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 Sun, 22 May 2022 03:23:00 +0200 Sun, 22 May 2022 03:23:00 +0200 TYPO3 news-427 Fri, 29 Apr 2022 08:58:18 +0200 BFH: Capital gains attributable to home office remain tax-exempt https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-capital-gains-attributable-to-home-office-remain-tax-exempt.html The capital gains generated from the sale of an owner-occupied property that are attributable to a home office are tax-exempt. That was the verdict of the Bundesfinanzhof (BFH), Germany’s Federal Fiscal Court (case ref.: IX R 27/19).

We at the commercial law firm MTR Rechtsanwälte can report that in instances where a property which was used for personal residential purposes is sold, the capital gains do not usually have to be taxed. This is also true for the portion of the capitals gains attributable to a home office that was offset against income tax in previous years. That was the verdict of the Bundesfinanzhof in a ruling from March 1, 2021. The Court found that the use of a home office falls within the definition of personal residential use and that said home office is thus exempt from taxation.

This decision saw the BFH go against a letter from Germany’s Federal Ministry of Finance from October 2000, according to which a home office is not used for residential purposes.

The case before the BFH concerned a teacher who had sold a condominium that belonged to her and in which she had personally lived in for around five years. She had used one of the rooms as a home office and had claimed income-related expenses in connection with this, and these were recognized by the competent tax office. Although she had sold her condominium after five years, i.e., within the ten-year holding period, her profits from the sale were tax-exempt because she had personally made residential use of the property. And yet the tax office sought to withhold income tax on the proportion of the profits attributable to the study, pointing out that the sale had taken place within the ten-year speculation period.

This was successfully challenged by the woman in question, with both the Finanzgericht Baden-Württemberg – the Fiscal Court of Baden-Württemberg – at first instance and later the BFH ruling that the capitals gains on the study were also tax-exempt.

The BFH noted that while the sale of the property within the ten-year holding period constituted a private sales transaction, the profit is not taxed if the property was used exclusively for personal residential purposes, or if the property was used for personal residential purposes in the year it was sold and in the previous two years. The Court held that the use of a home office falls within the definition of personal residential use, as it too would be used regularly to a limited extent for personal residential purposes.

Those who find themselves caught up in a tax dispute with the authorities can turn to lawyers with experience in the field of tax law.

For more information:

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

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SteuerstreitPressemitteilungen
news-423 Tue, 19 Apr 2022 10:22:39 +0200 EGC: Not possible for the hissing sound from a beverage can to be registered as a trademark https://www.mtrlegal.com/en/news-and-press/detail/news/egc-not-possible-for-the-hissing-sound-from-a-beverage-can-to-be-registered-as-a-trademark-1.html The hissing sound that can be heard when opening a beverage can, followed by a pause and a fizzing sound, cannot be registered as a sound mark. That was the verdict of the General Court (EGC) – a constituent court of the Court of Justice of the European Union – in a ruling from July 7, 2021 (ref.: T-668/19).

While many consumers are no doubt familiar with the hissing sound one hears when opening a beverage can, followed by a brief moment of silence and then a fizzing sound, we at the commercial law firm MTR Rechtsanwälte can report that this sequence of sounds cannot be protected as a trademark. That was the verdict of the General Court, which concluded that there was a lack of distinctive character necessary for trademark registration.

A beverage producer had tried registering this sequence of sounds in audio file format as an EU sound trademark with the European Union Intellectual Property Office (EUIPO). Registration was sought for various different canned beverages, but the application was rejected by the EUIPO due to a lack of distinctive character required for registration as a trademark.

This decision was upheld by the General Court, which first sought to make it clear that the criteria for determining the distinctiveness of sound marks are no different from those that apply to other categories of marks. A sound mark thus needs to have a certain resonance by which consumers can recognize it as a trademark and not merely as a functional element without any intrinsic characteristics of its own. Consumers must be able to establish a link to the mark’s commercial origin from merely perceiving the mark without any connection to other elements, in particular words and images. The Court went on to clarify that in the present case, consumers would have to be able to identify from the hissing and fizzing sounds which manufacturer the canned beverage comes from. According to the EGC, the sound that is produced when a can is opened is to be viewed as a purely technical and functional element and is not an indication of the commercial origin. The Court concluded that there was a lack of sufficient distinctive character.

