Alexander Von Engelhardt: What you can expect from the German economy is that your business will be absorbed. It is needed and wanted. What I do for you is to make your wish come true. I don't listen to your exact ideas as you first tell me but develop it into a successful promise for the authorities. That usually made me successful in the past, and look forward to helping other clients to be successful in Germany.

Salman Siddiqui: Welcome to the Investment Immigration podcast by Uglobal.com, with weekly in-depth interviews with the world's leading investment immigration professionals.

Welcome to another episode of the Investment Immigration podcast brought to you by Uglobal.com. I'm your host, Salman Siddiqui. Today we are going to talk about changes in Germany's immigration laws and how does that impact the opportunities for investors, entrepreneurs, and skilled workers from around the world. So, a lot has been happening in Germany lately. The government, the coalition government that is in place has been talking about major reforms to attract more foreign skilled workers from all over the world. It's talking about providing more opportunities for people who want to start businesses, you know, bring their talent to the country. The parliament recently talked about the opportunity card. So, we're going to talk in this episode. What is that all about? We're also going to talk about whether these changes are coming into the immigration reforms in the country, and whether they will be there for a long time or not because there is also opposition to these laws. So, to understand all of this, I have a very special guest from Berlin today. His name is Alexander Von Engelhart. He's a solo entrepreneur. He's a founder of his own law firm here in Berlin. So welcome to the show, Alex.

Alexander Von Engelhardt: Thank you. Nice to meet you as well. I'm happy for the invite.

Salman Siddiqui: Thank you. So, Alex, let's start with the big elephant that has recently happened here. So, Germany's parliament recently approved a new opportunity card, which it says is aimed at attracting foreign talent. Can you explain how the system works and what its aims are to attract skilled workers from outside Germany?

Alexander Von Engelhardt: Well, the opportunity card is not so much for workers not living yet in Germany. It targets asylum seekers or persons in the process of being accepted as an asylum before being granted asylum. And the target is to simply give them a second chance to legally reside in Germany by putting aside the asylum process, which might take a lot longer. Time is very complicated to really get to an end and to put them to work and to meet the German economy's need for employment.

Salman Siddiqui: So, this opportunity card has nothing to do with foreign entrepreneurs or foreign businesspeople or, you know, skilled workers who want to come to Germany. So, if you could explain the opportunities that are there for foreign entrepreneurs and skilled workers, is there a law already in place in there, or are we going to see more changes?

Alexander Von Engelhardt: Gladly. Foreign investors are generally welcomed, and it is seen in corporate law. There's no issue. Every foreigner may have shares in a company, every share foreigner may be a director in the company. So far, so easy, so clear. However, the catch are banks. German banks are very anxious to have a German company or a German client with foreigners not living in Germany. And that means virtually the company will not get a bank account. However, as a solution provider, I have my company in Germany that provides ready-made companies that come with a bank account, and in the end, the foreigner wanting to not live in Germany can keep the account and so make business here in Germany that will work. Skilled employees are generally also welcomed. They just need to have the right credentials and have a job and sufficient salary, and that's it.

Salman Siddiqui: You know, in many parts of the world, they have this thing called the Golden Visa program, where one can buy through investment in property or investment in a business. They can get residency. Germany doesn't have that at the moment. But do you think with the way the immigration laws are being reformed, that means at least a component of gaining residency through investment would be on the cards in the near future?

Alexander Von Engelhardt: I doubt it because Germany started in 2015 with a 1 million promise turnover and ten employees, and then you would get permanent residency from scratch, reduced it over the last years, and now it's that value has been abolished. And I seriously doubt that entrepreneurs will get such golden visas. However, German authorities want to reach out to investors and privilege them, in contrast to employees, and so far that they give a fast-track permanent residency. But after three years, the requirements for this fast track, permanent residency, are not very complicated. You just have to show success in your business and have sufficient health insurance and your income. Personal livelihood is secured via the company's business.

