Immigration Law: No residence permit for the intended activity of a foreign national as a hairdresser in a limited liability company (GmbH) with a hairdressing business.

Administrative Court of Ansbach, Judgment of December 7, 2010, Case No.: AN 19 K 10.01408

Case Background

The plaintiff, a Turkish national, filed a lawsuit against the rejection of his application for a residence permit in Germany, which was intended to allow him to engage in self-employment as a hairdresser. The plaintiff had already applied for a visa for Germany in 2006, but it was denied. In 2010, he entered the country with a Schengen visa, issued solely for a visit and business trip. This visa explicitly stipulated that the plaintiff was not allowed to engage in any form of employment. Nevertheless, shortly after his arrival, he applied for a residence permit to pursue self-employment based on his role as a shareholder in a limited liability company (GmbH) that operated a hairdressing business.

The plaintiff argued that his experience as a hairdresser and his expertise in oriental haircuts would make a valuable contribution to the German economy. He also planned to invest in a new hair salon, create jobs, and promote the training of apprentices. Despite these arguments, the competent immigration authority rejected his application, prompting the plaintiff to file a lawsuit.

Rejection of the Residence Permit by the Authority

The competent authority rejected the plaintiff’s application for a residence permit and set a deadline for voluntary departure, accompanied by a deportation warning. The rejection was primarily based on the fact that the plaintiff had entered the country without the necessary national visa, which is required for pursuing self-employment in Germany. The Schengen visa with which the plaintiff had entered only permitted a short-term business or visit and explicitly prohibited any form of employment.

According to § 5 (2) of the Residence Act (AufenthG), a national visa must be obtained before entering the country to pursue self-employment. This regulation ensures that authorities can review the applicant’s stay and planned activities in advance. The plaintiff, however, had not taken the necessary steps and had entered the country solely with a Schengen visa, which constituted a violation of entry requirements.

Additionally, the authority found that the plaintiff might have provided false or incomplete information when applying for his Schengen visa. According to § 55 (2) No. 1 of the Residence Act, this would be another reason to deny the residence permit, as it would be grounds for deportation.

Court Decision: No Prospect of Success

The court dismissed the plaintiff’s lawsuit and upheld the decision of the immigration authority as lawful. The court concurred with the authority’s argument that the plaintiff had no entitlement to the requested residence permit. In particular, the court stated that the plaintiff did not meet the requirements of § 21 of the Residence Act, which governs the granting of residence permits for self-employment.

Section 21 (1) of the Residence Act requires that the applicant’s self-employment must either serve an overriding economic interest or meet a specific regional need. Additionally, positive economic effects must be expected, and the planned investment must be financially secured. Although the plaintiff had announced an investment of 250,000 euros in the planned hair salon, this investment was deemed insufficient by the court. Furthermore, the amount was significantly below the typical investment volume of 500,000 euros required in such cases, as outlined in § 21 (1) sentence 2 of the Residence Act.

The court also noted that the mere acquisition of a business share by the plaintiff was not enough to justify a permit for self-employment. Moreover, it was unclear whether the plaintiff’s business would actually have the promised positive impact on the German economy, as the planned investment was neither convincing in its amount nor in its execution.

Conclusion: Visa Procedure and Its Importance for Foreign Entrepreneurs

A central point of the judgment was the importance of the visa procedure. According to § 5 (2) sentence 2 of the Residence Act, the requirement of a national visa may be waived in exceptional cases if the visa process would be unreasonable to complete. However, the court found no reason to apply this provision in the plaintiff’s case. It emphasized that adherence to the visa process must generally remain the rule to ensure that the regulatory mechanisms of the Residence Act are not undermined.

The court also pointed out that it is unacceptable for foreigners to create „fait accompli“ by entering the country with a Schengen visa. The plaintiff should have completed the visa process in Turkey before commencing his self-employment in Germany. The court made it clear that the provisions of § 21 of the Residence Act impose strict requirements on foreign entrepreneurs, particularly concerning the investment amount and the creation of jobs.

Ultimately, the court confirmed that the plaintiff had neither a right to the issuance of the residence permit nor that it would have been unreasonable to complete the visa process. The lawsuit was therefore dismissed, and the deportation warning remained in effect.

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