For a sign to be registered as a trademark, it must possess the necessary distinctive character. Lawyers with experience in the field of trademark law can advise on registering and protecting trademarks.

For more information:

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

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MarkenrechtPressemitteilungen
news-416 Wed, 30 Mar 2022 09:49:46 +0200 FG Münster: Amendment to tax assessment notice due to incorrectly attributed additional estimates https://www.mtrlegal.com/en/news-and-press/detail/news/fg-muenster-amendment-to-tax-assessment-notice-due-to-incorrectly-attributed-additional-estimates.html A tax assessment notice can be amended on account of estimates of additional income being attributed to the wrong tax assessment period. That was the verdict of the Finanzgericht (FG) Münster – the Fiscal Court of Münster – in a ruling from September 14, 2021 (ref.: 2 K 1155/19 G, F).

If a tax audit reveals income irregularities and it is suspected that the taxpayer provided incomplete information, the tax office can produce an estimate of additional profits. We at the commercial law firm MTR Rechtsanwälte note that while such an estimate must be realistic and not simply a stab in the dark, the ruling by the Finanzgericht Münster demonstrates that estimates of additional income being attributed to the wrong tax assessment period will not benefit the taxpayer.

In the instant case, a tax audit of a car dealer revealed unexplained cash deposits into the company account, and a subsequent cash transaction statement uncovered shortfalls. The tax authorities and the car dealer ultimately agreed on a total amount of 150,000 euros in estimated additional income, distributed evenly across the audit years 2008, 2009, and 2010, with the tax office subsequently issuing notices of assessment to effect this, including for trade tax.

The dealer lodged an objection against the assessment notices for 2009 and 2010, reasoning that the deficits identified for 2008 did not justify estimates of additional income for these years. This line of reasoning was followed by the tax office, which issued amendment notices to reflect this. What is now the definitive assessment notice for 2008 was amended by the tax office in accordance with Section 174(4) of the German Tax Code [Abgabenordnung, AO] in order to account for the total amount of 150,000 euros in estimated additional income for 2008.

The dealer’s legal action in opposition to this was ultimately unsuccessful. The FG Münster found that the prerequisites for the application of Section 174(4) AO had been met, i.e., in cases where a tax assessment notice has been amended to the benefit of the taxpayer due to an incorrect appraisal of a particular circumstance, the proper tax implications may subsequently be effected by issuing or amending a tax assessment notice. The Court noted that in this case the estimated additional income had been attributed to the wrong tax assessment period, as income generated in 2008 cannot be attributed to the following years. However, the total amount of estimated additional income had been correctly determined. The FG Münster held that the appeals against the tax assessment notices for 2009 and 2010 were only successful because the income had been attributed to the wrong tax assessment period and not because of the estimation method.

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

For more information:

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

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BetriebsprüfungPressemitteilungen
news-411 Mon, 14 Mar 2022 10:57:47 +0100 BGH: Protection of regional indications of source as collective marks https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-protection-of-regional-indications-of-source-as-collective-marks.html Regional indications of source for food items can, according to a ruling of the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – be protected under trademark law even if they do not conform to the EU criteria for geographical indications.

In a ruling from July 29, 2021, the Bundesgerichtshof held that regional indications of source can benefit from trademark protection under German law even if they do not meet the EU criteria for protected geographical indications (ref: I ZR 163/19 et al.). We at the commercial law firm MTR Rechtsanwälte note that in doing so the Court has strengthened the protection of collective marks at the national level.

The almost 1500-strong farmers’ cooperative that filed the lawsuit in question had registered its pork and beef products featuring a regional indication of source in their name. In order to be allowed to make use of the collective mark, it was not enough for the animals to come from the region. The members of the cooperative also had to adhere to strict quality standards with regards to how the animals were fed, kept, slaughtered, etc., and the cooperative filed these standards with the German Patent and Trademark Office.

Yet other businesses from the region were also using the same brand name for their products without being members of the cooperative and without adhering to the relevant standards. One such case, for instance, concerned a butcher’s shop. The farmers’ cooperative viewed this as an infringement of its trademark rights and therefore filed a lawsuit. Its first taste of success came in 2019 when the Oberlandesgericht (OLG) Stuttgart – the Higher Regional Court of Stuttgart – made it clear that unfairly exploiting the good reputation enjoyed by the collective mark was unacceptable and that consumers must be able to clearly recognize that they are not dealing with a product from the cooperative.

