usage of CREATE function with client-server installation

Hello,

On our server NAV2009 (SP1) classic is installed.
A dll is created in VB with some functions. This dll is registered on the server.

Now I want to call the functions of the dll from a codeunit. The following basic code is used:
IF ISCLEAR(TestAutomation) THEN
IF NOT CREATE(TestAutomation) THEN
ERROR('Automation is not created');

TestAutomation.Function1(.., ..);
CLEAR(TestAutomation);

When running this code on a NAV client, the error message is shown because the automation is not created.
When registering the dll on the client PC the codeunit is running ok.

The help gives me the following on the parameter OnClient:
If OnClient is false (the default), then the Automation object is created on the Microsoft Dynamics NAV Server.

Can someone explain to me why the dll must be registered on every client? It would be easier to install the dll only on the server.

Thanks in advance.