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ARTICLE · 01 MAY 2023

Lending & Secured Finance Country Comparative Guide 2023

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Originating loans to German borrowers requires a licence under German law, a European passport or an exemption from German licence rules.

GermanyInsolvency/Bankruptcy/Re-Structuring

1. Do foreign lenders require a licence/regulatory approval to lend into your jurisdiction or take the benefit of security over assets located in your jurisdiction?

Originating loans to German borrowers requires a licence under German law, a European passport or an exemption from German licence rules. No licence is required if a lender acquires fully drawn term loans (while certain changes to an existing loan may give rise to licence requirements, such as the extension of the maturity of a loan). Under particular circumstances foreign lenders may not require a licence when lending to German borrowers; this includes, inter alia, that lenders do not actively approach the German market.

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