News and Press - Lawyers Attorneys MTR Rechtsanwälte Germany - Cologne Berlin Bonn Düsseldorf Frankfurt Hamburg Munich Stuttgart https://www.mtrlegal.com/en/ News and Press releases of Lawyers Attorneys MTR Rechtsanwaltsgesellschaft mbH Germany Cologne Berlin Bonn Düsseldorf Frankfurt Hamburg Munich Stuttgart en MTR Rechtsanwaltsgesellschaft mbH Sat, 27 Feb 2021 07:45:35 +0100 Sat, 27 Feb 2021 07:45:35 +0100 TYPO3 news-300 Fri, 26 Feb 2021 13:02:17 +0100 Bundeskartellamt imposes million-euro fines in response to illegal arrangements https://www.mtrlegal.com/en/news-and-press/detail/news/bundeskartellamt-imposes-million-euro-fines-in-response-to-illegal-arrangements.html The Bundeskartellamt – Germany’s Federal Cartel Office – has imposed fines totaling approx. 175 million euros on five aluminum forging companies and ten employees responsible for engaging in anticompetitive arrangements.

The Bundeskartellamt announced on December 23, 2020 that senior staff members of the relevant companies had, over a period of years, been exchanging information on cost factors and encouraging one another to pass on rising costs directly to their customers. We at the commercial law firm MTR Rechtsanwälte note that arrangements of this kind are prohibited because they restrict competition.

The investigations by the Bundeskartellamt were triggered by a leniency application submitted by one of the firms involved, with the company in question emerging from the process without being fined thanks to the leniency program.

According to the findings of the Bundeskartellamt, representatives of the aluminum forging companies regularly met from 2006 to 2018, though not all the forging companies were involved throughout the entirety of this period. There was a broad consensus among the companies that increases in procurement costs would be passed on directly to their customers. To this end, the parties exchanged information about their respective purchasing costs for aluminum, as well as energy costs and processing costs. They also agreed on how the cost increases could be passed on to customers.

The companies’ representatives further agreed not to account for procurement costs and to only consider the added value when calculating customer discounts referred to as “ratio” by the parties involved, with these typically being agreed at the beginning of a supply relationship. The forging companies’ customers include manufacturers and suppliers in the automotive industry.

In setting the fines, the Bundeskartellamt took into account the fact that two companies supported and cooperated with the investigations. Together with another one of the forging companies, they admitted to the charges as part of an amicable conclusion to the proceedings.

The Bundeskartellamt’s fining decisions may yet be the subject of an appeal.

The illegal arrangements entered into by the parties involved restricted competition and violated antitrust law. However, violations of antitrust law are by no means always as blatant as was the case here. Individual contractual clauses can themselves often give rise to a violation and thus severe penalties.

Lawyers with experience in the field of antitrust and competition law can serve as advisors.

For more information:

https://www.mtrlegal.com/en/legal-advice/antitrust-law.html

]]>
KartellrechtPressemitteilungen
news-297 Tue, 23 Feb 2021 21:08:00 +0100 Distributing FFP2 masks free of charge in breach of competition law https://www.mtrlegal.com/en/news-and-press/detail/news/distributing-ffp2-masks-free-of-charge-in-breach-of-competition-law.html Groups deemed to be at risk can redeem vouchers for FFP2 masks. Pharmacies that waive the two-euro personal contribution are violating competition law according to a ruling of the Landgericht (LG) Düsseldorf – the Regional Court of Düsseldorf.

In order to protect those at particular risk against being infected with the coronavirus, the German parliament has adopted legislation (Coronavirus-Schutzmasken-Verordnung, SchutzmV) that provides for and regulates the distribution of FFP2 masks by pharmacies to the most vulnerable people. The country’s health insurance funds have sent vouchers for FFP2 masks to their insured members, which the latter can redeem in pharmacies. In return for a personal contribution of two euros they receive six masks.

Some pharmacies have advertised that they are waiving payment of the personal contribution and offering the FFP2 masks to those at risk completely free of charge. They need to tread carefully. We at the commercial law firm MTR Rechtsanwälte note that waiving the personal contribution, as well as similar discount initiatives, may amount to a breach of competition law.

That was certainly the verdict of the LG Düsseldorf in an expedited hearing from January 15, 2021, which resulted in one such discount initiative being banned (Az.: 34 O 4/21). The lawsuit was filed by a competition association against a pharmacy holding company that was promoting its affiliated pharmacies with reference to waiving the personal contribution.

In its reasoning, the LG Düsseldorf held that the provisions of the SchutzmV concerned with the personal contribution ought to be viewed as a regulation governing market behavior, and that failure to comply with this regulation thus amounts to an anticompetitive infringement.

The court went on to state that the purpose of the legislation is to ensure that FFP2 masks are distributed in a consistent and appropriate manner in order to protect particularly vulnerable groups of people against being infected with the coronavirus, noting that this is the reason why the masks ought to be used sensibly and not wastefully. The FFP2 masks were said by the court to be intended for those who really need them and who are prepared to pay the personal contribution of two euros.

While the ruling is not yet final, it has already sent an important signal. Violations of competition law may be met with severe penalties. Heavy fines are a real possibility.

Lawyers with experience in the field of antitrust and competition law can serve as advisors.

For more information:

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
PressemitteilungenWettbewerbsrecht
news-293 Tue, 16 Feb 2021 13:58:46 +0100 BGH: D&O insurer liable for payments made after the onset of insolvency https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-do-insurer-liable-for-payments-made-after-the-onset-of-insolvency.html The insurer behind a D&O policy is liable for payments made after the onset of insolvency. That was the verdict of the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – in a judgment from November 18, 2020 (Az.: IV ZR 217/19).

A managing director is personally liable for any payments they arrange after the company is already insolvent, with the insolvency administrator able to reclaim the relevant amounts from them. This could threaten the managing director’s livelihood. The ruling in question by the BGH affords managing directors greater security by providing that the insurer must pay out on the D&O policy in such cases.

Whether the insurer behind a D&O policy is obliged to pay in cases of this kind has been a contentious issue to date. For instance, in a judgment from June 20, 2018, the OLG Düsseldorf – the Higher Regional Court of Düsseldorf – ruled that the insurer is not liable for payments arranged by the insured managing director after the company became insolvent (Az.: I-4 U 93/16). The court found that cases like this do not give rise to a liability claim for damages within the meaning of the terms and conditions of the insurance policy, but rather a claim for compensation sui generis.

However, the BGH took a different view, ruling that the company’s right under section 64 of the German Limited Liability Companies Act (Gesetz betreffend die Gesellschaften mit beschränkter Haftung, GmbHG) to compensation for payments made after the company becomes insolvent, or its over-indebtedness is established, amounts to a liability claim for damages.

In the instant case before the BGH, an insolvency administrator asserted claims against the insurer with whom the managing director had taken out a D&O insurance policy. The insurer did not wish to pay out, justifying this course of action with reference to the terms and conditions of the policy. This line of reasoning was not upheld by the BGH. The Karlsruhe judges held that the issue of whether or not the claims amounted to insured claims for damages was to be judged based on the perception of the average policyholder without specialist knowledge of insurance law.

The BGH went on to state that while the typical D&O policyholder is versed in business and familiar with general terms and conditions, their interpretation of the relevant clause and their understanding of the purpose behind the policy would lead them to view the rights arising from sentence 1 of section 64 GmbHG as an entitlement to claim damages within the meaning of the terms and conditions of the policy. The court noted that said individual would construe the clause as meaning that the insurance would cover any financial losses.

Lawyers with experience in the field of company law can advise on matters pertaining to D&O insurance.

For more information:

https://www.mtrlegal.com/en/legal-advice/company-law.html

]]>
GesellschaftsrechtPressemitteilungen
news-290 Fri, 05 Feb 2021 08:18:49 +0100 BFH: Obtaining an expert opinion on purchase price allocation of land https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-obtaining-an-expert-opinion-on-purchase-price-allocation-of-land.html In the event of a dispute between a taxpayer and the tax authorities regarding the allocation of the fair market value of land and buildings in real terms, the fiscal courts are required to obtain an expert opinion.

Appraisals of the fair market value of buildings and land in real terms are often contentious. While an allocation of the purchase price to land and buildings is common in cases involving a contract for the purchase of real estate, the tax authorities often do not go along with the outcome based on the assumption that the allocation does not reflect the economic reality but is instead aimed at securing tax benefits, with only the building portion being depreciable for wear and tear.

The tax authorities like to fall back on a working guide of the Bundesfinanzministerium – Germany’s Federal Ministry of Finance – when it comes to allocating the purchase price in these cases. Yet, according to a ruling of the Bundesfinanzhof (BFH) – Germany’s Federal Fiscal Court – from July 21, 2020 (Az.: IX R 26/19), this does not go far enough. We at the commercial law firm MTR Rechtsanwälte can report that, in the event of a disputed real estate appraisal, the relevant fiscal court is generally required to obtain the opinion of an expert for the purposes of land valuation.

