Die weltweite Ausbreitung des Coronavirus sorgt für heftige Turbulenzen im Wirtschaftsleben. Gerät eine GmbH in finanzielle Schieflage, steht besonders die Geschäftsführung unter Druck. Sie kämpft um das wirtschaftliche Überleben der Gesellschaft. Gleichzeitig kommen verschiedene Szenarien für die Haftung des Geschäftsführers in Betracht, wenn dieser keine Krisenprävention durchgeführt hat oder in der Krise nicht die erforderliche Sorgfalt anwendet.
Haftung wegen unzureichender Krisenprävention
The coronavirus pandemic is sending shock waves through the business world. If a GmbH (German limited liability company) finds itself in financial distress, the management in particular will be under pressure and must fight for the survival of the business. At the same time, there are various scenarios in which managing directors could be held liable for not implementing crisis prevention measures or exercising the necessary diligence during the crisis.
Liability for inadequate crisis prevention
With a recent draft act to amend the German Insolvency Code (Insolvenzordnung – InsO), the German Federal Ministry of Justice and Consumer Protection intends to reduce uncertainty regarding insolvency claw-back, in particular regarding Sec. 133 InsO. The result may be that restructuring opinions that are now market standard when (re)financing financially troubled companies in Germany become redundant.
Current legal status
In a situation where the survival of a German company depends on restructuring measures by third parties (mainly lenders) who fear that the shareholders may use their hold-out position in a potential subsequent exit by sale of the shares, it is an option for the lenders to demand from the shareholders that the shares are transferred to a trustee to be held in a “double-sided trust” (doppelnützige Treuhand).
Key point
In a financial restructuring, creditors have to pay attention that the restructuring undertakings of the insolvent company are likely to be achieved.
Background
Under German insolvency law, the insolvency administrator may challenge a transaction if an insolvent company intended to disadvantage its creditors (and the other party knew that intention). The German Supreme Court presumes such intention if a company knew about its impending illiquidity.
Facts
This article looks at ways to restructure debt taken up by a German company. First it discusses financings governed by English law and then moves on to look at options where German law-governs the debt.
Financings governed by English law (restructuring through schemes of arrangement)
In recent years a number of German companies such as Tele Columbus, Rodenstock and Primacom have used English law scheme of arrangements to restructure their debt.
An element of the restructuring toolbox
To date, the German Insolvency Code (Insolvenzordnung) does not contain provisions governing group insolvencies. If several entities within a group of companies become insolvent, individual insolvency proceedings are opened and sometimes even individual insolvency administrators are appointed for each entity.
German proposals
This is the second part of a two-part article on ways to restructure debt taken up by a German company. The first part looked at financings governed by English law, this second part deals with German law-governed debt.
Part II – Financings governed by German law (restructuring through protective shield proceedings or schemes of arrangement)
This is a two-part article on ways to restructure debt taken up by a German company. The first part looks at financings under English law, the second refers to German law-governed debt.
Part I – Financings governed by English law (restructuring through schemes of arrangement)
In recent years a number of German companies such as Tele Columbus, Rodenstock and Primacom have used English law scheme of arrangements to restructure their debt.
An element of the restructuring toolbox