The German Parliament has, in response to the ongoing crisis in the financial markets, extended a legislation, which originally came into force on October 18, 2008, amending, inter alia, parts of the German Insolvency Code. These amendments, which had in certain cases lead to a relaxation of the obligation to file for insolvency, will now be valid without limitation in time. It can be expected that it will be published and come into force already this year.

Obligation to File for Insolvency

Introduction

German insolvency law is governed by a comprehensive Insolvency Code which entered into force on January 1, 1999 and has been amended from time to time, the last major reform being the Act for the Further Facilitation of the Restructuring of Companies (ESUG) which largely came into force as of 1 March 2012. There is only one primary uniform insolvency procedure which applies to both individuals and companies. In the following, we focus on companies.

Einleitung

On December 13, 2011, the Act for the Further Facilitation of the Restructuring of Companies (ESUG), whose material provisions will come into force on March 1, 2012, was announced in the Federal Gazette. The ESUG bundles several reformatory efforts with regard to German insolvency law and will likely have significant effects on the daily practice. Generally, the restructuring of companies in financial crisis will be made easier. The creditors’ influence on the proceedings, including the selection of the person of the insolvency administrator, is increased.

Im deutschen Vertragsrecht gilt das Prinzip der Vertragstreue (pacta sunt servanda), welches die Verpflichtung zur Erfüllung von Verträgen zum Gegenstand hat. Hiervon werden im Falle der Insolvenz einer Vertragspartei Ausnahmen gemacht. Mit Eröffnung des Insolvenzverfahrens wird das Prinzip der Vertragstreue modifiziert. 

The EU Decision

The EU Commission has held on January 26, 2011 that the so called restructuring privilege offered by German corporate tax law, which allows corporations in a distressed financial situation to continue to set off tax loss carry forwards against future profits even if their shareholder structure has substantially changed, is incompatible with EU State Aid provisions.

The recipients, which have applied the restructuring privilege, are now threatened with the reclaim of the tax benefits.

Für weitere Fragen steht Ihnen
folgender Kollege zur
Verfügung:
Berlin
Dr. Thorsten Seidel, LL.M.
T.: +49 (0)30 2 20 02 81 724
E-Mail: Thorsten.Seidel
@bakermckenzie.com
Beendigung von Ergebnisabführungsverträgen bei
M&A Transaktionen und Restrukturierungen
Ergebnisabführungsverträge („EAV“) sind häufig bei M&A Transaktionen und
im Rahmen von Restrukturierungen zu beenden. Zwei neuere
Gerichtsentscheidungen sollten dabei beachtet werden. Andernfalls laufen
die Parteien Gefahr, dass der EAV nicht ordnungsgemäß beendet wird oder

Der Bundestag hat Ende Februar 2017 eine Reform des Anfechtungsrechts verabschiedet. Die Reform bringt substantielle Änderungen des Insolvenzanfechtungsrechts, von denen in erster Linie Lieferanten und Dienstleister profitieren dürften, die sich Ansprüchen eines Insolvenzverwalters in der Insolvenz ihres Kunden ausgesetzt sehen. Die neuen Regeln sind am 5. April 2017 in Kraft getreten und gelten für alle Insolvenzverfahren, die ab diesem Datum eröffnet werden.

1. Hintergrund der Anfechtungsreform

With its judgment of November 28, 2016, the German Supreme Tax Court (Bundesfinanzhof; “BFH”) dismissed the application of the tax administration’s so-called restructuring decree (Sanierungserlass). The restructuring decree allowed, subject to certain conditions, a suspension and abatement of taxes on so-called cancellation-of-debt income (“COD-Income”) otherwise resulting from certain recapitalization measures such as the waiver of debt and “debt-to-equity swaps”.