The case before the BFH concerned a plaintiff who had acquired a rented condominium in a large city for the price of 110,000 euros in 2017. The purchase agreement stipulated that 20,000 euros of the purchase price was to be allocated to the land. While the buyer assumed for the purposes of wear and tear depreciation that the building portion made up 82 percent of this, the tax office took an entirely different view on the matter. It started from a mere 31 percent as its basis, with this determination having been informed by the Bundesfinanzministerium’s “Arbeitshilfe zur Aufteilung eines Gesamtkaufpreises für ein bebautes Grundstück (Kaufpreisaufteilung)” [Working Guide on the Allocation of the Total Purchase Price for a Developed Plot of Land (Purchase Price Allocation)]. The buyer’s lawsuit was unsuccessful before the fiscal court.

However, the BFH disagreed with the lower court’s assessment, ruling that the Bundesfinanzministerium’s working guide did not guarantee that the requested allocation proceed on the basis of the fair market value of land and buildings in real terms. The court held that this would reduce the valuation process to a mere asset value approach, neglecting other evaluation criteria such as local and regional factors. The BFH therefore concluded that it is generally necessary to obtain an expert opinion for the purposes of the assessment.

Lawyers with experience in the field of tax law can provide counsel in the event of tax disputes with the authorities.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/tax-dispute.html

]]>
SteuerstreitPressemitteilungen
news-289 Wed, 03 Feb 2021 10:22:23 +0100 OLG Hamm on reporting illegality in e-commerce https://www.mtrlegal.com/en/news-and-press/detail/news/olg-hamm-on-reporting-illegality-in-e-commerce.html A company is not in breach of competition law if it reports illegality by a competitor on an online e-commerce platform and the allegations are true. That was the verdict of the Oberlandesgericht (OLG) Hamm – the Higher Regional Court of Hamm.

Antitrust infringements are a persistent feature of the e-commerce landscape. Large online platforms have for this reason put in place reporting systems for these kinds of violations, with offers being delisted when flagged accordingly. Of course, this is not meant to give rise to unwarranted complaints against competitors that hinder their business operations. We at the commercial law firm MTR Rechtsanwälte note that unwarranted complaints are contrary to the German Unfair Competition Act (Gesetz gegen den unlauteren Wettbewerb, UWG) and represent antitrust infringements in and of themselves.

The situation is different, however, if a company reports a rival business to the party operating a commercial platform in response to actual illegality. A ruling of the OLG Hamm from October 8, 2020 found that this does not constitute an anticompetitive infringement.

The plaintiff in the instant case sells lamps and lights via a large commercial platform online. It reported a violation on the part of a competitor that had failed to provide the necessary information regarding the energy efficiency class of lamps in relation to two offers. The online platform subsequently removed these and an additional ten offers by the party responding to the lawsuit from its listing. The latter then had the plaintiff issued with a formal warning, arguing that the complaint was unfair, amounted to an act of commercial aggression, libel, a concerted effort to hinder its business, and was in violation of the UWG. The plaintiff responded in kind with its own warning letter, demanding that the responding party refrain from continuing to advertise the lamps without the required labeling. Furthermore, it sought a declarative statement confirming that the responding party had no claims against it.

The plaintiff was successful both at first instance and in the appeal proceedings before the OLG Hamm, which found that the complaint submitted in relation to the online platform was justified and did not amount to an unfair business practice, and that the product labelling was in fact inaccurate. Thus, the complaint constituted neither an act of commercial aggression, nor libel, slander, or an obstruction.

Anyone considering reporting antitrust infringements to the party running an online platform ought to be sure that the allegations are true, as flagging another party without justification may backfire and give rise to formal warnings and damages claims.

Lawyers with experience in the fields of antitrust and competition law can serve as advisors.

For more information:

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
WettbewerbsrechtPressemitteilungen
news-286 Tue, 02 Feb 2021 13:20:09 +0100 Automatic exchange of information with Turkey – Voluntary declaration for tax evasion https://www.mtrlegal.com/en/news-and-press/detail/news/automatic-exchange-of-information-with-turkey-voluntary-declaration-for-tax-evasion.html Turkey is the latest country to sign up to the automatic exchange of information as part of efforts to combat cross-border tax evasion. It is still possible to submit a voluntary declaration for tax evasion.

There are now more than 100 countries participating in the automatic exchange of (financial) information (AEOI). Former tax havens such as Switzerland, Austria, and Liechtenstein have already signed up, and Turkey is now following suit. The process involves countries committing to mutually exchange the banking information of taxpayers who reside in another country, making it increasingly difficult to conceal untaxed income from foreign accounts from the exchequer. We at the commercial law firm MTR Rechtsanwälte can report that this now applies to accounts in Turkey as well.

The information exchanged always relates to the previous year, which means information from the calendar year 2019 was exchanged in 2020. The transfer of data is normally supposed to take place by September 30. Due to the coronavirus pandemic, the participating countries have agreed that this year the transfer of data will not be required until December 31.

Turkey’s participation in the exchange of information is of great importance to the German tax authorities. They will receive the financial information of all taxpayers registered in Germany with an account in Turkey. The authorities are then able to examine whether taxes have been duly paid on the income deposited in the foreign account. Should they come across irregularities in doing so, this can quickly give way to accusations of tax evasion and the threat of commensurate sanctions.

Exemption from punishment is possible by submitting a voluntary declaration, though this has to occur before the tax evasion is discovered by the authorities. Since this year the data does not need to be transferred as part of the AEOI until December 31, the parties concerned can still take action before the tax evasion is discovered. That said, the voluntary declaration must not only be submitted in due time but also be exhaustive if it is to be capable of leading to an exemption from punishment.

These represent significant obstacles for a layperson, with even minor errors potentially resulting in the voluntary declaration failing to achieve the desired outcome. Those concerned should not turn to their tax office for answers to any questions, as voluntary disclosure may no longer be possible as a result.

The best course of action is to consult with lawyers with experience in the field of tax law. They are familiar with the requirements a voluntary declaration needs to fulfil in order for it to be able to lead to an exemption from punishment.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/voluntary-disclosure.html

]]>
SelbstanzeigePressemitteilungen
news-284 Wed, 20 Jan 2021 09:37:20 +0100 LG München: No risk of confusing advertisements featuring maritime themes https://www.mtrlegal.com/en/news-and-press/detail/news/lg-muenchen-no-risk-of-confusing-advertisements-featuring-maritime-themes.html The Landgericht (LG) München – Regional Court of Munich – has ruled that consumers were not being misled by two manufacturers promoting their fish products using a captain, and that the advertisements in question therefore did not violate competition law.

A food manufacturer that had been promoting its fish products using a captain sporting a beard and cap for many years accused one of its competitors of having copied this promotional character, arguing that this amounted to misleading advertising because of its potential to confuse consumers. The Gesetz gegen den unlauteren Wettbewerb (UWG) – the German Unfair Competition Act – prohibits practices that deceive consumers as to the origin of a product.

We at the commercial law firm MTR Rechtsanwälte can report that, according to the ruling of the Landgericht München, the use of maritime themes is not in and of itself liable to mislead consumers and thus does not constitute a violation of competition law.

In its judgment from December 3, 2020 (Az.: 17 HK O 5744/20), the LG München held that it is only natural for fish products to be promoted using maritime themes such as the sea, coast, sky, and weather, and that this cannot be viewed as plagiarism of an advertising concept.

Furthermore, there were said to be clear differences between the advertisements, including with respect to the main character. The court found that while the plaintiff was promoting its products using a character that was recognizable as a captain, it was not possible to identify the protagonist featured in the advertising of the company responding to the lawsuit as a sailor. The court noted that the latter was not wearing a sailor’s outfit but was instead adorned with a tie and silk scarf. It further stated that the fact that this character by the sea was wearing a skipper cap did not in and of itself make him a sailor, noting that this style of cap is particularly worn a lot in northern Germany. The party responding to the lawsuit could not be prohibited per se from promoting its products using a mature man with a graying beard, particularly as the use of the term “Best Agern” [best agers] – a reference to consumers above the age of 50 – is currently extremely popular and widespread in advertising.

The LG München went on to point out that there were other significant differences between the commercials, and that the respective names and indications of origin were clearly visible. As such, the court concluded that there was no risk of consumers becoming confused.

Misleading advertising is contrary to competition law and accordingly may give rise to formal warnings or injunction suits. Lawyers with experience in the fields of antitrust and competition law can serve as advisors.

For more information:

 

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
WettbewerbsrechtPressemitteilungen
news-282 Wed, 13 Jan 2021 11:55:19 +0100 FG Düsseldorf: Demolition of inherited family home may retrospectively give rise to estate tax https://www.mtrlegal.com/en/news-and-press/detail/news/fg-duesseldorf-demolition-of-inherited-family-home-may-retrospectively-give-rise-to-estate-tax.html The demolition of your parent’s home post-inheritance may lead to a retrospective loss of tax-exempt status. That was the verdict of the Finanzgericht (FG) Düsseldorf – the Fiscal Court of Düsseldorf – in a judgment from January 8, 2020 (Az.: 4 K 3120/18 Erb).

Children who inherit real estate from their parents can receive an exemption from estate tax even if they go over their personal tax allowance of 400,000 euros. We at the commercial law firm MTR Rechtsanwälte note that this is conditional on the heirs personally occupying the property for the next ten years and the living space not exceeding 200 square meters.