The BGH has since upheld the ruling and dismissed the appeal. The impact of this decision also extends to other collective marks. The Court held that a product can be protected as a German collective mark even if it is not eligible for protection according to the EU criteria. Accordingly, national protection of collective marks can exist parallel to or independent of European regulations.

Lawyers with experience in the field of trademark law can advise on a wide range of issues pertaining to trademark law: from registration and trademark protection, to asserting legal claims in response to infringements.

For more information:

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

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PressemitteilungenIP Recht
news-408 Mon, 28 Feb 2022 09:39:52 +0100 FG Münster: Loss of estate tax exemption in connection with sale of family home https://www.mtrlegal.com/en/news-and-press/detail/news/fg-muenster-loss-of-estate-tax-exemption-in-connection-with-sale-of-family-home.html A family home is no longer exempt from estate tax if the heir sells the house within ten years, even if the decision to move out was informed by the advice of a doctor.

We at the commercial law firm MTR Rechtsanwälte note that a family home can be inherited tax-free if certain conditions are met, it being necessary, among other things, for the heir to promptly begin personally making residential use of the property and to continue doing so for the next ten years. If the inherited family home is sold during this ten-year period, then it is no longer exempt from estate tax. According to a ruling of the Finanzgericht (FG) Münster – the Fiscal Court of Münster – from December 10, 2020, this is the case even if the heir has moved out on the advice of a doctor and sold the family home (case ref.: 3 K 420/20 Erb).

The plaintiff in the case in question inherited her deceased husband’s estate in 2017, including the 50 percent co-ownership share in the detached family house which the married couple had been living in at the time of the husband’s death. However, the plaintiff’s living situation changed when, in 2019, she sold the house and moved into a condominium instead. The competent tax office subsequently amended the estate tax assessment notice, with the result that the family home was deemed to have retroactively lost its tax-exempt status following the sale of the house within the ten-year time frame.

The plaintiff objected to this, noting that her husband had passed away in the family home and that she had been suffering from depression and anxiety in the wake of his death, which is why she made the decision to change her living environment on the advice of her doctor. According to the plaintiff, there were compelling reasons preventing her from making personal use of the family home.

The lawsuit was nonetheless rejected by the FG Münster. It held that the tax-exempt status of a family home which the heir stops personally making residential use of within ten years is only not lost if there is a compelling reason preventing the heir from making personal use of the property. This was found not to be the case here.

The FG Münster went on to note that while the plaintiff had indeed been under considerable psychological strain as result of her husband’s death and her depression, a compelling reason could only be said to exist if it was not possible for the heir to keep house, e.g., due to the need for care. The Court has granted leave to appeal to the Bundesgerichtshof (BGH), Germany’s Federal Supreme Court.

Heirs who inherit a family home need to make sure that the conditions for tax exemption are met. Lawyers with experience in the field of tax law can offer advice.

For more information:

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

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ErbschaftssteuerPressemitteilungen
news-405 Wed, 16 Feb 2022 10:24:28 +0100 FG Düsseldorf on the transfer of tax relief on estate tax https://www.mtrlegal.com/en/news-and-press/detail/news/fg-duesseldorf-on-the-transfer-of-tax-relief-on-estate-tax.html Tax relief on estate tax is not conditional on the distribution of the estate taking place within a defined timeframe. That was the verdict of the Finanzgericht (FG) Düsseldorf – the Fiscal Court of Düsseldorf – in a ruling from April 21, 2021 (case ref.: 4 K 1154/Erb).

In inheritance cases, spouses, children, or other close relatives may be able to benefit from tax relief on estate tax, with it being possible for estate tax relief to be passed on from heirs to third parties. We at the commercial law firm MTR Rechtsanwälte can report that according to a ruling of the FG Düsseldorf, it is not necessary for the distribution of the estate to take place within six months in order for the transfer of the tax relief to be effective.

