Itinerant Business and Market Sales

Definition, Explanation

The itinerant business is a business activity that requires no business premises and can take place outside a business branch. The itinerant trade used to be called hawking or peddling. Typical itinerant trade activities are the doorstep sales of goods and the commercial operation of a sales stand at jumble sales, with the objective of making a profit.

Selling goods at markets represents an important way of making an income or a secondary income nowadays. According to §55 GewO (Industrial Code), a person operates an itinerant business, who does one of the following in a commercial way without taking orders in advance and outlying his commercial branch, or not having one:

Independently or dependently on his own account, peddles goods or distributes orders or buys services like activities of craftsmen or accepts orders or contracts for services or
Performs entertaining activities as an actor or like a showman
Anyone operating an itinerant trade needs proof of authorisation in the form of an itinerant business permit. This is issued by the local authority. In the case of having been previously convicted, lacking reliability or police supervision, they can refuse to issue an itinerant business permit.
For the actual pursuance of itinerant trade, one always has to obtain permission to have a stand on site. This usually happens through authorities, organizers as well as companies and is usually subject to a charge.

Tips, Checklist

Many activities can be carried out as an itinerant trade that are as "general business", i.e. with business premises, only permitted by means of a permit or proof of skills like a master craftsman certificate and registration with the register of qualified craftsmen. Operating handicraft stands at corresponding markets, however, does not require such permits
The company registration office can issue the itinerant business permit for one or several years or for an unlimited period. The charges vary correspondingly. You can enquire about these. The application is, however, much more time-consuming than in the case of registering a company. You require: a photo and your ID card, a tax clearance certificate from the tax office, a police clearance certificate from the registry office, an excerpt from the debtor's registry from the registry court, information from the central company registration and in the case of foreigners, a residence permit
The holder of the itinerant business permit must always have the permit on him and is controlled by the trade supervisory centre every now and then
Itinerant businesspersons become a member of the Chamber of Commerce after registration. They have to keep record of their income and expenditure by means of a statement on excess of receipts over expenses for their tax declaration. An itinerant business permit must be applied for even for further employees like at sales stands
There are a lot of itinerant "peddling" activities that require no itinerant business permit. Those salespersons, which occasionally offer goods at exhibitions, fairs and public events or on special occasions – with an official permit (!) – require no itinerant business permit. §§ 55 a and b GewO are the basis for this. As well as that, autonomously produced agricultural and silvicultural products like fruit and vegetables may be "freely" sold within one's own township or business branch. Yet, this only applies to townships with no more than 100,000 inhabitants. Furthermore, mobile kiosks are allowed to operate without an itinerant business permit. See §§ 55a, section 1, sentence 9 GewO for more information. As well as that, bookstalls on streets or in places can be operated without a company registration – see §55a, section 1, sentence 10 GewO. Authorities can also exclude certain sales events from the itinerant business permit obligation according to §55a, section 2 GewO.
According to some authors like Martin Massow – Freiberufler-Atlas (Freelancer-Atlas), p. 186, one can derive from §70 section 1 GewO that a businessperson can participate in events like folk festivals, large markets, weekly markets, special markets, fairs and exhibitions without an itinerant business permit. All the businessperson has to do in this case is to follow the organiser's rules and can thus offer services and goods. According to Massow, the participants of esoteric fairs or knights markets, for example, only have to follow the organiser's rules and do not require in these cases a company registration or an itinerant business permit. This opinion is being discussed very controversially
Important: the statutory regulations and requirements regarding the registration of a business or an itinerant business, especially in the case of selling on special markets, are obviously construed variably from region to region. It is thus advisable to enquire at the business registration authority before participating in a market. On having no permit, this can be regarded as a public offence
The operating of private sales stands at jumble or car boot sales to sell private possessions definitely does not require a permit
Itinerant businesspersons are obliged to pay business tax. This is regulated in § 35a GewStg (Industrial Tax Code)

Last update: 05/02/2010