Heirs must nonetheless tread carefully if they decide to have the inherited family home demolished within this ten-year period, as this may result in estate tax being imposed retrospectively. That was the verdict of the Finanzgericht Düsseldorf in a recently published judgment from January 8, 2020. According to the ruling, the tax can be levied even if the house exhibits significant defects and was demolished for that reason.

The proceedings before the FG Düsseldorf concerned a daughter who had inherited her parent’s house in 2009. She went on to personally occupy the property for the next seven years, after which time it became increasingly difficult for her to reach her second-floor apartment and installing a stair lift did not seem appropriate given the poor structural condition of the house. She therefore ultimately decided to have the building demolished.

Since she had thus only personally occupied the inherited property for a mere seven years, the competent tax office subsequently demanded payment of estate tax. The heiress’s appeal against the tax assessment notice was unsuccessful.

The FG Düsseldorf held that the authorities were due retrospective payment of estate tax because the demolition of the house had occurred within the ten-year period. The court went on to state that even though the reasons for the demolition were understandable, no compelling reason had been presented given that personally occupying the property had still been a possibility.

Heirs should therefore tread carefully if they decide to give up the inherited family home within the ten-year period. In the absence of genuinely compelling grounds justifying this course of action, the tax authorities may come knocking at their door.

Lawyers with experience in the field of tax law can serve as advisors.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/inheritance-tax.html

]]>
ErbschaftssteuerPressemitteilungen
news-280 Fri, 08 Jan 2021 09:58:02 +0100 COVID-19 – Rent reduction in response to lockdown https://www.mtrlegal.com/en/news-and-press/detail/news/covid-19-rent-reduction-in-response-to-lockdown.html The return to a state of lockdown has hit many businesses and entrepreneurs hard. Meanwhile, the courts are arriving at different conclusions regarding whether government-mandated business closures justify rent reductions.

The period in the run up to Christmas saw the metaphorical lights go out in a lot of pedestrian zones and at many businesses, many of which have had to close due to the latest lockdown in response to the coronavirus pandemic. While businesses have experienced a drop in income during what is typically a lucrative time of year in terms of sales, their overheads – e.g. in the form of rent payments for commercial premises – are still due as usual.

Section 536(1) of the German Civil Code (Bürgerliches Gesetzbuch, BGB) provides for the possibility of rent reduction if the rented property exhibits a defect that renders it unsuitable for use in the manner defined in the relevant contract. We at the commercial law firm MTR Rechtsanwälte can report that the courts have reached different conclusions to date on whether the government-ordered lockdown constitutes grounds for rent reduction.

The Landgericht (LG) Heidelberg – the Regional Court of Heidelberg – was one of the first courts to rule in a judgment from July 30, 2020 that the coronavirus lockdown does not amount to a defect in the rented property within the meaning of the legislation (Az.: 5 O 66/20). The court held that the landlord has a duty to maintain the rented property in a condition that allows it to be used in the manner defined in the relevant contract. The government order requiring the closure of businesses in order to limit the spread of the coronavirus has nothing to do with the state of the rented property. The LG Heidelberg ruled that the risk lies with the tenant, that there is no frustration of contract based on an undermining of its commercial basis, and that the tenant is not entitled to lower the rent.

The regional courts of Zweibrücken, Frankfurt, and Oldenburg delivered similar rulings.

However, the Landgericht München – the Regional Court of Munich – arrived at a different outcome in a judgment dated September 22, 2020, ruling that commercial tenants can seek a partial but also substantial reduction in rent where stores are forced to close because of government orders or where restrictions are put in place due to the coronavirus pandemic (Az.: 3 O 4495/20). It went on to say that, depending on the scope of the restrictions, the rent can be reduced by as much 80 percent.

That rent reduction ought to be possible is a view apparently shared by Germany’s federal government. Point 15 of the joint federal and state resolution (Bund-Länder-Beschluss) of December 13, 2020 concerned with implementing stricter coronavirus measures states that where commercial tenancy and lease contracts are affected by government measures related to COVID-19, the law assumes that significant restrictions on use resulting from the coronavirus pandemic may represent a serious change to the commercial basis of the contract. The idea behind this is to facilitate negotiations between commercial tenants and landlords.

Experienced lawyers can provide counsel on legal issues pertaining to the coronavirus pandemic.

For more information:

https://www.mtrlegal.com/en/legal-advice/real-estate-and-property-law/commercial-law-of-tenancy-and-lease/corona-and-commercial-tenancy-law.html

]]>
Corona und gewerbliches MietrechtPressemitteilungen
news-279 Tue, 05 Jan 2021 15:42:27 +0100 Transfer of shares from company to private hands not an acquisition https://www.mtrlegal.com/en/news-and-press/detail/news/transfer-of-shares-from-company-to-private-hands-not-an-acquisition.html If shares that were acquired prior to 2009 are transferred from company to private hands and later sold, the profits are not to be treated as taxable income from capital investments according to the Finanzgericht (FG) Münster, the Fiscal Court of Münster.

On January 1, 2009, a flat rate withholding tax (Abgeltungssteuer) was introduced in Germany. A transfer of shares acquired prior to this cutoff date from company to private hands does not amount to an acquisition of shares. That was the verdict of the Finanzgericht Münster in a judgment from March 26, 2020 (Az.: 8 K 1192/18 F). We at the commercial law firm MTR Rechtsanwälte note that this in turn means that any future profits from the sale of such shares will not be treated as income from capital investments.

The plaintiff in the case in question was a GmbH & Co. KG – a type of German limited commercial partnership (KG) consisting of a general partner (GmbH) and a limited partner – that had acquired an equity stake in 2007. In 2011, the company brought an end to its commercial operations, declaring that it would cease trading and restrict its activities to asset management going forward. Ownership of the company’s assets, including the equity stake, was transferred to the shareholders on a pro rata basis. In 2014, the equity stake was sold. The capital gains were subsequently treated by the tax authorities as taxable profits from the investment of capital.

The plaintiff took legal action against this, arguing that because it had acquired the equity stake before the flat rate withholding tax came into force, the capital gains were not subject to taxation as per the statutory transitional arrangements. However, the tax office maintained that the transfer of the shares to private hands amounted to an acquisition.

The Finanzgericht Münster ruled in favor of the plaintiff, reasoning that while it is true that, pursuant to section 20(2) sent. 1 no. 1 of the German Income Tax Act (Einkommensteuergesetz, EStG) as amended on January 1, 2009, profits from the sale of shares are subject to taxation irrespective of the length of the retention period, according to the transitional provision this only applies to shares that were acquired after December 31, 2008. It provides that an acquisition is deemed to have taken place only if it occurs in connection with a change of legal entity. The FG Münster concluded that the cessation of commercial operations had not given rise to a change of legal entity in the instant case. This is not the final word on the matter; an appeal is pending before the Bundesfinanzhof, Germany’s Federal Fiscal Court (Az.: VIII R 12/20).

Lawyers with experience in the field of tax law can provide counsel in the event of tax disputes with the authorities.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/tax-dispute.html

]]>
SteuerstreitPressemitteilungen
news-275 Tue, 22 Dec 2020 11:33:21 +0100 Obligation to file for insolvency only suspended in cases of over-indebtedness, not illiquidity https://www.mtrlegal.com/en/news-and-press/detail/news/obligation-to-file-for-insolvency-only-suspended-in-cases-of-over-indebtedness-not-illiquidity.html There has been a limited extension until December 31, 2020 to the suspension of the obligation to file for insolvency due to the coronavirus pandemic. However, this only applies to cases of over-indebtedness, not illiquidity.

To mitigate the effects of the coronavirus pandemic and prevent a wave of insolvencies, Germany’s federal government decided in March to suspend the obligation to file for insolvency until September 30, 2020. The measure has since been extended until the end of 2020 but with an important caveat that needs to be borne in mind: the suspension of the obligation to file for insolvency is now only applicable to cases of over-indebtedness. If, however, the party in question is already insolvent (illiquidity), we at the commercial law firm MTR Rechtsanwälte would stress the importance of filing for insolvency as soon possible.

A company is deemed to be illiquid if it is no longer able to meet its payment obligations as they fall due in the form of wages, salaries, invoices, and loans. In the case of over-indebtedness, the debts exceed the total value of the company. Because there is still hope with overindebted companies of permanently averting insolvency, the obligation to file for insolvency remains suspended in these instances. Companies that already find themselves unable to pay their debts are required to file for insolvency. According to the German government, this serves to maintain the necessary level of trust in business and commerce.

Suspension of the obligation to file for insolvency for overindebted companies remains conditional on there being a causal relationship between the coronavirus pandemic and the financial difficulties. Suspension buys companies more time to consolidate their businesses.

Board members and managing directors are nonetheless well advised to precisely document the negative impact of the pandemic – in the form of outstanding payments, cancelled orders, supply shortages, etc. – in order to be able to demonstrate that COVID-19 is the reason behind the over-indebtedness.

In addition, it needs to be confirmed that there is in fact no evidence of illiquidity. The impact of the pandemic might have already resulted in a number of companies experiencing significant liquidity problems. If illiquidity is already a reality, then the insolvency paperwork must be filed without delay. If there is still legitimate hope of being able to successfully address the grounds of insolvency, filing for insolvency can be put off for up to three weeks. It is nevertheless important to always bear in mind that it is potentially a criminal offense to delay filing for insolvency.