The case in question concerned two brothers who in 2015 each inherited half of their parents’ estate, which included, among other things, multiple plots of land and a limited partnership interest. In 2018, the brothers reached an agreement for the purpose of partitioning the estate. This entailed one brother transferring his fifty percent ownership stake in an apartment and in the limited partnership interest to the other brother (later plaintiff). They resolved to divide the land between themselves. The plaintiff subsequently applied for an amendment to the estate tax assessment, claiming that he was now due the maximum estate tax relief on the family home and the business assets as opposed to merely 50 percent.

Unfortunately for him, the tax office did not go along with this line of reasoning. Its official response was that the distribution of the estate can only be taken into account for tax purposes if it takes place shortly after the accrual of the inheritance, i.e., within six months. It was noted that in the present case this did not occur until after three years had passed.

However, the FG Düsseldorf took a different view, ruling that the law does not impose a time limit on the distribution of the estate but that an inherent connection between the accrual of the inheritance and the allocation of the assets is required for the transfer of the tax relief, with it being necessary – particularly in cases involving complex investments – to clarify a number of issues. The FG Düsseldorf noted that while this does take time, the inherent connection is still there. The Court went on to state that in the instant case there were no indications that the transfer of the assets had occurred as a result of the heirs forming a new intention.

The ruling is not yet final; the appeal to the Bundesfinanzhof – Germany’s Federal Fiscal Court – is pending (case ref.: II R 12/21).

Lawyers with experience in the field of tax law can advise on matters pertaining to estate tax and gift tax.

For more information:

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

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ErbschaftssteuerPressemitteilungen
news-401 Wed, 02 Feb 2022 14:29:00 +0100 Forged certification of COVID-19 masks – Cancellation of purchase agreement https://www.mtrlegal.com/en/news-and-press/detail/news/forged-certification-of-covid-19-masks-cancellation-of-purchase-agreement.html A forged CE certificate entitles the buyer to cancel the agreement for the purchase of COVID-19 masks. That was the verdict of the Oberlandesgericht (OLG) Frankfurt – the Higher Regional Court of Frankfurt – in a ruling from September 15, 2021 (case ref.: 4 U 66/21).

At the outset of the coronavirus pandemic back in the spring of 2020, masks and other protective equipment were in short supply in Germany. One consequence of these supply shortages was that some merchants began marketing masks and other equipment of inferior equality that did not meet current protection standards or whose certificates were forged. We at the commercial law firm MTR Rechtsanwälte note that it is customers and distributors who have suffered as a result. According to the judgment of the OLG Frankfurt, they are entitled to demand the cancellation of the purchase agreement if CE certification has been forged.

In the case in question, the plaintiff had ordered 80,000 disposable COVID-19 masks, with the seller having warranted that the masks were CE certified. The latter demanded that the purchase price be paid in cash on delivery. The plaintiff complied with this demand, and there was a reference to CE certification on the packaging of the masks delivered. However, this certification notice was missing from the subsequently delivered invoice. The plaintiff therefore requested that they be sent proof of certification. While they did receive a certificate to this end, this turned out to be a forgery from a Polish company. In fact, the masks had not been CE certified.

Accordingly, the plaintiff demanded that the purchase price be repaid for return of the masks. The claim was successful before the OLG Frankfurt, which upheld the ruling at first instance and dismissed the mask supplier’s appeal, noting that the masks were not certified as promised and thus defective.

The Court held that the plaintiff was not required to comply with a deadline for supplementary performance due to unreasonableness, an appropriate descriptor given that the defendant had supplied the plaintiff with a forged certificate following the conclusion of the purchase agreement, resulting in a breakdown in trust.

The ruling is not yet final. Leave to appeal can still be pursued by means of an appeal against the denial of leave to appeal.

Merchants who have been supplied with defective masks or other defective protective equipment over the course of the coronavirus pandemic ought to assert their rights and reclaim their money. Lawyers with experience in the field of commercial law can provide counsel.

For more information:

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

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HandelsrechtPressemitteilungen
news-397 Wed, 12 Jan 2022 14:56:07 +0100 Munich court throws its weight behind protected designations of origin in Champagne dispute https://www.mtrlegal.com/en/news-and-press/detail/news/munich-court-throws-its-weight-behind-protected-designations-of-origin-in-champagne-dispute.html Food products that feature Champagne in their name should actually taste like Champagne. That was the verdict of the Oberlandesgericht (OLG) München – the Higher Regional Court of Munich – in a judgment from July 1, 2021 (case ref.: 29 U 1698/14).

