The law on associations is an important aspect of civil law in Germany and regulates the establishment, organisation and management of associations. Associations are a central element of social life and offer people the opportunity to pursue common interests and goals.

In this comprehensive blog post, we will look at association law in detail, including the formation, liability, rights and duties of members and governing bodies, as well as the dissolution and liquidation of associations. We will also look at current laws, court rulings and frequently asked questions to give you a comprehensive understanding of association law.

Basics of association law in Germany

Association law in Germany is regulated in the German Civil Code (BGB), in particular in §§ 21-79 BGB. There you will find the essential provisions on the foundation, organisation and management of associations. Associations can be founded as legally capable associations (e.V.) or as non-legally capable associations (nicht e.V.). Associations with legal capacity are legal persons and can therefore be bearers of rights and obligations. Associations without legal capacity, on the other hand, are not legal persons and are therefore treated as communities of joint ownership.

Legally capable association (e.V.)

An association with legal capacity (e.V.) is an association that is entered in the register of associations and is thus considered a legal person. The advantages of legal capacity include:

Liability of the association and not of the individual members
Contracts can be concluded in the name of the association
Property and asset rights can be transferred to the association

Non-legal association (not e.V.)

A non-legal association is an association that is not entered in the register of associations and is therefore not considered a legal entity. This has the following consequences:

The members are personally liable for the association’s debts
Contracts must be concluded by the members personally
Property and asset rights can only be transferred to the members

Formation of an association

The formation of an association requires compliance with certain legal requirements and procedures, which are explained below.

Requirements for the formation of an association

The formation of an association requires that:

At least seven natural or legal persons are involved (§ 56 BGB)
A common purpose is pursued that complies with the provisions of the BGB and the law on associations
A statute is drawn up that meets the legal requirements (§ 57 BGB)

The articles of association

The statutes are the basic document of an association and should contain the following information:

Name and seat of the association
Purpose of the association
Membership details (admission, rights and duties, termination)
Organs of the association (board, general meeting, etc.)
Rules on liability and dissolution of the association

The founding meeting

The founding meeting serves to adopt the statutes, elect the board and pass a resolution on the entry of the association in the register of associations. The founding meeting should be minuted and the minutes should be signed by at least two founding members.

Entry in the register of associations

In order for an association to acquire legal capacity, it must be entered in the register of associations. For this purpose, the following documents must be submitted to the competent district court:

Application for entry in the register of associations
Minutes of the founding meeting
A certified copy of the association’s statutes
List of board members

After examination by the Local Court, entry in the Register of Associations and publication in the Federal Gazette.

Organs of the association

The organs of an association are central elements in the management of the association and decide on the fate of the association. The most important organs are the executive board and the general meeting.

The executive committee

The executive board is the governing body of an association and represents it externally (§ 26 BGB). The composition and powers of the executive board must be laid down in the statutes. Usually the executive board consists of a chairperson, a deputy chairperson and a treasurer. The tasks of the board include:

The management of the day-to-day business of the association
Implementing the resolutions of the general meeting
Preparing and convening the general meeting
The preparation of the budget and the annual report
Deciding on the admission and exclusion of members

Board members are usually elected by the General Assembly and have a term of office of usually two to four years. The liability of the Board is generally limited to intent and gross negligence (§ 31a BGB).

The general meeting

The general meeting is the supreme body of an association and consists of the members of the association. It has the following tasks in particular:

Election and deselection of the Executive Board
Discharge of the Executive Board
Determination of membership fees
Amendment of the Statutes
Dissolution of the Association

The General Assembly shall be held at least once a year and shall be convened by the Executive Committee. The meeting shall be convened in writing, giving at least two weeks’ notice and stating the agenda. Resolutions of the General Assembly shall be passed by simple majority, unless the Statutes provide otherwise. A qualified majority of at least two thirds of the members present is required for amendments to the Statutes and the dissolution of the Association (§§ 33, 41 BGB).

Rights and duties of members

The members of an association have both rights and duties arising from the legal regulations and the statutes. The most important rights and duties are:

Members’ rights

The rights of members include in particular:

Participation in the general meeting and the right to vote
Information on the affairs of the association
Use of the facilities and offers of the association
Influence the management of the association through motions and complaints

Duties of the members

The duties of the members include in particular

Payment of membership fees
Compliance with the Statutes and the resolutions of the General Assembly of Members
Promotion of the purposes and interests of the Association
Compliance with the orders of the Executive Committee

Liability in association law

Liability in association law is an important issue, as it affects both the association itself and its members and organs. In principle, an association with legal capacity (e.V.) is liable for its obligations and not the members. In the case of associations without legal capacity (not e.V.), on the other hand, the members are personally liable.

