Earlier quoted context omitted.
Really? Like, in Germany it's illegal for someone to have a full-time job doing software and then a side business making soap and selling it at a farmer's market on the weekend? That's... peculiar.
Yes! It basically means you go full on freelance or just stay put with whatever job you have. I wanted to try freelancing before I quite my full time job but it's not that easy legally.
Also you don't really need to track your hours when freelancing other than maybe for billing purposes so you really don't need to worry about hours anyway. Generally you are considered part-time self-employed when doing less than 18 hours per week.
Earning a bit on the side is really not an issue in Germany. In fact the combination of having a part time employed job and then doing freelancing is very popular.
What doesn't work is being full time employed at two companies but that would make no sense even if you could as you would earn much less and pay insane taxes.