Independent professional association

Definition and legal basis:

An independent professional association is a form of professional cooperation between members of the liberal professions. It enables freelancers to carry out their activities together without giving up their professional independence. This form of cooperation is not defined in law, but has developed in practice and is shaped by case law and professional regulations. Liberal professions include doctors, lawyers, tax consultants, architects, engineers and other independent scientific, artistic, literary, teaching or educational activities. The legal basis for professional associations can be found in the respective professional regulations and laws of the individual liberal professions.

Forms and structures:

Professional practice communities can be organized in various legal structures: 1. civil law partnership (GbR): The most common form, regulated by §§ 705 ff. BGB (German Civil Code).
2. Partnership company: Legal form specially designed for liberal professions.
3. Corporations: In some professions, GmbHs or AGs are also permissible. The specific structure depends on the specific requirements under professional law, which may vary depending on the profession.

Features and characteristics:

1. joint professional practice: the members practice their profession jointly and share resources, costs and income. 2. professional independence: each member retains their own professional responsibility and independence from instructions. 3. joint use of infrastructure: premises, staff and equipment are shared. 4. joint public image: the community acts as a single entity vis-à-vis clients or patients. 5. profit and loss sharing: The members share the financial results of their joint activities.

Foundation and formal requirements:

As a rule, the establishment of a joint practice requires: 1. a written partnership agreement
2. Compliance with professional regulations (e.g. approval by the professional chamber)
3. Registration with the relevant authorities and chambers
4. If applicable, entry in the commercial or partnership register The articles of association should regulate at least the following points:
– Purpose and duration of the partnership
– Rights and obligations of the members
– Distribution of profits and losses
– Decision-making and management
– Admission of new members and withdrawal of members

Liability and insurance:

Liability in a professional association depends on the legal form chosen: – In a GbR, the members are jointly and severally liable without limitation. – In a partnership company, liability for professional errors can be limited to the acting partner. – In the case of corporations, liability is generally limited to the company’s assets. Appropriate professional liability insurance is generally required by professional law and should cover the specific risks of the partnership.

Tax aspects:

The tax treatment depends on the chosen legal form: – GbR and partnership company: Transparent taxation; profits are attributed to the partners and taxed by them. – Corporations: Subject to corporation tax. Freelance activities are generally exempt from trade tax as long as no commercial activities are carried out.

Advantages and disadvantages:

Advantages:
– Synergy effects through resource sharing – Expansion of the range of services – Cost savings – More flexible working hours – Mutual professional support Disadvantages:
– Potential conflicts between members
– Restriction of individual decision-making freedom
– More complex organization and administration
– Possible liability risks for partners’ errors

Special features in various occupational groups:

1. doctors: Joint practices (formerly “Gemeinschaftspraxen”) are widespread and are subject to specific health insurance regulations. 2. lawyers: partnerships are a common form of cooperation, whereby professional confidentiality obligations must be observed. 3. tax consultants and auditors: Interdisciplinary cooperation is possible, but is subject to strict professional regulations. 4 Architects and engineers: Joint offices and planning companies are common forms of cooperation.

Current trends and developments:

1. increasing interdisciplinarity: cross-professional collaboration is gaining in importance. 2. digitalization: virtual professional communities and digital collaboration tools are changing working methods. 3. internationalization: Cross-border collaboration is becoming more common, but brings with it legal challenges. 4. work-life balance: Flexible working models in professional practice groups are becoming more important.

Summary:

Independent practice groups offer freelancers an attractive opportunity to benefit from the advantages of working together without giving up their professional independence. They enable synergies, cost savings and an expansion of the range of services. The specific structure must be carefully planned in order to comply with professional regulations and minimize potential conflicts. With the increasing complexity and interdisciplinarity of many specialist areas, professional practice groups are becoming more and more important and are constantly evolving to meet the changing requirements of the market and professionals.