Liability of the association

An association with legal capacity is liable for its liabilities with its assets. This includes in particular:

Liabilities arising from contracts
Claims for damages
Tax and social security debts

The liability of the association is not limited to the assets of the association, but extends to the entire assets of the association, provided that these are sufficient to cover the liabilities.

Liability of members

The members of an association with legal capacity are in principle not personally liable for the association’s debts. However, exceptions may arise from the statutes or from statutory provisions, for example in the case of wilful or grossly negligent conduct.

In the case of associations without legal capacity, however, the members are personally and jointly and severally liable for the association’s debts.

Liability of the organs

The organs of an association, in particular the executive board, are in principle only liable for intent and gross negligence (§ 31a BGB). However, more extensive liability may arise from the articles of association or from statutory provisions, for example in the case of breach of fiduciary duties or breaches of tax law.

In addition, members of the executive board may be personally liable to the association if they culpably violate their duties and the association suffers damage as a result. In such cases, the association may assert claims for damages. However, a limitation of liability to intent and gross negligence is also possible here, provided that the statutes provide for this.

Termination of membership and dissolution of the association

Membership in an association can be terminated in various ways, and the association itself can also be dissolved. The most important regulations on this can be found in the BGB and in the association’s articles of association.

Termination of membership

Membership in an association can be terminated in the following ways:

Resignation: Resignation is possible at any time, unless the statutes provide otherwise (§ 39 BGB). Resignation must be declared in writing to the Executive Committee.
Death: Membership ends with the death of the member.
Expulsion: A member may be expelled from the Association for good cause. The reasons for exclusion shall be laid down in the Statutes and may be, for example, non-payment of membership fees or a serious breach of the interests of the Association. The exclusion shall be decided by the Executive Committee or the General Assembly and the member concerned shall be notified in writing.

Dissolution of the Association

An association may be dissolved if:

The general meeting decides this with a majority of at least two thirds of the members present (§ 41 BGB)
The purpose of the association has ceased to exist or can no longer be achieved
A court order or administrative act provides for dissolution

In the event of the dissolution of an association, the assets of the association, after deduction of liabilities, shall be donated to a charitable or other tax-privileged purpose. The general meeting shall determine the specific use of the assets and appoint one or more liquidators to carry out the liquidation of the association.

Current developments and court rulings

The law governing associations is subject to constant development and change, particularly as a result of changes in the law and court rulings. Some current topics and rulings in association law are:

Data protection in associations

With the introduction of the European General Data Protection Regulation (GDPR) in 2018, associations are also obliged to comply with data protection regulations. This concerns in particular the processing of personal data of members and the appointment of a data protection officer, if required.

Ruling of the Federal Supreme Court on the liability of the executive board

In a judgment of 18 February 2020 (Case No. II ZR 193/18), the Federal Supreme Court ruled that the executive board of an association is not personally liable for damage caused by a member of the association if the executive board has not committed a breach of duty. This further limited the liability of the board and clarified that personal liability only exists in cases of intent or gross negligence.

FAQs on association law

Below you will find answers to frequently asked questions on association law:

Can an association be founded without being entered in the register of associations?

Yes, an association can be founded as an unincorporated association (not e.V.) without being entered in the register of associations. However, in this case the members are personally liable for the association’s debts.

Can legal entities become members of an association?

Yes, legal persons can become members of an association, provided the statutes allow this. In this case, the rights and obligations of membership apply accordingly to the legal person.

Can an association operate for profit?

In principle, an association can also operate for profit, provided that the statutes provide for this and the purpose of the association is not exclusively charitable. However, tax disadvantages may arise if an association is not recognised as a non-profit organisation.

How can a board member be dismissed?

A board member can be dismissed by a resolution of the general meeting. The statutes may provide for special rules and conditions, such as a qualified majority or an important reason for dismissal.

How can association members be released from liability for association debts?

Association members can be exempted from liability for association debts by founding the association as a legally capable association (e.V.) and entering it in the register of associations. In this case, the association itself is liable for its debts and not the members.

The law on associations in brief

The law on associations in Germany is an important area of civil law and regulates the formation, organisation and management of associations. The formation of an association requires compliance with certain requirements and procedures, in particular the drafting of articles of association and entry in the register of associations. The organs of an association, such as the executive board and the general meeting, are central elements of association management and contribute to the implementation of the association’s purposes.

Liability under association law affects both the association itself and its members and organs and is limited to the association, especially in the case of associations with legal capacity (e.V.). Termination of membership and dissolution of the association are also important aspects of association law and are subject to legal regulations and specifications in the statutes.

Association law is constantly changing and is subject to new developments and court rulings that have an influence on the practice of association management. Knowledge of the current legal situation and consideration of the legal requirements and procedures are therefore essential for the successful foundation and management of an association.

Association law: Formation and management of associations in civil law