Salman Siddiqui: And that's what I want to understand from you. Like I can see already examples in Berlin where, you know, there are some residential properties which are owned by foreign investors. They may not necessarily be living here. So that option of buying property in Germany as a foreign investor is already there, isn't it?

Alexander Von Engelhardt: It is. You do not need to be in Germany to have and run a company. You don't even need to come to Germany if you want to open a company. Sufficient powers of attorney as a rule. Suffice for that already. So let me say the comfy investor sitting, for example, in Malaysia wants to expand his business over to Germany. He may remain lazy to sign a power of attorney, visit a consul maybe once or twice in his hometown, and that be it. Then he can run the business from home and never touch German soil.

Salman Siddiqui: What do they get in return? Apart from the investment in real estate? Do they get residency in return? They don't get that, do they?

Alexander Von Engelhardt: No. Real estate investment or residency via real estate is not interesting for investors permit. What the German authorities want is sounds very simple but may not be so. They want you to bring momentum to the German economy. That is when your business idea is interesting. To help other German companies make more and better business, then you'll be welcomed as an investor to live here.

Salman Siddiqui: So, Alex, now I want to also understand from you, if you could give our listeners a sense of what the German government is trying to do in terms of opening up the market to foreign investors because they are talking about more immigration reforms, but it seems like it's more targeted towards just attracting foreign skilled workers at this point, correct?

Alexander Von Engelhardt: Currently, the government is focusing on skilled workers to cover the very vast labor market here in Germany. There are too many companies crying to serve their business and not finding anybody. And that is where the focus is.

Salman Siddiqui: If somebody, a foreign investor, wants to set up a business in Germany, what is the process like? If you could walk us through.

Alexander Von Engelhardt: Sure. The formality is that he produces a business plan with a profit and loss forecast for the next few years. And inside that, he develops what his benefit for the German economy will be. Let me share two simple examples. What turned out to be successful; I had once a young Russian gentleman, filthy rich and living in the States. He could easily show that he had 1 million USD here, and another 600,000 USD over there, and he was turned down at first approach and what he wanted to do was social media. The German authorities said social media doesn't sound interesting to us. But they said, okay, why don't you open your server farm here to cater to the needs of your business here and hire a few persons and then do it in surplus since he has sufficient funding and then rent out your facilities for a cheaper price to other small German companies that they can expand more cheaply and not having to invest themselves well. Bingo. That worked out. And another case was an Indian graduate. He wanted to do export import. Nobody is interested in that. Every Indian wants to import and export Ayurveda products. But he did some more homework. He learned about cough drops. Cough syrup was needed here in Germany. There's a strong shortage of that. He found some Indian suppliers and made it look like Ayurveda or whatever in this regard. Started investing in that too. Then his business plan, including that, went through very quickly.

Salman Siddiqui: So, in terms of what you're seeing currently, what are you seeing in terms of the timeline? Can one get a business-based residency in the country within one year, or does it take even more? And how does that get complicated? One wants to bring their family also.

Alexander Von Engelhardt: Well, considering your bureaucratic worries. Yes,  bureaucracy in Germany is a nightmare. Yes. They love forms. They love their forms. They want their forms. They demand their own individual forms. They can't get enough of forms. Heck, yeah, but that's reality. And tell me which country doesn't have a similar bureaucracy with similar nightmares. But we're not here for nightmares. We want to inform your listeners. When coming to Germany, I look towards a half year until they have their latest entry visa, and settle down in Germany, and it is normal from German understanding. It is normal and understood and expected that they bring their whole family with them. That is the dependent visa, as they are typically called. I call them family reunion permits. They automatically come with the spouse as the breadwinner. The family is a piece of cake once the breadwinner has got his permit or entry fee. So, typically, I get them in around two and a half years. That includes the preparation time and chasing the authorities.

Salman Siddiqui: So, let's talk about, you know, the kind of business plan that usually is successful. You gave us some good examples, but if you could explain a little bit more about what exactly German authorities are looking for there?