Lawyers with experience in the field of insolvency law can advise businesses.

For more information:

https://www.mtrlegal.com/en/legal-advice/company-law/restructuring-insolvency/corona-and-insolvency-law.html

]]>
Corona und InsolvenzrechtPressemitteilungen
news-272 Fri, 18 Dec 2020 16:36:01 +0100 Law aimed at promoting fair competition passed https://www.mtrlegal.com/en/news-and-press/detail/news/law-aimed-at-promoting-fair-competition-passed.html The Bundestag and Bundesrat – Germany’s lower and upper houses of parliament respectively – have passed a law designed to promote fair competition, with the legislation expected to curb misuse of warning notices significantly.

The German government hopes that the law will ensure fair competition and curtail misuse of warning notices. To this end, the legislation provides for a reduction in financial incentives for parties seeking to obtain a warning notice, and at the same time raises the requirements for bringing such an action in the first place. It also sets out provisions that make it easier for the party on the receiving end of a warning notice to assert counterclaims. In addition, the choice of legal venue (variable place of jurisdiction) is to be restricted. We at the commercial law firm MTR Rechtsanwälte can also report that German design law will be expanded to include a repair clause.

The plans to promote fair competition include a reduction in financial incentives associated with warning notices. The legislation stipulates that competitors are not entitled to reimbursement of costs in connection with warning notices issued in response to violations of information and labeling requirements online, or violations of data protection law committed by businesses with less than 250 employees. Moreover, the extent of any contractual penalty in the case of a first warning is limited in these instances.

These changes are informed by the notion that warning notices should not be a business model. That is why only qualifying industry associations that meet certain conditions are now eligible to seek this form of redress. The legislation thus seeks to deprive disreputable or dubious industry associations of the commercial basis for misusing warning notices.

While this entails raising barriers for parties seeking to obtain written notices, it will be easier for those on the receiving end to defend themselves and expose misuse of written notices by referencing presumptive examples, including sending out mass warning notices or demanding excessive contractual penalties. Those who wrongfully receive a warning notice will also be entitled to reimbursement of the costs incurred in connection with legal representation. Parties seeking to obtain a written notice should therefore carefully examine whether their claim is justified lest it come back to bite them.

Furthermore, jurisdiction variability is to be limited. In cases involving legal infringements online and in e-commerce, the place of jurisdiction shall be the defendant’s legal venue.

An amendment has also been made to the German Act on the Legal Protection of Designs (Designgesetz, DesignG), which now features a repair clause. This opens up competition for visible replacements parts, something that may be of importance, for instance, in relation to automotive spare parts.

Lawyers with experience in the fields of antitrust and competition law can offer advice.

For more information:

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
PressemitteilungenWettbewerbsrecht
news-269 Wed, 09 Dec 2020 11:58:12 +0100 Business closure due to COVID-19 – Claims against insurer successful https://www.mtrlegal.com/en/news-and-press/detail/news/business-closure-due-to-covid-19-claims-against-insurer-successful.html An insurer was forced to indemnify a Munich restaurant for its closure due to COVID-19. The owner’s claim was successful before the Landgericht (LG) München, the Regional Court of Munich (Az.: 12 O 5868/20).

First, restaurant owners, among others, were forced to close their premises in the spring because of the coronavirus pandemic. Then the insurance companies refused to cover the losses despite the restaurateurs having taken out business closure insurance. However, insurers’ hopes of an easy ride were dashed. We at the commercial law firm MTR Rechtsanwälte can report that the Landgericht München ruled once again on October 22, 2020 that the insurer was obliged to indemnify the policyholder. This follows a ruling of the LG München from October 1 in a similar case in which the insurance company was forced to pay substantial compensation to a restaurateur from Munich.

In the instant case, the plaintiff restaurant owner had taken out business closure insurance and was subsequently forced to close the restaurant in the spring due to an order by the Bavarian State Ministry of Health and Care from March 21 in response to COVID-19. While the insurance company sought to avoid having to pay out, the LG München ruled against it.

The clause in the terms and conditions of insurance designed to limit the scope of the insurance coverage was found to lack transparency from the perspective of the policyholder and was thus deemed to be invalid. The LG München therefore concluded that the insurer would have to pay compensation in the amount of around 427,000 euros.

The court clarified that the obligation on the part of the insurer to indemnify did not depend on the legal form or legality of the closure order. Moreover, it was not necessary for COVID-19 to be present at the insured workplace. According to the general terms and condition of insurance, the only relevant factor was whether the workplace was closed based on the German Protection against Infectious Diseases Act (Infektionsschutzgesetz, IfSG). Such were the circumstances in this case, with the plaintiff’s restaurant having been completely closed and it not being reasonable to expect the business to continue operating on a legal basis as a takeaway business.

The court noted that if a clause in the general terms and conditions of insurance is to effectively limit the scope of the insurance coverage, the extent of the remaining insurance coverage needs to be made abundantly clear to the policyholder. This was not the case here.

The LG München held that neither government liquidity support related to COVID-19 nor short-time allowance were to be taken into account in determining the amount of compensation due.

A similar case saw a large restaurant and the insurance company reach an extraordinary agreement. The prospects of enforcing claims arising from business closure insurance policies continue to improve.

For more information:

https://www.mtrlegal.com/en/legal-advice/corona.html

]]>
CoronaPressemitteilungen
news-268 Tue, 08 Dec 2020 10:30:48 +0100 COVID-19 – Provider of business closure insurance must pay out https://www.mtrlegal.com/en/news-and-press/detail/news/covid-19-provider-of-business-closure-insurance-must-pay-out.html The Landgericht (LG) München – the Regional Court of Munich – recently delivered a judgment requiring an insurance company to pay out on a business closure insurance policy. The restaurant owner in question will now receive substantial compensation because of the closure of his premises due to COVID-19.

Many business owners and traders have had to close their businesses because of the coronavirus pandemic, with the food service industry, among others, having been hit particularly hard by the lockdown. But there is hope: the Landgericht München delivered a judgment on October 1, 2020 requiring an insurance company to pay substantial compensation to a restaurant owner from Munich who had taken out a business closure insurance policy with the company. The owner’s premises remained closed for 30 days due to COVID-19, with this giving rise to an indemnity claim against the insurer in the amount of around one million euros.

Insurers have to date consistently refused to indemnify policyholders for losses resulting from business closures due to COVID-19, arguing that the coronavirus is not mentioned in their business closure policies and not covered as an insured disease or illness. Insurers have also contended that businesses closures have generally not been based on the German Protection against Infectious Diseases Act (Infektionsschutzgesetz, IfSG) but on decisions of general application adopted by Germany’s federal states (Bundesländer), and thus they are not required to pay out. We at the commercial law firm MTR Rechtsanwälte can report, however, that these arguments have since been dealt a heavy blow by the Landgericht München.

In the case in question, the restaurateur was forced to close his premises based on a decision of general application adopted by the Bavarian state government on March 21, 2020 in response to COVID-19. The restaurant was subsequently reopened in mid-May. It was only at the beginning of March that the restaurant owner, particularly in view of the coronavirus pandemic, took out business closure insurance. The insurer did not wish to pay out on the policy, reasoning, among other things, that the owner needed to have first taken action against the state government’s ordinance.

This line of reasoning was rejected by the LG München. The court held that the matter did not turn on the legality of the order or the legal form of the decision of general application, and that it had therefore not been necessary for the restaurateur to take action against the order. The obligation on the part of the insurer to indemnify was also not conditional on COVID-19 being present in the workplace. Moreover, the court found that the business had in fact been closed based on the Infektionsschutzgesetz, noting that the Bavarian Ministry of Health made explicit reference to the enabling provisions of the IfSG in adopting its decision of general application. It went on to point out that even with the help of takeaway business, the owner would not have been able to keep the business open.

While the ruling is not yet final, it may nonetheless pave the way for many other claims against insurance companies offering business closure policies.

For more information:

https://www.mtrlegal.com/en/legal-advice/corona.html

]]>
CoronaPressemitteilungen
news-264 Tue, 01 Dec 2020 12:40:20 +0100 BFH on taxable income from interest in connection with transfer of house along with plot of land in return for annuity payments https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-on-taxable-income-from-interest-in-connection-with-transfer-of-house-along-with-plot-of-land-in.html According to the Bundesfinanzhof (BFH) – Germany’s Federal Fiscal Court – transferring a plot of land at a discount in the context of anticipated succession in return for annuity payments gives rise to taxable income from interest.

The scenario is not uncommon: the children get a plot of land along with a building within the framework of anticipated succession, whereas the parents receive monthly annuity payments. But beware: we at the commercial law firm MTR Rechtsanwälte note that the parents may accrue taxable income from interest under this arrangement.

Such were the circumstances in a case adjudicated by the Bundesfinanzhof on June 14, 2020 (Az.: VIII R 3/17). The plaintiffs – a jointly assessed married couple – had transferred a plot of land along with a house to their son and the wife in return for annuity payments in the amount 1,000 euros per month. The payments were to be made over a period of 30 years.

