Civil law association (Gesellschaft bürgerlichen Rechts – GbR)

A civil law association (Gesellschaft bürgerlichen Rechts – GbR)
is a partnership which has no registered business name and
does not constitute an entity entirely separate from its partners.
However, the GbR as such may generally conclude contracts
and bear the rights and obligations thereof, and can sue and be
sued in its own name. All property acquired by the association in
its name is owned by the partners in joint tenancy. All partners
are jointly and severally liable for all debts incurred by the GbR
unless a liability limitation is agreed with each single creditor for
each transaction.

To set up a civil law association, at least two partners are
required to execute an association agreement. No registration is
required. Possible partners can be either individuals, German or
foreign corporations, or commercial partnerships or other civil
law associations.

The legal relationship between the different partners is deter-
mined by the rights and obligations agreed upon in the associa-
tion agreement. Unless otherwise agreed, the GbR is managed
and represented in and out of court by all partners, and each
transaction requires the consent of all partners.

A civil law association is typically used for non-commercial
purposes (e. G. Associations of professionals) and for individual
transactions or contracts (e. G. Construction projects), in most
cases for a limited period of time.