Alexander Von Engelhardt: Well, let me start with a wisecrack response. What the German authorities do not want is sex, drugs, and rock and roll. Of course, everything that is fun is not wanted. Okay. But yeah, what they are typically interested in is sort of broad digitization, cybersecurity, anything around that is needed or something for the infrastructure that could be needed like engineering companies or Green Power. Recently, I was talking to a gentleman from Ghana who was considering possibly investing in Germany with bricks, including solar panels already. That was kind of thrilling. But he's still considering collecting his business assets and describing them around that. He would be very welcome in Germany. I don't know what his issues are. Germany would welcome him very gladly, especially with the current government that we have with the Greens in the Ministry of Economy. They want to foster green energy, and renewable energies as much as possible.

Salman Siddiqui: What will we see more in the near future? Do you expect more immigration-related reforms? There's a lot of talk about changing even the country's citizenship and naturalization laws recently. Is it something that is happening this year now?

Alexander Von Engelhardt: This will not typically. Well, the new immigration law for employees has started this year and will completely be ruled out by next year. Citizenship is still a bit of an issue. They haven't yet passed a law, but still are discussing it heavily, and the factions are, more or less, opposing each other on a mutual basis. And I don't see where this will go because when it comes to obtaining German nationality, what is the foreigner trying to reach? Germany's most holy grail, the German nationality, and Germans are a bit anxious, you know, the German angst, and they're reluctant to give up, to give this Holy Grail over to somebody else who is not uniquely German. They're anxious.

Salman Siddiqui: If you could explain how under the current process, the naturalization process works, like, for example, you gave the example of somebody who gets residency based on their business that they want to set up. It's a three-year residency. So, suppose somebody comes through that route to the country, establishes a business, and is doing okay. How much time does it take before they get permanent residency and then naturalization? Under the current laws.

Alexander Von Engelhardt: Under the current law, an investor will get permanent residency after three years. Providing that his business is successful, it has health insurance, and its personal livelihood and that of his family is provided by the company. That is quick and easy citizenship. The rule is eight years of residency in Germany, having sufficient income and, of course, no criminal records, and making an oath to the German authority to foster the German democratic free order here. And most, of course, is also the integration that is B1 German and passing a citizenship test. That is the rule. The exception, the short, fast-track approach is after seven years, if you've passed an integration course as well, and six years when you come up with B1 German.

Salman Siddiqui: And what's happening now in the current debate in the German parliament? Is it they want to cut down this naturalization timeline to about five years, isn't it?

Alexander Von Engelhardt: Five years. Also waiving the requirement to give up one's previous nationality, which is currently the rule.

Salman Siddiqui: So the dual citizenship law is also being talked about, a reform there where people can hold multiple citizenship because, at the moment, you have to renounce your citizenship unless your country has a bilateral agreement of some sort, isn't it?

Alexander Von Engelhardt: Yes and no. Well, the rule is correct, you have to renounce your nationality. But there are exceptions. They are typically when this country does not know this possibility, to renounce one's citizenship, which is not very much, or when it's especially a financial hardship that cannot be buried, for example, not as an example, not really matching our clientele today, but a normal employee having US citizenship can easily work around this situation of having to renounce the US citizenship because the US government expects a 2,300 USD fee to renounce US citizenship and a normal employee making around the same amount of income for that person would be an undue hardship and they could waive that requirement. When it comes to investors, the value is around a quarter of one's monthly income. So, if the investor has a formal income of around 2,000 USD from his company being an American now, that could work then because it's only his personal income that counts.

Salman Siddiqui: I also now want to understand from you the trends that you're seeing from your clients. So, when a foreign investor or an entrepreneur comes to Germany on a visa, what are they typically looking for? Is it for short-term residency that they just want to be there for three years, maybe, and then move on to another destination? Or do they actually want to relocate with their families? Or does that vary from country to country? If you could share some trends with us.