The tax authorities identified income from interest in connection with the annuity payments that it found was subject to income tax. The parents took legal action against this finding, arguing that the annuity payments ought not to be divided up into a repayment and an interest portion. They claimed to have deliberately transferred the property in return for low annuity payments over a long period of time, and thus ultimately below market value, in consideration of their son’s financial standing. In doing so, they were intentionally forgoing income for the financial benefit of their son and the wife. For this reason, the annuity payments did not include taxable income from interest.

Their claim was unsuccessful. The BFH found that this did not constitute a gratuitous transfer of inheritance. Notwithstanding the fact that the transfer had taken place at below market value, it still constituted a sales transaction that was subject to income tax.

The BFH went on to state that annuity payments from a sale-related annuity certain are to be divided up among the buyer and the seller into a repayment and an interest portion in accordance with section 13(1) of the German Valuation Act (Bewertungsgesetz, BewG), with the repayment portion equaling the present value of the basic pension entitlement, which is ascertained by discounting all outstanding instalments. The court held that the seller obtains taxable income from interest that amounts to the difference between the present value of the pension claim and the respective annuity payment. The BGH concluded that with the annuity payments in the relevant year amounting to 12,000 euros, the interest portion and the taxable interest income in this case was 9,420 euros.

Lawyers with experience in the field of tax law can offer advice.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/tax-dispute.html

]]>
Steuerstreit
news-263 Wed, 25 Nov 2020 10:32:34 +0100 German patent law draft modernization act approved https://www.mtrlegal.com/en/news-and-press/detail/news/german-patent-law-draft-modernization-act-approved.html German patent law is set to become simpler and more modern. On October 28, 2020, Germany’s federal cabinet approved the second draft of the act designed to simplify and modernize German patent law.

The federal government wants to further strengthen intellectual property rights in connection with the protection of industrial property. To this end, the federal cabinet has now approved the second draft of the act designed to simplify and modernize German patent law (“Zweites Gesetz zur Vereinfachung und Modernisierung des Patentrechts”). We at the commercial law firm MTR Rechtsanwälte can report that the act is likely to enter into force at the beginning of 2021.

The planned law addresses two main areas: it provides for an exceptional restriction on injunctive relief under patent law on grounds of proportionality. It also seeks to expedite patent nullity proceedings by enabling greater synchronicity between infringement and nullity actions, and to improve the protection of confidential information in patent litigation.

The new rules governing injunctive relief in response to patent and utility model infringements are meant to give greater prominence to the principle of proportionality by providing for the possibility of exceptional restrictions on injunctive relief due to particular circumstances in individual cases where claiming relief would lead to disproportionate and – because of the right of exclusivity – unjustified hardship for the infringing party.

The amended legislation also envisages procedural changes with respect to nullity proceedings before Germany’s Federal Patent Court, the Bundespatentgericht. It includes provisions aimed at, among other things, expediting proceedings by empowering the Bundespatentgericht to issue its indicative ruling pursuant to section 83 of the German Patent Act (Patentgesetz, PatG) to the court hearing the infringement dispute after only six months. To this end, the proceedings before the Bundespatentgericht between service of process and qualified indicative ruling are to be streamlined. The patent holder will still be able give its account within one month of the action for annulment being served. What is new is that there will be an additional period of one month for justifying the objection. The Bundespatentgericht then has a further four months in which to deliver the qualified indicative ruling.

There are also specific provisions dedicated to improving the protection of confidential information that deal with the protection of trade secrets in patent, utility model, and semi-conductor protection litigation.

Other changes aim to simplify and clarify, including plans to align trademark law with the current legal framework under the Madrid System for the International Registration of Marks.

Lawyers with experience in the field of IP law can offer advice.

For more information:

https://www.mtrlegal.com/en/legal-advice/ip-law.html

]]>
IP RechtPressemitteilungen
news-261 Fri, 20 Nov 2020 11:47:10 +0100 Taxable income from renting via Airbnb – Possibility of voluntary disclosure https://www.mtrlegal.com/en/news-and-press/detail/news/taxable-income-from-renting-via-airbnb-possibility-of-voluntary-disclosure.html Rental income is subject to tax. Those renting out apartments via platforms such as Airbnb need to be mindful of this if they are to avoid committing tax evasion.

Income from renting and leasing is subject to tax. This applies to both real estate companies and private landlords, even if they only occasionally rent out a room or an apartment through Airbnb. The rental income needs to be included in the relevant income tax declaration. Concealing these earnings risks trouble with the tax authorities and allegations of tax evasion. Under these circumstances, those renting out real estate ought to review their legal options, including voluntary disclosure.

Sharing is the order of the day, and this is particularly noticeable in the case of apartments. People who are not using their apartment for a time or who have an empty room are subletting them for a limited period using portals such as Airbnb. While the parties renting out the properties are pleased about the extra income, many of them are not aware that this income is subject to tax if it exceeds the nugatory threshold of 520 euros per annum.

These rental arrangements have not escaped the attention of the German tax authorities, which now require Airbnb to hand over the data. The Hamburg Tax Investigation Office announced at the beginning of September that it has now received the data and will make it available to the relevant state tax authorities.

Lessors who have concealed this rental income are thus potentially facing not only the inconvenience of having to pay tax arrears but also the prospect of tax evasion proceedings. That is why it is vital to take swift action now and assess whether it is still possible to submit a voluntary declaration for tax evasion.

Such a voluntary declaration can only lead to exemption from punishment if the tax evasion has yet to be discovered. If the data from Airbnb has already been received and evaluated by the relevant tax office, this precludes voluntary disclosure from being fully effective. A voluntary declaration can nevertheless still have a mitigating effect on punishment. In addition, it is important for the voluntary declaration to be complete and include all the relevant tax-related information pertaining to the past ten years.

However, it is almost impossible for someone who is not an expert to satisfy these requirements. Lawyers with experience in the field of tax law would be more than happy to assist you in preparing an effective volunta declaration.

For more information:

https://www.mtrlegal.com/en/legal-advice/tax-law/voluntary-disclosure.html

]]>
SelbstanzeigePressemitteilungen
news-258 Tue, 10 Nov 2020 10:01:44 +0100 Wirecard AG – Shareholders can register claims in insolvency proceedings https://www.mtrlegal.com/en/news-and-press/detail/news/wirecard-ag-shareholders-can-register-claims-in-insolvency-proceedings.html Insolvency proceedings concerning Wirecard AG were opened on August 25, 2020 (Az.: 1542 IN 1308/20). Creditors had until October 26, 2020 to register their claims with the insolvency administrator.

Wirecard AG filed for insolvency at the end of June. Two months later, insolvency proceedings were opened at the Amtsgericht München – the District Court of Munich – concerning the company and six subsidiaries. For Wirecard AG’s shareholders and investors, the bankruptcy of the former DAX-listed company brings with it the prospect of significant financial losses. Following the opening of insolvency proceedings, they were then able to register their claims in the insolvency schedule as a means of at least partially offsetting their losses.

Claims brought by shareholders in insolvency proceedings are normally treated as low priority, i.e. they are right at the bottom of the list of creditors. However, since the situation with Wirecard is shaping up to be a real accounting scandal and economic crime thriller, with the public prosecutor’s office investigating, among other things, possible fraud and market manipulation, low priority status may well be inapplicable in this instance. For this reason, it is as important for shareholders to register their claims in writing with the insolvency administrator by October 26, 2020 lest they come away empty-handed. We at the commercial law firm MTR Rechtsanwälte note, however, that the claims need to be properly justified rather than simply taking a blanket approach.

Even if the insolvency administrator endeavours to arrange Wirecard AG or parts of the business in a manner that is attractive to buyers and investors and to increase the size of the insolvency estate, the creditors should not hold out too much hope of receiving a large insolvency dividend given that the company is substantially overindebted.

This means that the insolvency dividend can only be expected to partially compensate for the financial losses incurred. To further reduce these losses, claims for damages can also be asserted independently of the insolvency proceedings.

Apart from the alleged offenders, the former members of Wirecard AG’s executive and supervisory boards are also potential candidates against whom claims for damages may be asserted. Given that fraudulent accounting appears to have been practiced since as early as 2015, it ought to be assessed whether they failed to live up to their supervisory responsibilities. It may also be possible to bring claims for damages against the auditors who regularly issued audit certificates over the years despite the balance sheet irregularities.

Lawyers with experience in the field of capital markets law can review Wirecard investors?’ claims for damages.

For more information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/wirecard-ag.html

]]>
Wirecard AGPressemitteilungen
news-256 Thu, 29 Oct 2020 13:29:02 +0100 OLG Köln on standards for advertisements featuring “Testsieger” https://www.mtrlegal.com/en/news-and-press/detail/news/olg-koeln-on-standards-for-advertisements-featuring-testsieger.html Anyone promoting products or services using the accolade “Testsieger” (test winner) must also provide a source reference for the test. Important information is otherwise being withheld from consumers according to the Oberlandesgericht (OLG) Köln – the Higher Regional Court of Cologne.

The use of test results in product advertising is popular due to the considerable influence test certifications can have on consumers’ purchasing decisions. This is particularly true of tests conducted by prestigious bodies or organizations. That is why the legislature has established strict requirements for advertisements that make reference to test winners. We at the commercial law firm MTR Rechtsanwälte note that failure to comply with these requirements means the advertising is in breach of competition law.

