If you really believe business should only be conducted in the official language (ie not both official language and English), then it better be worth the cost. Nobody is going to go to trouble of learning your language to deal with your market unless it is worth it. Multiply this by lots of counties and languages and it means you are missing out unless you are large or important.
If your country wants foreign investment, you don't attract people unless you meet them where they are (or, again, your market is really worth it).
On top of that, basically all international business between two companies will be done in English.
So in practice, it will be your countries' loss to establish these sorts of barriers.
Now, if your country is happy with the level of investment it gets from foreign small businesses, then great, nothing to do. But you won't get to have it both ways.
Germany is near the top of the list of countries with the least need for foreign investment - it is a capital-rich economy capable of financing all its economy domestically and looking for investment opportunities in the surrounding countries (both EU and outside, e.g. as of very recently Russia), not searching to receive investments.
Is it really worth the time to try to attract small businesses? Or should you aim for medium that are ready to hire someone German to do this in Germany? It is not massive bar to hurdle. But it seems reasonable to not allow just about anything to setup legal entity.
If your country wants foreign investment, you don't attract people unless you meet them where they are (or, again, your market is really worth it).
On top of that, basically all international business between two companies will be done in English.
So in practice, it will be your countries' loss to establish these sorts of barriers.
Now, if your country is happy with the level of investment it gets from foreign small businesses, then great, nothing to do. But you won't get to have it both ways.