Alexander Von Engelhardt: Sure. When coming to Germany, this global or nomad visa is an unknown concept. German authorities expect and anticipate that the investor, including its family, relocates to Germany like to reboot and plant oneself at home, replanting oneself in Germany to live here for good. That's a German of that understanding. Of course, Germany is a free country. You're allowed to travel for up to six months in a row to be abroad. But this is the general German understanding. Some nationalities love to work around this by typically considering Germany as a backup residency, which German authorities frown upon. And there are ways to do it to get around that typically fly in for one or two days, depending on whatever, and then return back home. Once this is noticed, German authorities typically cancel or shorten the existing permit.

Salman Siddiqui: That's what I want to understand from you. Like, for example, once somebody gets a residency here when they enter the country, is there a requirement to stay within the country for a certain amount of time within the year, like six months? Is there any kind of requirement like that?

Alexander Von Engelhardt: Well, the German law does not think how much time you have to be here. It's more the vice-versa approach. How long may you be out until your permit expires? That's the way Germany thinks. You're generally allowed to leave the country for business purposes, be abroad here and there, and nowhere but only up to four, six months in a row. If you are constantly, like, say, a normal businessperson, though, having family here in Germany, is constantly traveling. That ought not to be an issue if you are a sole business holder, only seldom in Germany. That's where issues can start.

Salman Siddiqui: Let's now also talk about the visa for skilled workers, which is something that the current government is really pushing, as we mentioned earlier in the podcast. So, if we could explain to me what kind of skilled workers Germany really needs or the German government wants.

Alexander Von Engelhardt: I'll try my best because it's a wide topic. Generally, there's a high demand for unskilled persons having qualifications to serve Germany. Most wanted our truck drivers, but even more health professionals, nurses, physicians, and also it you could see a heart needs and Germany having the coming from their own tradition, expects every candidate to have a fully-fledged training. But this is not reality typically, the American career is that you get some kind of education learned on the job, and bingo, your master whatever then recently, I helped a senior IT professional from the US Marines who wanted to settle down in private business here in Germany. Until recently, he was in dire straits to getting the permit because he had no diploma from a university not even in mathematics. How could this happen that he was still a senior IT consultant in the US Marines? Well. Hi father had an IT store or a computer store, and he tinkered with computers from the age of six onwards and played around with broken computers at six. We're trying to repair them as a teenager, starting writing for school and so on and so forth. And nowadays, this person, well, he won't get a blue card, but he still gets a permit residency. Other employment reasons, as it is called here, he can show reference letters from previous employees or current employer as an employer that he has such experience in his profession that he's not a dreamer, but he's a really doing person, and that will work. Or if you have something in between, there's a big need for that. Then they will also give you that exemption.

Salman Siddiqui: So, the reforms that the current government has debated in the Parliament and which has I think already been approved, does that solve this kind of problem? Because from what I understand is that there are points for language skills, ties to Germany. And there's a whole you know, like you mentioned, the degrees. You know, you have to have a certain degree which is recognized by Germany and then you can become eligible for, for example, the blue card that you mentioned, which is only given to a certain class of skilled workers who are considered highly skilled.

Alexander Von Engelhardt: Isn't it sort of as a rule, German language is not needed to start a residency here in Germany. As a rule, the exceptions are not in immigration law, but in professional law. Physicians, for example, they need C one, nurses need B2 German, otherwise they will not be allowed to to run their profession here. But immigration law doesn't say you must have German. They only say you need as much German as your job requires you to have. So for an IT guy is another example. He doesn't have to speak German at all, but for practicality reasons at least English would be required. And not only Hindi or Russian or whatever then. So that's where German and Blue Card does not require that blue card only requires that a that a person has an academic training diploma is acknowledged in Germany and income levels. That is what it's needed.

Salman Siddiqui: So what has happened now in terms of the reforms for attracting more skilled workers, what has changed then? Presumably they made the process easier to attract more people to come to Germany, isn't it?

