International sales manager Simret Senait Woldu said the south-east London office would initially act as support for its merchants. Gmund hopes to eventually sell direct, but only when approached by designers or end users.
"There is a lot of potential in the UK paper market we have not used," she said.
The decision to open the UK office follows the success of the Bavarian paper mills sales office in the US.
Gmund is known for its Valentinoise, Reaction, Gmund Colors and Bier Papier luxury paper brands.
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"Gosh! That’s a huge debt - especially HMRC! It’s a shock that HMRC allowed such an amount to be accumulated."
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