In a nutshell: On 10 December 2025, the German Federal Government passed a draft bill on "Amendments to flag, ship registration and sea fishery regulations".

Flag law, ship registration law and sea fishery law shall be modernised, made less bureaucratic and adapted to digitisation. One of the Federal Government's aims is to make the ship registration under the German flag more attractive. Initially proposed restrictions on EU companies which were included in the draft bill from September 2025 would have had a significant impact on leasing structures. These restrictions are no longer included in the updated draft bill.

Attractiveness of the German flag 

The actual goal of making the German flag more attractive was briefly at risk: the draft bill from the Federal Ministry of Transport from September 2025 provided that the voluntary flying of the German flag, which is currently possible for all EU companies, should in future only be open to EU companies whose (i) authorised representative body is composed of a majority of EU citizens and (ii) shareholders are predominantly EU citizens or EU companies, which in turn are predominantly represented by EU citizens. That regulation would have impaired typical leasing structures and complicated new structures. Currently, lessors can be registered as the (legal) owners of seagoing vessels in the German ship register without meeting these requirements by using finance vehicles based, for example, in Malta, Cyprus or Ireland. This currently allows the lessee and beneficial owner of a ship to operate the ship under the German flag or flag her out, but above all, this means that tonnage taxation can generally be applied. The introduction of the two additional criteria would have shifted the parameters for all parties involved in such leasing structures, making it less attractive to register ships financed in this way in the German ship register. Furthermore, September's draft bill did not provide how the legislator intended to deal with existing structures that did not meet the additional criteria. After its publication in September 2025 our firm pointed out the weaknesses of the draft bill and the risks for leasing structures. In the draft bill of 10 December 2025 the two additional criteria have now been deleted without replacement.

Modernisation of the Flag Law

Another aim of the draft bill is to modernise German flag law. The Federal Government wants to clarify responsibilities, make regulations more comprehensible, close regulatory gaps, repeal outdated and no longer relevant regulations and reduce bureaucracy. To this end the draft bill would abolish the ship pre-certificate (Schiffsvorzertifikat). For the shipowner's consent to flagging-out notarisation would no longer be required. The requirements for the so-called "authorised person" in Section 5a of the Flag Law Ordinance (Flaggenrechtsverordnung) would be simplified.

Digitalisation

The ship register is public by law. Anyone is permitted to inspect it. No special authorisation is required for inspection. However, such inspection has so far to take place in person. It is therefore to be welcomed that in future inspection will be possible digitally. However, according to the draft bill, it will be left to the federal states to enable digital inspection. Although this is a restriction, it is consistent with the current situation if one considers that the ship registers are not yet kept electronically across the board.

Fisheries

The draft law also includes amendments to the Sea Fisheries Act, which serve, among other things, to implement European Union requirements. 

If you have any questions, please get in touch with your usual contact person at EHLERMANN RINDFLEISCH GADOW or Dr Carolin Schmeding or Dr Stefan Rindfleisch.