Advertisements featuring test results must be transparent to consumers, who need to be able to make sense of the test and its criteria. According to a ruling of the OLG Köln from July 10, 2020, such adverts must therefore include a source reference for the test (Az.: 6 U 284/19).

In the instant case, a DIY store had been promoting a wall paint in a prospectus using the accolade “Testsieger”. While the seal for the relevant test certification from the German consumer organization Stiftung Warentest appeared on the bucket of paint, the same could not be said of a source reference for the test. The OLG Köln deemed this a breach of competition law, reasoning that the absence of a source reference meant that important information was being withheld from consumers and that the advertising was thus in breach of the German Unfair Competition Act (Gesetz gegen den unlauteren Wettbewerb, UWG).

The court noted that the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – has already clarified in a number of rulings that test ratings featured in advertisements must be clearly and easily verifiable. This includes citing a source reference that is easy for consumers to find so that they can scrutinize and make sense of any advertisements informed by the test in question. The OLG went on to explain that certain criteria can play a crucial role in informing consumers’ purchasing decisions – in the case of paints, for example, the coverage – whereas other factors only play a minor role.

In the case at issue, the Testsieger seal was only visible as part of the product illustration and thus not emphasized separately. The court noted that it remains an open question whether this constitutes Testsieger advertising, and therefore granted leave to appeal to the BGH.

Violations of competition law can give rise to injunction suits and claims for damages. Lawyers with experience in the field of competition law can offer advice.

For more information:

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
WettbewerbsrechtPressemitteilungen
news-255 Fri, 23 Oct 2020 12:19:15 +0200 FG Münster: No capital gains tax due on furniture and fittings from sale of real estate https://www.mtrlegal.com/en/news-and-press/detail/news/fg-muenster-no-capital-gains-tax-due-on-furniture-and-fittings-from-sale-of-real-estate.html Furniture and fittings do not count towards capital gains from the sale of real estate. That was the verdict of the Finanzgericht (FG) Münster – the Fiscal Court of Münster – in a ruling form August 3, 2020 (Az.: 5 K 2493/18).

If a property that is not occupied by its owner is sold at a profit within a period of ten years from its acquisition, the profits are subject to capital gains tax. We at the commercial law firm MTR Rechtsanwälte note that it is only following a holding period of ten years that no capital gains tax is due on the profits. If, however, the furniture and fittings are sold along with the property, these are not subject to taxation as a private sales transaction.

In the instant case, the plaintiff had purchased and began renting out a vacation property in 2013. In 2016, he sold the property together with the furniture and fittings. The contract of sale provided for a pro rata purchase price of 45,000 euros for the latter.

When determining the amount of taxable capital gains, the tax office factored in the 45,000 euros for the furniture and fittings. Citing section 23(1) para. 1 no. 2 sentence 4 of the German Income Tax Act (Einkommensteuergesetz, EStG), it concluded that the ten-year speculation period should equally apply to these assets, as income from renting and leasing had been generated from the furniture and fittings.

The plaintiff opposed this decision, arguing that as everyday objects these were not subject to taxation.

The Finanzgericht Münster found in the plaintiff’s favor, ruling that no tax liability arose in respect of the furniture and fittings. The court noted that section 23(1) para. 1 no. 2 sentence 4 EStG merely results in an extension of the speculation period from one to ten years for certain assets; the provision does not, however, in and of itself constitute a basis for taxation. It also pointed out that everyday objects are exempt from taxation. The FG Münster then went on to state that the definition of everyday objects also encompasses home furnishings, since furniture and fittings do not usually increase in value.

A number of different tax rules and particularities need to be observed when buying or selling real estate. Lawyers with experience in the field of tax law would be happy to advise you even in the event of legal disputes with the tax authorities.

For more Information:

https://www.mtrlegal.com/en/legal-advice/tax-law/tax-dispute.html

]]>
SteuerstreitPressemitteilungen
news-253 Wed, 21 Oct 2020 11:48:56 +0200 OLG Frankfurt on indication of origin for sparkling wine from Italy https://www.mtrlegal.com/en/news-and-press/detail/news/olg-frankfurt-on-indication-of-origin-for-sparkling-wine-from-italy.html Sparkling wine whose second fermentation phase occurs in Spain can still be advertised as a product that comes from Italy. That was the verdict of the Oberlandesgericht (OLG) Frankfurt – the Higher Regional Court of Frankfurt – in a ruling from September 11, 2020 (Az.: 6 W 95/20).

A sparkling wine can be designated as an Italian product if the grapes were harvested and made into wine in Italy, even if the second phase of fermentation and the associated further processing involved in turning the base wine into sparking wine takes place in another country (in this case Spain). That was the verdict of the OLG Frankfurt in the expedited proceedings, which saw the court dismiss the complaint lodged by a wine producer.

While consumers must not be misled by indications of origin, it is generally not necessary for the entire production process to take place in a single country. We at the commercial law firm MTR Rechtsanwälte can report that the ECJ has already decided as much, for instance, in a case involving mushrooms from Germany.

In the case before the OLG Frankfurt, a winery had been promoting its sparkling wine as an Italian product, yet Italy was only the location where the grapes were being harvested and made into wine. The second fermentation phase and the further processing involving turning the base wine into sparkling wine was taking place in Spain. A competitor therefore concluded that promoting the product as wine from Italy was misleading and in breach of competition law.

However, the OLG Frankfurt took a different view, ruling that the use of “Italien” (Italy) as an indication of origin for the sparkling wine was accurate. The court noted that the grapes were being harvested and made into wine in Italy and that further processing in another country did not change this fact. It held that the wording “zu Wein verarbeitet” (made into wine) was not necessarily a reference to the final product.

Alternatively, the location of the second phase of fermentation (in this case Spain) could have been specified as the country of origin. The OLG Frankfurt went on to explain that the indication of origin required by EU law should cite either the county where the grapes were harvested and made into wine or the country in which the wine underwent further processing to become sparkling wine. The court ruled that it was not the intention of the legislature for all the processing to take place in a single country for an indication of the origin to be valid.

Experienced lawyers can advise on issues relating to indications of origin as well as antitrust and competition law more broadly.

For more information:

https://www.mtrlegal.com/en/legal-advice/competition-law.html

]]>
WettbewerbsrechtPressemitteilungen
news-251 Wed, 14 Oct 2020 11:52:38 +0200 OLG München: Golden color not protected as trademark acquired through use https://www.mtrlegal.com/en/news-and-press/detail/news/olg-muenchen-golden-color-not-protected-as-trademark-acquired-through-use.html The golden color of a chocolate Easter bunny is not protected as a color mark. The Oberlandesgericht (OLG) München – the Higher Regional Court of Munich – found that the producer in question did not enjoy any trademark rights in relation to the color.

In the weeks leading up to Easter, supermarket shelves are stacked with chocolate bunnies. One producer has been packaging its chocolate bunnies in a gold-colored foil for many years. We at the commercial law firm MTR Rechtsanwälte can report, however, that the longstanding use of this color has not given rise to any rights under trademark law. That was the verdict of the OLG München in a ruling from July 30, 2020 (Az.:29 U 6389/19).

The producer has been selling its chocolate Easter bunnies in packaging featuring this golden color for many years. After discovering that a competitor had also placed chocolate bunnies in gold packaging on the market, it decided to file a lawsuit, arguing that the competitor’s conduct infringed its trademark rights.

Yet, in doing so, it did not assert rights arising from its registered color mark but instead invoked an abstract color mark, claiming that consumers would associate chocolate bunnies in this golden color primarily with its products and that the color, having established itself, was protected as a trademark through use.

While the Landgericht München – the Regional Court of Munich – followed this line or reasoning, the OLG München took a different view, ruling that while abstract color marks may enjoy protection as trademarks through use if they acquire a secondary meaning, the plaintiff had failed to meet this condition for the golden color that it was using in the packaging of its chocolate bunnies.

The Court went on to state that in cases where it has already been accepted that a particular color mark has acquired a secondary meaning, the color forms part of the company’s corporate brand for its various products and services. This was found not to be the case here. The OLG held that the golden color in this case was only being used for the varying sizes and flavors of a particular product, noting that consumers were also familiar with the shape of this chocolate bunny. The Court concluded that chocolate bunnies which are packaged in gold foil but that otherwise have an entirely different appearance are not likely to be associated by consumers with the plaintiff’s products. The color was found not to have acquired a secondary meaning and thus had not been used as a trademark. The OLG has granted leave to appeal to the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court.

Lawyers with experience in the field of IP law can offer comprehensive advice on all issues pertaining to trademark law.

For more information:

https://www.mtrlegal.com/en/legal-advice/ip-law/trademark-law.html

]]>
MarkenrechtPressemitteilungen
news-250 Tue, 13 Oct 2020 12:35:39 +0200 Wirecard AG – Claims for damages against corporate bodies and auditors https://www.mtrlegal.com/en/news-and-press/detail/news/wirecard-ag-claims-for-damages-against-corporate-bodies-and-auditors.html With Wirecard AG now insolvent, investors are potentially facing severe losses. Shareholders and investors in Wirecard bonds and derivatives can assert claims for damages.

