External managing director (Fremdgeschäftsführer)
Also: Fremdgeschäftsführer, non-shareholder managing director
In short
An external managing director runs a GmbH or UG without holding a share in it. They are appointed by the shareholders and are subject to their instructions.
External managing director (Fremdgeschäftsführer) explained
The law expressly allows shareholders or other persons to be appointed as managing directors (Sec. 6 (3) GmbHG). A typical example is the employed manager in a family business or in a GmbH & Co. KG. The same requirements apply to them as to any managing director: a natural person with full legal capacity and no ground for exclusion under Sec. 6 (2) GmbHG. Because they hold no shares and cannot block resolutions, they are usually in dependent employment and therefore subject to social insurance. Salary, duties and termination are governed by the managing director's service agreement.
