In German universities (besides the law schools) a 1 to 5 scale for the grade (Note / Zensur) is used:

sehr gut	very good: an outstanding achievement
gut	good: an achievement, which lies substantially over average requirements
befriedigend	satisfactory: an achievement, which corresponds to average requirements
ausreichend	sufficient: an achievement, which still meets the requirements
nicht bestanden	not sufficient / failed: an achievement, which does not meet the requirements

Sometimes, esp. with a Dr. Phil. (D.Phil. / Ph.D.) also the Latin versions are used for the grading (here then the grade (Note / Zensur) is called Prädikat):

summa cum laude	mit Auszeichnung	"with honor"
magna cum laude	sehr gut	"very good"
cum laude	gut	"good"
cum laude	bestanden	"good"

There is no grade for failing then, because in that case the dissertation is just formally rejected, without any kind of grading.

For law students at German universities, a similar system to the 1 to 5 scale is used that comprises one more grade that is inserted between 2 'gut' and 3 'befriedigend', named "vollbefriedigend." This is because the grades "gut" and "sehr gut" are extremely rare, so an additional grade was created below "gut" to increase differentiation. Every grade is converted into points very much like the Gymnasium system described above, starting at 18 points (excellent) down to 0 points (poor). 4 points is the lowest passing grade.

Degree Recognition

German degrees are recognized worldwide and have a strong reputation as a result of the country's thorough education system and vast history. One should always consult with individual institutions for more in-depth details. Here is a website that can tell you more about the recognition of German degrees in other EU nations.