http://www.germany-info.org/relaunch/info/archives/background/citizenship.html
Major changes in Germany's citizenship and naturalization laws took effect on January 1, 2000. Germany is now home to 7.3 million foreigners. Half of Germany's foreign residents have lived in the country for upwards of ten years, and each year roughly 100,000 children are born in Germany to non-citizens. More than 1.6 million foreign nationals were born in Germany; roughly two-thirds of the foreigners under the age of 18 now living in Germany were born there. A substantial minority of Germany's foreign residents are refugees from military conflict or political persecution; in 1997, the most recent year for which comprehensive figures are available, 1.4 million refugees and asylum-seekers were living in Germany. The revisions in the citizenship and naturalization laws make it easier for long-term residents to qualify for German citizenship and give many children born to foreigners an automatic claim to German citizenship.
There are three ways to become a citizen of the Federal Republic of Germany: by birth, by naturalization and, for ethnic Germans from Eastern Europe and the Soviet successor states, by claim under the "Right of Return." The most important change in Germany's citizenship law is that the principle of jus sanguinis - of defining citizenship by inheritance - has been supplemented with the principle of the jus soli ("right of soil") - of defining citizenship by place of birth.
A child becomes a German citizen automatically upon birth if at least one parent is a German citizen. [...] A child adopted by a German citizen becomes a German if the child is under 18. [...]
As of January 1,
2000, children born in Germany to foreign parents acquire German citizenship
at birth if at least one parent has lived legally in Germany for a minimum of
eight years. Children who acquire German citizenship under this provision will
be allowed to hold dual citizenship until they reach adulthood; they will be
required to choose between their German and foreign citizenship by the age of
23 at the latest. Children born to foreign parents before the enactment of the
new law who are under the age of ten will also be able to claim German citizenship
by virtue of birth in Germany, if the above named conditions (time of legal
residence) apply. That claim must be exercised within a year of the new law's
promulgation,
and those who obtain German citizenship in this way will also be required to
choose between their German and foreign citizenship by the age of 23.
The main change
in the new regulations governing naturalization is a substantial reduction
in the length of residency requirement. Adult foreigners who have resided legally
in Germany for eight years have a claim to citizenship if they:
- give up their previous citizenship;
- have not been convicted of a major felony;
- are able to support themselves and their family; if the individual becomes
dependent upon public assistance for reasons beyond their control, this condition
is waived.
In addition, applicants for German citizenship will be required to demonstrate
proficiency in the German language and declare their allegiance to the Basic
Law (Grundgesetz), the Federal Republic's constitution.