On January 1, 2026, Germany quietly enacted a law requiring all men aged 17–45 to get Bundeswehr permission before leaving the country for more than three months. The provision attracted zero public debate during its passage through parliament. It only made headlines three months later, in April 2026, when journalists noticed it buried in the fine print. If you're an EU entrepreneur with your business, bank accounts, and residency concentrated in a single country, this story deserves your attention. It doesn't matter which country that is.
What happened in Germany
On December 5, 2025, the German Bundestag approved the Wehrdienstmodernisierungsgesetz (Military Service Modernisation Act). The Bundesrat cleared it on December 19. When the law entered into force on January 1, 2026, it activated Section 3, Paragraph 2 of the Wehrpflichtgesetz (Conscription Act). Not as a wartime measure. As permanent peacetime law.
The practical effect: roughly 20 million German men between ages 17 and 45 now legally need written approval from a Bundeswehr Career Center before staying abroad for longer than three months. Previously, this exit-permission requirement only applied during a formally declared state of tension or state of defense. Those are constitutional extremes that have never been invoked in the history of the Federal Republic.
As of April 2026, there's no enforcement mechanism and no penalties for non-compliance. The Defense Ministry has stated that approval "is to be granted" as long as military service remains voluntary. But the legal infrastructure is now in place. Administrative provisions, which can be tightened without parliamentary approval, haven't been published yet. And the same law contains a conditional conscription clause: if voluntary numbers fall short, the Bundestag can activate mandatory service with a single vote.
For a detailed legal analysis of the German provision, including exit tax implications and the "already abroad" exemption, read our full German-language article.
The EU dimension: not just a German story
Germany is the largest economy in Europe. When it moves, the signal travels across the continent. But Germany isn't acting in isolation. The entire EU is in the middle of a defense-spending pivot that has no precedent in the post-Cold War era.
EUR 392B
EU defense spending in 2025, nearly double the EUR 218B in 2021
EUR 800B
ReArm Europe / Readiness 2030 target through 2029
20M
German men now requiring exit permission under the new law
4%+ GDP
Poland's defense spending ratio, the highest in Europe
In November 2025, the European Commission adopted the Military Mobility Package, a framework for rapid, coordinated movement of military personnel and equipment across EU borders. The concept of a "Military Schengen" zone is being developed for implementation by 2027, including an Emergency Framework (EMERS) that can temporarily suspend normal transport regulations during a security crisis. NATO's 2% GDP guideline is now treated as a floor, not a ceiling. Germany is targeting 3.5% by 2029.
Conscription and military service obligations are being reintroduced or expanded across Europe:
- Latvia reintroduced mandatory military service for men in 2024.
- Denmark extended conscription to women and increased the service period to 11 months in 2025.
- Croatia restored mandatory military service in 2025.
- France announced a 10-month voluntary service program under President Macron in 2025.
- Poland launched voluntary military training for up to 400,000 citizens in 2025–2026.
- Germany enacted mandatory questionnaires, exit permits, and a conditional conscription clause in 2026.
The direction is consistent across the continent. Full conscription, expanded reserve obligations, or simply higher taxes to fund defense spending: the implications for entrepreneurs who have all their assets in one jurisdiction are the same. Concentration risk is increasing.
Could it happen in your country?
Germany's exit-permission requirement is the most concrete example so far. But every EU member state has its own legal framework for military obligations, and in most cases, the tools for restriction already exist on paper.
Czech Republic
Abolished conscription in 2004, but the legal framework for reintroduction still exists. The president can restore mandatory service through decree during a state of emergency. The Branny zakon (Defense Act) provides the statutory basis. Active conscription is politically unlikely near-term, but the legal mechanism is available and has been updated more recently than most citizens realize.
Poland
Building the largest conventional army in the EU (target: 300,000). Defense spending exceeds 4% of GDP. Mandatory military registration exists for all citizens. The Voluntary Territorial Defence Force (WOT) has been expanded aggressively. Infrastructure for mandatory mobilization is extensive, and proximity to Ukraine means obligations could be activated quickly.
Hungary
Professional army since 2004, but the Constitution explicitly provides for conscription in a state of preventive defense, emergency, or national crisis. Article XXXI: every adult male can be obligated to serve. The government has been unpredictable on defense policy. For entrepreneurs, that unpredictability is itself a form of risk.
Netherlands
Suspended conscription in 1997 via the Kaderwet dienstplicht, but dienstplicht was never formally abolished. All citizens receive a notification at age 17 that they're registered for potential military service. Defense spending is increasing, and the political debate about reactivation is growing louder. Reactivating dienstplicht requires a legislative act, not a constitutional amendment.
Germany
Already enacted. Since January 1, 2026, all men aged 17–45 require Bundeswehr permission for stays abroad exceeding three months. Conditional conscription can be activated by Bundestag vote. Read our complete analysis.
What this means for entrepreneurs
This article isn't about war predictions. And it's not about whether conscription will return to any specific country. It's about something every serious business owner already understands: concentration risk.