While the extent of Wirecard creditors’ losses is as yet incalculable, the liabilities of the former DAX-listed company are likely to be enormous. Media reports are quoting a figure of 1.6 billion euros in bank loans alone. This amount does not include the value of claims brought by other creditors, not to mention the 500 million euros’ worth of bonds that Wirecard only issued in September of 2019.

In light of these significant liabilities, even selling lucrative parts of the business is unlikely to substantially improve the situation for Wirecard investors. The insolvency estate is also unlikely to be large enough to satisfy creditors’ claims. Wirecard shareholders ought to be worried about the prospect of losing all their money considering that their claims will be treated as low priority in insolvency proceedings, i.e. right at the bottom of the priority list. While things look a little rosier for bond investors, they too should anticipate severe financial losses in the course of insolvency proceedings.

Claims can be included in the insolvency schedule once the court has decided to open insolvency proceedings. Investors should then be sure to register their claims in the insolvency schedule as well. We at the commercial law firm MTR Rechtsanwälte note that they can also respond to the looming financial losses facing them by having someone review the possibility of asserting claims for damages.

A few days prior to filing for insolvency, Wirecard AG was forced to admit that 1.9 billion euros it supposedly held in escrow accounts in the Philippines probably do not exist. With the Munich Public Prosecutor’s Office having already opened investigations on suspicion of market manipulation due to allegedly false information, the scope of the investigations has since been expanded.

Given that balance sheet figures were clearly inflated, claims for damages may have arisen against members of Wirecard AG’s executive and supervisory boards, the liability of whom may extend to their private assets. Claims against the auditors are also a possibility. They have been issuing audit opinions for the annual balance sheets over the years despite these seemingly featuring spurious figures.

Lawyers with experience in the field of capital markets law can review Wirecard investors’ claims for damages.

For more Information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/wirecard-ag.html

]]>
Wirecard AGPressemitteilungen
news-248 Wed, 07 Oct 2020 11:53:12 +0200 Rocket Internet delists its shares – Shareholders facing huge losses https://www.mtrlegal.com/en/news-and-press/detail/news/rocket-internet-delists-its-shares-shareholders-facing-huge-losses.html Rocket Internet has decided to delist its shares, with the shareholders having approved the buyback offer at the extraordinary general meeting held on September 24, 2020.

The move came as little surprise following repeated speculation surrounding Rocket Internet’s delisting. It is expected to be effected by as early as November after around 81 percent of the shareholders approved the buyback offer, a result that was to be expected given that the founder and CEO of the company owns a large portion of the shares.

For shareholders, these events are anything but a cause for celebration. The company’s delisting confirms their losses, with the SDAX-listed share quoting at 60 percent below the issue price. Rocket Internet has now offered to buy back the shares at a price of 18.57 euros per share. That is the legal minimum price and roughly equal to the current share price, a bitter pill for investors to have to swallow. We at the commercial law firm MTR Rechtsanwälte note that this raises the question of why Rocket Internet’s stock performance has been so unsatisfactory.

Even though the buyback offer of 18.57 euros per share corresponds to the average share price over the past six months, many investors believe the shares to be worth significantly more, referencing valuations made by analysts. They feel like they have been conned.

Criticism of the approach taken by Rocket Internet and of its co-founder is mounting, particularly as the founder’s shares are not affected by the buyback offer. This may be in breach of the principle of equal treatment.

Signs pointing to Rocket Internet’s delisting have been around for some time, meaning the founders could have accounted for the company’s modest performance on the stock exchange and the falling share price. A planned buyback undermines the logic behind any efforts to drive up the share price again.

While investors who opt not to accept the buyback offer do not have to sell their shares, these will likely no longer be tradeable on the German stock exchange and instead only on smaller regional exchanges with significantly less trading activity.

Investors who wish to have someone review their legal options can turn to lawyers with experience in the field of stock corporation law.

For more information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/stock-corporation-law.html

]]>
AktienrechtPressemitteilungen
news-242 Mon, 21 Sep 2020 09:32:52 +0200 Wirecard AG – Investigations on suspicion of market manipulation https://www.mtrlegal.com/en/news-and-press/detail/news/wirecard-ag-investigations-on-suspicion-of-market-manipulation.html The Munich Public Prosecutor’s Office has conducted a search of Wirecard’s head office in Aschheim near Munich on suspicion of market manipulation.

The raid that took place at Wirecard’s head office on June 5, 2020 appears to have been in response to a criminal charge lodged by the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) – Germany’s Federal Financial Supervisory Authority – concerning ad-hoc announcements made by the company on March 12 and April 22 of this year. When considered in connection with a special report produced by the auditors, these announcements may have given misleading signals with respect to the market price of Wirecard shares. They could give the impression that accusations relating to various accounting irregularities might be refuted by the special report.

Wirecard has come under fire for alleged accounting irregularities for some time now. The company has consistently rejected the accusations made against it. In the interest of clarity, the payment services provider decided to task an auditing firm in the fall of 2019 with conducting an independent special investigation. Following multiple delays, the report was submitted on April 28, 2020. It lays out an entire list of criticisms. Wirecard’s share price subsequently experienced a significant drop in value.

According to media reports, the auditors accused Wirecard of having delayed the investigations and belatedly made documents available in some cases and not at all in others.

The ad-hoc announcements made prior to the publication of the special report paint a different picture. The shareholders are now faced with the question of whether they ought to feel reassured or deceived by these announcements. Members of the executive board are therefore being investigated on suspicion of market manipulation.

Wirecard stresses that it is the board members and not the company which are the subject of these investigations, noting that the annual and consolidated financial statements for 2019 are expected to be released on June 18, 2020 as planned.

This is reassuring news for shareholders of Wirecard AG. We at the commercial law firm MTR Rechtsanwälte note that if the company has failed to comply with its reporting obligations vis-à-vis its shareholders, providing inaccurate or incomplete information, this may give rise to claims for damages.

Investors are already piling pressure on the company, accusing it of potentially supplying erroneous information. In addition, a formal request has been submitted to open model case proceedings pursuant to the German Capital Markets Model Case Act (Kapitalanleger-Musterverfahrensgesetz, KapMuG).

Lawyers with experience in the fields of capital markets and stock corporation law can assist shareholders of Wirecard AG in enforcing their rights.

For more information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/wirecard-ag.html

]]>
AktienrechtPressemitteilungenWirecard AG
news-241 Wed, 16 Sep 2020 10:01:21 +0200 Wirecard AG files for insolvency – Options available to investors https://www.mtrlegal.com/en/news-and-press/detail/news/wirecard-ag-files-for-insolvency-options-available-to-investors.html The accounting scandal facing Wirecard AG has ended in insolvency for now. Those who invested in Wirecard stocks and bonds find themselves faced with the question of whether they can claim damages.

The writing was clearly on the wall when Wirecard AG failed once again to present its annual and consolidated financial statements for 2019, with the auditors refusing to issue an audit opinion and the company shortly thereafter announcing that 1.9 billion euros supposedly held in escrow accounts in the Philippines probably do not exist. Wirecard AG later announced on June 25 that it was submitting paperwork to the Amtsgericht München – the District Court of Munich – to open insolvency proceedings due to impending insolvency and over-indebtedness.

Wirecard AG’s meteoric rise to the heights of the DAX is matched only by its dramatic fall. Once worth almost 200 euros, a single share is valued today at less than one euro. For those holding shares or bonds in the company, the collapse in value entails severe financial losses.

Wirecard shareholders cannot file to have their claims included in the insolvency schedule until insolvency proceedings have been officially opened. However, those anticipating a high insolvency dividend should not get their hopes up; shareholder claims will be treated as low priority, i.e. the claims of the other creditors will be given priority. While things look a little rosier for bond investors in this respect, they too should not expect to receive a large payout in the course of insolvency proceedings.

We at the commercial law firm MTR Rechtsanwälte note that Wirecard investors can assert claims for damages as a means of minimizing financial losses, citing a breach of the German Securities Trading Act (Wertpapierhandelsgesetz, WpHG). Wirecard may have breached its reporting obligations by including false information in mandatory stock market disclosures. Investigations by the Munich Public Prosecutor’s Office due to suspected market manipulation are already underway.

Following the events of the past few days, the scope of these investigations has widened. In addition to inflated balance sheet figures and blatant incongruities, suspected fraud is now also part of the equation. This means that board members and those responsible at Wirecard are facing possible claims for damages. The auditors who apparently rubber-stamped the balance sheets over the years, despite them showing sums that clearly never existed, may be facing the same fate.

Wirecard investors can turn to lawyers with experience in the fields of capital markets and stock corporation law.

For more information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/wirecard-ag.html

]]>
AktienrechtPressemitteilungenWirecard AG
news-239 Mon, 14 Sep 2020 09:38:36 +0200 Scale of Wirecard AG accounting scandal grows https://www.mtrlegal.com/en/news-and-press/detail/news/scale-of-wirecard-ag-accounting-scandal-grows.html The scale of the accounting scandal besetting Wirecard AG continues to grow. Wirecard’s running assumption is that 1.9 billion euros supposedly held in escrow accounts likely never existed. The company has experienced a dramatic drop in the value of its shares.