Champagne, a drink often served on festive occasions, is not merely a sparkling drink but also a protected designation of origin that cannot be exploited without proper cause. Reason enough for the Association of French Champagne Producers to crack open a bottle and celebrate, particularly in light of the recent ruling delivered by the OLG München.

After years of legal wrangling, we at the commercial law firm MTR Rechtsanwälte can now report that the Munich court has affirmed the importance of the protections enjoyed by designations of origin. The case concerned a dispute between Champagne producers and a discounter that had been stocking a product labelled as a “Champagne sorbet”. The Association of Champagne Producers took legal action against this, arguing that it violated the protected designation of origin “Champagne”.

The case even reached the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – and the European Court of Justice (ECJ). In a ruling from December 20, 2017, the ECJ held that use of the term Champagne is only legal if the relevant product’s taste can be attributed primarily to Champagne, otherwise its use constitutes unlawful exploitation of the reputation of a protected designation of origin for the purposes of unjustifiably benefiting from said reputation.

And this was exactly what the sorbet in question was found to be lacking despite consisting of roughly 12% Champagne. According to one expert assessment, the sorbet’s dominant flavor was that of pears. For this reason, the OLG München deemed the product’s description as a Champagne sorbet to be misleading to consumers, reasoning that it amounted to unlawful exploitation of the designation of origin “Champagne”. The Court noted that the discounter had benefited greatly from the positive public image of the protected designation of origin and refused leave to appeal on the grounds that both the BGH and the ECJ had already addressed the case.

The ruling is likely to send a signal and strengthen the protection of designations of origin, which – like trademarks – represent major assets due to, among other reasons, consumers associating a certain level of quality with the product. Other businesses are not allowed to take undue advantage of this aura of prestige and in so doing mislead consumers.

Lawyers with experience in the field of trademark law can provide counsel.

For more information:

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

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PressemitteilungenIP Recht
news-393 Thu, 06 Jan 2022 10:24:22 +0100 BGH: Golden color of chocolate bunny enjoys trademark protection https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-golden-color-of-chocolate-bunny-enjoys-trademark-protection.html The Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – ruled on July 29, 2021 that the shade of gold used by a particular manufacturer for its chocolate bunnies enjoys trademark protection (case no.: I ZR 139/20).

The manufacturer’s chocolate bunny wrapped in golden foil has been a staple on supermarket shelves in the weeks leading up to Easter for decades and is well recognized by consumers. A survey conducted by the manufacturer found that 70 percent of respondents associate the golden color of the foil with the company. We at the commercial law firm MTR Rechtsanwälte can report that the BGH has since ruled that this particular shade of color enjoys trademark protection due to how readily consumers associate it with the manufacturer in question. In doing so, the BGH overturned a ruling of the Oberlandesgericht (OLG) München, the Higher Regional Court of Munich.

Since the golden chocolate bunny has been sold since the beginning of the 1950s, the manufacturer believes that it is the owner of a trademark acquired through use of this particular shade of golden color, which is why it considered its trademark rights to have been infringed when it came across a competitor marketing its own golden chocolate bunny in 2018.

The manufacturer’s lawsuit was nonetheless ultimately dismissed by the Higher Regional Court of Munich, which held that the long-standing use of this particular shade of color had yet to give rise to any rights under trademark law. According to the Court, the color had not acquired a reputation for being associated with the chocolate bunnies and hence the plaintiff was not the owner of a trademark acquired through use pursuant to Section 4 No. 2 of the German Trademark Act [Markengesetz, MarkenG] (case no.: 29 U 6389/19).

However, having concluded that the plaintiff had in fact successfully made the case that the golden color of the chocolate bunny had acquired market recognition, the BGH took a different view and granted the plaintiff's appeal, noting that according to the survey presented in court the degree of association was 70 percent, substantially higher than the required 50 percent.

The Court went on to state that the color trademark need not necessarily have been used for all or many of the company's products as a kind of "house color" in order for it to acquire a reputation. Other design features were also found not to preclude the color having acquired a reputation; what is important according to the BGH is that the target consumer audience see an indication of origin in the use of this particular shade of gold for chocolate bunnies even if it is featured together with these other design elements.