If your company is incorporated in one country, your bank accounts are in that same country, your personal residency is tied to it, and your assets are denominated in its currency, you have a single point of failure. That's true regardless of military policy. It's even more relevant when governments are actively expanding the legal tools available to them.
Exit taxes
Triggered the moment you try to leave. Germany, Netherlands, and others have aggressive exit tax regimes designed to capture value at the point of departure.
Administrative delays
Relocating your business when thousands of others are trying to do the same thing. First movers have an advantage. Late movers face queues.
Frozen optionality
The ability to move was always there, until the day it wasn't. Once restrictions are in place, your planning window closes retroactively.
Banking dependency
If your only accounts are domestic, a policy change can limit your access to liquidity overnight. Diversified banking is insurance.
None of these risks require a worst-case scenario. They require only a shift in regulatory direction. The kind of shift that's already underway.
The "Plan B" concept: jurisdictional diversification as business continuity
Every professionally managed company has a business continuity plan. Servers are backed up. Key-person insurance is in place. Supply chains are diversified. But when it comes to the jurisdictional foundation of the business itself, where it's incorporated, where its owner resides, where the money is held, most entrepreneurs have zero redundancy.
A "Plan B" isn't about leaving Europe. It's about making sure you have options if you ever need them. In practice, that means:
Residency in a second jurisdiction
UAE, Singapore, or another business-friendly country where you have a documented legal right to live and work.
A corporate entity outside your home country
With genuine substance, real banking, and operational activity. Not a shell, but a real second base.
Diversified banking
Across regulated jurisdictions (Singapore, UAE, Switzerland) that gives you access to liquidity independent of any single country.
Tax-compliant structuring
Planned in advance, in coordination with local advisors, and fully reported under CRS and applicable treaties.
This isn't an exotic strategy. It's the same logic that drives portfolio diversification in investing. Instead of diversifying across asset classes, you're diversifying across legal systems.
Learn how multi-jurisdiction structuring works in practice on our How It Works page, or explore specific structures on our Plans page.
Why timing matters more than you think
International structuring involves legal processes, tax planning, and administrative steps that can't be compressed into a week. Here's what the timeline actually looks like.
2–6 weeks
UAE or Singapore residency
Visa processing and company formation. The fastest path to a second legal home.
2–8 weeks
International bank accounts
Account opening and compliance checks across regulated jurisdictions.
2–3 years
Exit tax planning
Corporate restructuring, valuation, coordination with tax authorities. This is the part that can't be rushed.
Up to 10 years
Extended tax liability
In Germany, Section 2 AStG can extend tax obligations for up to 10 years after departure. In the Netherlands, the conserverende aanslag applies to Box 2 gains. The clock starts only when you actually leave.
The math is straightforward. An entrepreneur who begins planning in 2026 will have operational structures in place by 2028–2029 and will have completed extended tax liability periods by 2038–2039. Every year of delay pushes the entire timeline forward by one year.
The legal exemptions that protect expatriates (such as Germany's Section 1(2) WPflG, which suspends military obligations for those living permanently abroad) require that you've already relocated before restrictions tighten.
For country-specific tax planning, including exit tax strategies, explore our residency programs or request a personalized assessment.
Smart entrepreneurs don't plan based on today's headlines. They plan based on the direction of policy and the range of possible outcomes.
A measured perspective
The European Union remains one of the most stable, prosperous, and legally protected environments in the world. Freedom of movement under Article 21 TFEU and the Citizens' Rights Directive 2004/38/EC is a fundamental right. Democratic institutions, independent judiciaries, and constitutional protections are real and functioning.
But rights exist within legal frameworks. And legal frameworks can be modified. Germany's exit-permission requirement shows that restrictions which previously required a formal state of defense can be extended to peacetime through a single legislative amendment, passed without public debate, noticed only months later.
The direction is clear: defense spending is rising, military obligations are expanding, and the administrative infrastructure for controlling cross-border movement is being built. That doesn't mean the worst case will happen. It means the cost of being unprepared is rising.
Next step: free assessment
ETERAX GROUP helps EU entrepreneurs build international business structures: company formation, banking, residency, and tax-compliant structuring across UAE, Singapore, and Panama.
- Analysis of your current business and asset structure
- Identification of jurisdiction-specific risks
- Exit taxes, CFC rules, extended tax liability
- Recommended multi-jurisdiction structure
- Realistic timeline and cost estimate
- Coordination with your existing tax advisor
No commitment. No sales pressure. Just a clear picture of your options.
This article is for general informational purposes only and does not constitute legal or tax advice. The facts presented are based on publicly available sources including the Wehrdienstmodernisierungsgesetz (December 2025), Wehrpflichtgesetz, EU Treaty on the Functioning of the European Union, European Commission Military Mobility Package (November 2025), and reporting by Berliner Zeitung, Euronews, Frankfurter Rundschau, and the Library of Congress Global Legal Monitor. For individual structuring questions, consult a qualified tax advisor and/or attorney in your jurisdiction. Published April 2026.