Wirecard AG has been the subject of criticism due to accounting irregularities for some time now. Seeking to dispel doubts, the payment services provider had planned on presenting its annual and consolidated financial statements on June 18, 2020 following multiple delays. Yet this too came to nothing. The reason: a lack of evidence corroborating bank account balances to the tune of 1.9 billion euros, an amount equivalent to around a quarter of the group’s total assets that was supposedly lying in escrow accounts at Asian banks.

According to an announcement made by the company on June 22, 2020, Wirecard now fears that the 1.9 billion euros in all probability does not exist. Until this point in time, the DAX-listed company had been operating on the assumption that the accounts did exist, presenting them as assets on its balance sheets. The banks in the Philippines had previously stated that Wirecard AG was not a client of theirs and that documents potentially showing balances on accounts at their banks must have been falsified.

The repercussions have been severe. Wirecard subsequently withdrew its estimated preliminary earnings for 2019 and the first quarter of 2020, it also not being possible to rule out an impact on previous years’ financial statements. The former chief executive and another board member have since resigned from their posts. After failing to present the annual accounts on June 18, Wirecard announced charges against persons unknown, presenting itself as a possible victim of “gigantic fraud.”

The Munich Public Prosecutor’s Office is already investigating four board members on suspicion of market manipulation, two of whom are no longer in their posts.

Faced with one bad headline after another, Wirecard’s share price has fallen sharply. We at the commercial law firm MTR Rechtsanwälte note that shareholders have the option of asserting claims for damages. These claims may have arisen due to the company having failed to meet its reporting obligations and making false or incomplete disclosures. They may also stem from inaccurate information in the balance sheets, it potentially being possible to direct such claims against the company’s auditors.

Shareholders of Wirecard AG can turn to lawyers with experience in the fields of capitals markets and stock corporation law.

For more information:

https://www.mtrlegal.com/en/legal-advice/capital-markets-law/stock-corporation-law.html

]]>
AktienrechtPressemitteilungen
news-237 Thu, 10 Sep 2020 14:29:54 +0200 New attempt to establish Unified Patent Court https://www.mtrlegal.com/en/news-and-press/detail/news/new-attempt-to-establish-unified-patent-court.html There is a desire for the process of issuing patents within the EU to be made more efficient. The idea of establishing a Unified Patent Court is seen as a positive step in this direction. The Bundesministerium der Justiz und für Verbraucherschutz (BMJV) – Germany´s Federal Ministry of Justice and Consumer Protection – has submitted a new bill as part of a second attempt to do so.

The plan is for there to be a Unified Patent Court to deal with disputes concerning the infringement and validity of European patents, with courts of first instance established in the Members States and a court of appeal set up in Luxembourg. A broad consensus has emerged in Germany in favor of participating in the Agreement on a Unified Patent Court, with the German Bundestag having already passed legislation designed to enact the agreement. Yet in March of 2020, the Bundesverfassungsgericht – Germany’s Federal Constitutional Court – decided to throw a spanner in the works (Az.: 2 BvR 739/17).

We at the commercial law firm MTR Rechtsanwälte can report that the court declared the legislation null and void, ruling that despite being passed unanimously by the Bundestag, the mere 35 members of Germany´s lower house of parliament present at the vote did not satisfy the requirement for there to be a two-thirds majority.

The BMJV is now making a second go of it, introducing a new bill on June 10, 2020. According to the Ministry, the proposal for remedying the procedural irregularity admonished by the Bundesverfassungsgericht is for the legislation designed to enact the international agreement to be passed by the Bundestag and Bundesrat with the required majority.

The Agreement on a Unified Patent Court has since been ratified by 15 EU Member States. In order for it to come into force, it must still be approved by Germany.

Should the agreement enter into force, the Unified Patent Court will adjudicate on the infringement and validity both of European patents under the terms of the European Patent Convention and European patents with unitary effect (“Unitary Patents”). The plan is for courts of first instance to be established in Germany in Düsseldorf, Hamburg, Mannheim, and Munich.

In this way, the process of issuing patents in the EU is supposed to become more efficient. While it has up till now been possible for decisions on patent applications to be taken centrally by the European Patent Office, the patents still need to be approved by each EU Member State in order for them to become effective. The aim is now for the European Patent Office to be able to issue Unitary Patents that apply automatically throughout the EU. The reforms also include the establishment of a Unified Patent Court.

Lawyers with experience in the field of IP law can advise on issues relating to patents.

For more information:

https://www.mtrlegal.com/en/legal-advice/ip-law.html

]]>
IP RechtPressemitteilungen
news-236 Wed, 02 Sep 2020 11:09:40 +0200 BGH upholds trademark protection for square design https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-upholds-trademark-protection-for-square-design.html In rulings from July 23, 2020, the Bundesgerichtshof (BGH) – Germany´s Federal Supreme Court – confirmed that three-dimensional forms, including the shape or packaging of goods, are capable of benefiting from trademark protection (Az.: I ZB 42/19 and I ZB 43/19).

They can often be found close to each other on the supermarket shelves. One has a square design, the other has a rectangular shape. The producer of the square product had the shape of the packaging registered as a trademark, much to the displeasure of the other producer, which has been trying to have the registration cancelled for years. But these efforts have ultimately been in vain. The BGH has since ruled that the cancellation requests were unfounded and the three-dimensional shape marks continue to benefit from trademark protection.

According to Section 3 of the German Trademark Act (Markengesetz, MarkenG), any sign that is capable of distinguishing the goods or services of one enterprise from those of other enterprises is eligible for trademark registration. This also covers the shape of goods, including their packaging. We at the commercial law firm MTR Rechtsanwälte note, however, that trademark registration may be precluded by grounds for refusal if the signs consist exclusively of shapes or other distinctive features that give substantial value to the goods.

Yet this was not the case with respect to the square shape and packaging of the goods in the legal dispute in question according to the BGH. The registered trademarks were deemed not to consist exclusively of a shape that gave substantial value to the goods. The court held that the only essential feature of the trademark-registered packaging was its square background, which it found did not give substantial value to the product.

The BGH went on to list the key factors that inform this necessary assessment as the product category type, the artistic value of the design, its distinctiveness in comparison to other designs used, a significant difference in price vis-à-vis similar products, and a marketing strategy whose primary focus is the product´s aesthetic qualities.

It ruled that there can be said to be grounds for refusal if objective and reliable sources would conclude that consumers´ decision to purchase the relevant product primarily comes down to this feature. However, the BGH found that this was not the case here, reasoning that consumers perceived the square shape as more of an indication of the goods´ origin, thus giving rise to certain expectations as to quality in their minds. But the design did not give substantial value to the product. Accordingly, the court found there to be no obstacle precluding trademark registration.

For more information:

https://www.mtrlegal.com/en/legal-advice/ip-law/trademark-law.html

]]>
MarkenrechtPressemitteilungen
news-234 Mon, 31 Aug 2020 09:36:28 +0200 COVID-19 – Substandard Quality of Masks and Other Protective Equipment https://www.mtrlegal.com/en/news-and-press/detail/news/covid-19-substandard-quality-of-masks-and-other-protective-equipment.html The coronavirus pandemic is not over. Respiratory masks and other protective gear remain vital. However, the issues of quality and outstanding invoices are also increasingly taking center stage.

The global number of coronavirus infections continues to increase, with the number of people infected with COVID-19 rising once again in Germany. The Robert Koch Institute cites people’s failure to continue to sufficiently abide by social distancing and hygiene measures as the principal cause. Those returning from vacation were said to be only a minor contributor to this trend.

With the increase in the number of coronavirus infections, the issue of protective equipment in healthcare, the workplace, and in private settings is gaining prominence once more. This also includes – in addition to the classic masks that cover the mouth and nose – for example, protective gowns, protective goggles, and disposable gloves.

When the crisis surrounding the coronavirus first took root in Germany, protective equipment was in short supply due to high demand. Even disreputable providers who were bringing the classic masks and other protective gear of poor quality to market have been prompted to take action in response to the supply bottlenecks.

The has led to retailers increasingly experiencing difficulties in the form of their customers bringing claims for damages against them due to the poor quality of the goods. The retailers themselves may be able to assert claims for damages against their suppliers. We at the commercial law firm MTR Rechstanwälte note that in order for this to happen, the contracts need to be carefully reviewed and the details clarified for whether the goods satisfy the level of quality that was agreed.

It is generally important to ensure that masks as well as any other protective gear come with the necessary certificates. Respiratory masks usually have to comply with European Regulation 2016/425/EU on personal protective equipment (PPE). The coronavirus crisis has seen protective equipment deemed acceptable despite a lack of appropriate documentation if it meets the standards of protection in the U.S., Canada, Australia, or Japan. At the same time, protective equipment has increasingly been introduced onto the market with forged certificates. The certificates should therefore be reviewed with a view to establishing whether they are authentic and plausible.

If respiratory masks and other protective gear are duly delivered and free from defects, then the distributors are naturally entitled to have their invoices paid. There have recently been reports of payment delays. Given the often considerable sums of money at stake, distributors ought to take prompt action in asserting their rights.

Lawyers with experience in the field of commercial law can offer advice.

For more information:

https://www.mtrlegal.com/en/legal-advice/commercial-law.html

]]>
HandelsrechtPressemitteilungen