Legal and economic implications of the German Craft Code Amendment 2004

Abstract

As the main reason for initiating an amendment of the Trade and Crafts Code in 2004 was the decrease in the number of companies in general and the number of skilled crafts enterprises in particular and was also due to the fact that the number of employees in the skilled crafts sector had constantly fallen and many companies were not able to find a successor, it was the declared aim of the amendment to counter this structural crisis as well as reducing illegal employment and removing native discrimination. This would then ensure a higher level of employment especially through new company formations and takeovers of existing companies.In addition to providing an important contribution towards the assessment of the basic success of the 2004 Trade and Crafts Code amendment, the results can therefore be used at an international level for discussions on skilled crafts legislation outside Germany. As German skilled crafts legislation developed in a completely different manner from skilled crafts legislation in most other European countries, this aspect is particularly significant and it is conceivable that the results will be useful beyond the borders of the Federal Republic of Germany. The research findings will also be important in determining the limits of deregulation and when it can be considered counterproductive from an economic point of view.