen of a member state of the European Union (EU) or a state party to the Agreement on the European Economic Area (EEA) or Switzerland, you can obtain an entry into the role of craftsmen via an exemption permit according to § 9 HwO. The prerequisite is that you have worked for a certain time in one of the above-mentioned states as a self-employed person or as a manager in a corresponding craft.

Alternatively, you have successfully completed relevant specialist training abroad; even then you can make an application. Excluded from the recognition of the occupation are the chimney sweep trade and the health handicrafts.

Registration procedure

If you have a trade requiring certification and have provided the necessary qualifications for the exercise, you can be entered in the handicraft role.  The procedure also applies to license-free crafts and craft-like trades, although you do not have to provide proof of qualification here. To apply for registration, fill out the application form and, as far as it concerns a handicraft requiring a license, enclose a copy of your qualification certificate (eg master's certificate or special permit).

If the application is available to your chamber of trade and all documents are complete, you will be entered in the trades to register or in the list of non-approved crafts/ craft-like trades. By registering you will receive your craft and business card as well as a welcome folder with all the necessary information about your membership in the Chamber of Crafts and then you are entitled to the legitimate exercise of the respective craft.

Documents you need for registration:

Depending on the legal form of your company, various documents must be provided: 

Individual companies

• application for registration
• Credential
  
  

If, as a holder, you do not have a qualification to practice the craft but hire a manager, you will also need:

• Qualification certificate of the manager
• Proof of registration for social insurance
• Employment contract
  
  

Establishments that as Civil law

• Application for registration
• Proof of qualification of the respective partner
• social contract
  
  

If, as a shareholder, you do not have a qualification to practice the craft but hire a manager, you also need:

• Superintendent Policy
• Qualification certificate of the manager
• Proof of social security
• employment contract
  
  

Establishments that as GmbH, corporate company (UG) (haftungsbeschränkt), AG, OHG, KG, GmbH & Co.KG or other domestic and foreign companies

• application for registration
• Qualification certificate of the manager (can also be manager)
• Manager declaration (with employed manager plus employment contract and proof of social security, as well as proof of qualification)
• Commercial register extract
  
  

In all cases, the business registration can be submitted later, if an application has already been filed. Of course, this is all in addition to our comprehensive ''getting started'' guide - but as ever with German business, you have to be sure you are following the right rules. It is no secret Germany likes to make it a little puzzle when it comes to people accessing the rules and regulations but it is no secret that it can be done as long as you are committed to following the process through. We hope this has given you a comprehensive starting point to make the assessment for yourself!