Alexander Von Engelhardt: It is. It will make the process easier because they're reducing the requirements. A blue card holder will only be a person who has an academic training, but the salary requirements will be considerably decreased. Now they're up to 7500 roughly, and then it's going down to five, something like that. And they're still thinking around that. Now for I.t professionals, they already only have a reduced salary amount but then they need approval from the Labor agency that has will is to be abolished now.

Salman Siddiqui: Right. And we're coming close to the end of our episode. But before I let you go, I also want to understand from you is what is to be expected in the near future in Germany in terms of changes to its laws, in terms of attracting more investors. What's on the cards? What are you hearing? And there is another thing I wanted to add to that is, you know, there's a perception that maybe the changes that are currently taking place might not last for long because everything is kind of changing very rapidly in Europe. So if you could explain an outlook for the future, how would you see the coming months and the coming years?

Alexander Von Engelhardt: Let me say it this way. I have the hope that the current government can put down its policies and more understanding and more persuasion to it because they have good ideas, but they're not really addressed to brought to the understanding of the population. That is what I personally perceive and my future outlook for the future is typically that the government will do its homework and bring stability to the German country. And so to keep down a position, typically such a position which is not positive for the economy or for generally for life.

Salman Siddiqui: But do you think more changes to the immigration law to attract more foreign investors and entrepreneurs would take place this year or the next?

Alexander Von Engelhardt: My argument is more that more changes are not really needed. Germany's not doing that bad in immigration law, but the offices themselves have to do their homework. They have to get digitized and streamlined. Work more to flow stream flow because right now they're disorganized. They seriously love paper forms, as previously mentioned, but they want them on paper. They really want paper because only what they have in their hands, what they touch and feel and smell something real for them that cannot be scanned and sent over per email to the colleague. And let me from let me see New daily now to Berlin. No, it has to be done by snail mail, by courier post, and that only goes out once a week, and then it goes to a central office here in Germany. The central office opens a parcel, and distributes everything and nothing to the allegedly competent authorities. Something, something gets lost. Sometimes it goes to the wrong office, and then it has to go back to the central office and there and that. And to boil it down, Germany still loves its paper much too much. And if that could be reduced, the amount of paper would help a lot, and to streamline the work and digitize it more, they could accept, for example, PDF copies of the front that they could do their vetting based on that. And if they have doubts, okay, respect it, then ask for the paper and get it certified and whatever else they need to be persuaded would do a lot already.

Salman Siddiqui: So before I let you go, Alex, I'll give you 30 seconds to make your pitch to our foreign investors who are listening to the show about what they need to look forward to in Germany and why you think Germany is the perfect place for their investment, whether it's setting up a business or investing in another business. So please go ahead and make your pitch.

Alexander Von Engelhardt: Thank you so much. Well, I welcome you to Germany because it's a great place to live here. Germany has a very strong culture. It's cool. And according to your religion, it has the best beer in the world. And the German way of life might be somewhat difficult. But on the bottom line, it really is grand to be here. And what you can expect from the German economy is that your business will be absorbed. It is needed and wanted. And what I do for you is to make your wish come true. I don't listen to your exact ideas as you first tell me but develop them to a successful promise for the authorities. And that usually made me successful in the past, and I look forward to helping other clients to be successful in Germany.

Salman Siddiqui: Thank you so much, Alex. And you know, I'm really appreciate you for taking out the time to explain the changes that are happening in Germany's immigration laws and how they are opportunities for investors and foreign entrepreneurs. So thank you again for joining the podcast.

Alexander Von Engelhardt: Thank you so much as well, and all the best.

Salman Siddiqui: And in the end, I'm going to shout out to our listeners that please stay tuned to our show. We'll be bringing you guests from around the world to discuss more opportunities for foreign investors around the world. Thank you. You've been listening to the Investment Immigration podcast by Uglobal.com. Join us again soon for more in-depth conversations exploring investment immigration opportunities from around the world.

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