Companies belonging to real estate group Project go bankrupt
German real estate group Project has really been feeling the effects of the struggling real estate market, with a number of the group’s companies having filed for bankruptcy. Germany’s real estate market has been experiencing a decline in demand due to rising construction costs and high interest rates, and the construction industry is starting to […]
Liability of board members and managing directors for antitrust infringements
Executive board members and managing directors are not personally liable for fines imposed on the company itself. That was the verdict of Düsseldorf’s higher regional court – the Oberlandesgericht (OLG) Düsseldorf – in a judgment from July 27, 2023 (case ref.: VI-6 U 1/22). Board members and managing directors are exposed to significant liability risks, […]
Temporary relaxation of going-concern forecast requirements coming to an end
The recent amendments to German insolvency law, which saw the forecast period for projecting whether a company is likely to survive as a going concern cut from twelve to four months, are set to expire by no later than the end of this year. The response of the German government to the spike in energy […]
Oldenburg court opines on improper application of joint liability in connection with loans
The combination of joint liability and loan agreements has the potential to fall foul of the law to such an extent that the co-debtor cannot be made to pay for the debt. Banking law in Germany sets strict limits on the ability of banks to secure loans. One example of this is the potential for […]
BAG gives its verdict on admissibility of video recordings in wrongful termination proceedings
Recordings from overt video surveillance may be admissible in wrongful termination proceedings. That was the outcome of a recent case heard by Germany’s Federal Labor Court (case ref.: 2 AZR 296/22). Data protection, despite its prominence throughout the German legal system, including in the fields of employment and labor law, does not trump all other […]
Embezzlement in connection with preferential treatment
Paying works council members inflated salaries may amount to embezzlement. That was the verdict of Germany’s most senior court for civil cases – the Bundesgerichtshof (BGH) – in a judgment from January 10, 2023 (case ref.: 6 StR 133/22). Embezzlement lies at the heart of many corporate crimes, including (potentially) the failure to respect the […]
Export restrictions and licenses
Geopolitical developments have increasingly led to a situation in commercial law where it is sometimes necessary to comply with export restrictions when exporting goods from the European Union. Section 4 of Germany’s Foreign Trade and Payments Act (AWG) provides a basis in commercial law for restricting legal transactions if this is necessary in order to […]
Misleading claims about neutral impact of products on climate and environment
Promoting products with expressions such as “climate neutral” has the potential to be misleading and to fall foul of competition law. Such was the verdict of the Landgericht (LG) [Regional Court of] Karlsruhe in a judgment dated July 26, 2023 (case ref.: 13 O 46/22 KfH). Germany’s Unfair Competition Act (UWG) deems business practices misleading […]
Delay in moving into family home does not always prevent it being exempt from estate tax
If an heir is unable to move into the family home immediately, it may still be possible for the property to be inherited tax-free if the delay is attributable to renovation work. That was the verdict of Germany’s federal court of appeal for tax matters, the Bundesfinanzhof (BFH) (case ref.: II R 6/21). Provided certain […]
Cologne tax court rules special funds can receive preferential tax treatment
Special investment funds are eligible for preferential tax treatment, according to a recent ruling of the Finanzgericht (FG) [Fiscal Court of] Cologne from August 24, 2022 (case ref.: 12 K 1540/19). German tax law allows special funds established under Luxembourg law to benefit from certain tax privileges. MTR Legal Rechtsanwälte, a commercial law firm whose […]
Voluntary disclosure – Hesse purchases Pandora Papers
The German state of Hesse has begun delving into the so-called “Pandora Papers” with a view to uncovering evidence of tax-related offenses. Anyone considering submitting a voluntary declaration for tax evasion ought to take action now. The name “Pandora Papers” refers to the millions of financial documents that were leaked in 2021 containing information about […]
Global minimum tax for companies operating internationally
International tax law is facing a major shake-up with the introduction of a global minimum tax on corporate income. International companies need to sit up and take notice. This far-reaching reform of international tax law, which will mainly affect corporations that operate internationally, seeks to establish a global minimum tax rate of 15 percent with […]
Security for costs and the enforcement of foreign arbitration rulings
According to a judgment of Germany’s highest civil court – the Bundesgerichtshof (BGH) – claimants in proceedings to obtain a declaration of enforceability for foreign arbitration rulings must provide security for the costs of the proceedings if this is requested by the defendant. In proceedings where the claimant is resident abroad, it is important to […]
Clear wording in wills
A will should always be worded clearly to prevent misunderstandings that could lead to a last will and testament being executed in manner that is inconsistent with the testator’s wishes. In Germany, the rules of intestate succession kick in automatically in the absence of a will or contract of inheritance, and the end result may […]
Inheritance cannot be contested based on the amount of estate tax to be paid
Individuals coming into an inheritance should always be mindful of estate tax, since it is very difficult to challenge the decision to accept an inheritance at a later date on account of an error relating to estate tax. German inheritance laws provide for different tax allowances for estate tax depending on the degree of kinship. […]
The equalization of accrued gains in divorces involving an entrepreneur
There is a lot at stake when a married couple divorces and one of the spouses is an entrepreneur. One challenge this can present for both the company as well as the couple is the potential headache that comes from having to assess the value of a stake in a GmbH – a type of […]
Bank fined for GDPR breach
Violating the EU’s General Data Protection Regulation can prove to be an expensive mistake. One direct bank recently had to learn this the hard way, having been issued with a 300,000 euro fine. The General Data Protection Regulation – or “GDPR” for short – is certainly no toothless paper tiger, a fact an increasing number […]
Displaying photo wallpaper not a breach of copyright
An advertisement for a vacation rental that features a photo wallpaper does not constitute a copyright infringement, according to the Landgericht (LG) [Regional Court of] Stuttgart (case ref.: 17 O 39/22). The protection of copyright in photographs encompasses the originator’s personal rights – often referred to as “moral rights” – and the rights to (commercially) […]
Adler Group under investigation for possible accounting fraud
The Frankfurt District Attorney’s Office has ordered a large-scale raid of Adler Group premises in response to allegations of accounting fraud, embezzlement, and market manipulation. 175 investigators were sent by the Frankfurt DA’s Office and Germany’s Federal Criminal Police Office (BKA) on June 28, 2023, to search Adler Group business premises and accommodation at several […]
Emmentaler is a type of cheese, not a trademark
The European Union’s General Court has ruled in a judgment from May 24, 2023, that the word “Emmentaler” cannot be protected as a trademark for cheese from Switzerland (case ref.: T-2/21). While it is true that indications of geographical origin may be eligible for trademark protection, it is important that they not have a primarily […]
