In English this is called "elimination communication" or EC. The parent subconsciously figures out when the baby needs to go based on schedule, observation of milk/water intake, and subtle behavioral cues (facial expression change, posture, etc).

It's a system that works quite well if the baby is exclusively cared for by a stay-at-home parent or a long-term nanny (and no other babies or toddlers in the house to distract the parent/nanny). But try to leave the baby with a new sitter or at a daycare - they have no idea what your baby's cues are and cannot be bothered to learn them; so back in diapers the baby goes.

We have 1 year of paid parental leave (although only ~60% of your salary) in Germany, so almost everyone can do it.

What happens after a year when the parents go back to work? The baby goes to the potty by themselves at that point?

This sounds different to potty-training, which is where the child knows that they need to wee or poo and tells you or goes straight to the potty to do it. "Abhalten" sounds like the parent training to know rather than the child.