Whether the competitor in question has infringed the manufacturer’s trademark rights with its chocolate bunny in golden foil must now be adjudicated by the Higher Regional Court of Munich.

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

For more information:

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

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PressemitteilungenMarkenrecht
news-388 Wed, 29 Dec 2021 11:53:35 +0100 End to the suspension of the duty to file for insolvency https://www.mtrlegal.com/en/news-and-press/detail/news/end-to-the-suspension-of-the-duty-to-file-for-insolvency.html With the suspension of the duty to file for insolvency having been lifted in late April, businesses facing imminent insolvency are once again required to file for insolvency as soon as possible.

The duty to file for insolvency was suspended in March of 2020 to prevent a wave of insolvencies in the wake of the coronavirus pandemic. This suspension was later extended a number of times – subject to restrictions – until April 30, 2021, with the coalition partners unable to reach an agreement on a further extension. This means that the special arrangements relating to insolvency protection, which most recently only applied to over-indebted companies, have expired.

The standard provisions of insolvency law have thus been in force again since May of 2021. We at the commercial law firm MTR Rechtsanwälte note that this means managing directors or board members are required to file for insolvency as soon as possible but with a delay of no more than three weeks when faced with the prospect of imminent insolvency.

Insolvency describes a situation in which a company is unable to pay its debts and/or is over-indebted. The former is deemed to have occurred if the company is no longer able to pay wages, or its bills, or make payments on loans, whereas the company is assumed to be over-indebted if its debts exceed the entire value of the company.

If there is reason to believe a company is insolvent, it is necessary to file for insolvency as soon as possible and without undue delay, i.e. no more than three weeks delay. However, this period can only be taken advantage of if there is legitimate cause to believe that the grounds for insolvency can be successfully addressed within this three-week timescale. These grounds may have persisted for longer than three weeks because of the coronavirus pandemic, and businesses ought to have been aware that it was only by virtue of the special arrangements put in place by the German government that it was not necessary to file for insolvency within the usual timeframe.

Failure to file for insolvency in due time may render those responsible liable to prosecution for late filing of insolvency. It should also be noted that no further payments may be made following the onset of insolvency. This is another way in which the managing directors or board members responsible can find themselves guilty of an offence.

Filing for insolvency presents businesses with an opportunity to restructure and to start again on sound economic footing. For this reason, it ought to be assessed whether the insolvency process can be administered autonomously.

Lawyers with experience in the field of insolvency law can provide counsel.

For more information:

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

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PressemitteilungenRestrukturierung InsolvenzCorona und Insolvenzrecht
news-385 Mon, 27 Dec 2021 17:58:09 +0100 OLG Karlsruhe rules on business closure insurance provider’s liability for closures related to COVID-19 https://www.mtrlegal.com/en/news-and-press/detail/news/olg-karlsruhe-rules-on-business-closure-insurance-providers-liability-for-closures-related-to-covid.html In a ruling of June 30, 2021, the Oberlandesgericht (OLG) Karlsruhe – the Higher Regional Court of Karlsruhe – found a provider of business closure insurance liable to pay out in response to a closure related to COVID-19 (ref.: 12 U 4/21).

In order to stem the spread of the coronavirus, restaurants and hotels have at times been forced to close by the authorities. Whether the provider of business closure insurance is liable to pay out in these cases is a matter of dispute. We at the commercial law firm MTR Rechtsanwälte can report that while the regional courts of Munich and Düsseldorf have answered in the affirmative, the OLG Karlsruhe has stated that it essentially comes down to the wording of the insurance conditions.

In a case that came before the OLG Karlsruhe (ref.: 12 U 4/21), a hotel with an associated restaurant had been forced to close temporarily due to the pandemic. The terms and conditions of the business closure insurance policy that was taken out in January 2020 made multiple references to the German Act concerning the Prevention and Control of Infectious Diseases (Infektionsschutzgesetz, IfSG), according to which insurance cover is to be provided in the event of an outbreak of notifiable diseases or pathogens if these are listed by name in the Act. Since COVID-19/SARS-CoV-2 was not listed, the insurer did not wish to pay out.

However, the OLG Karlsruhe did not play along, ruling that the attempt to limit the insurance coverage to an exhaustive catalog of diseases and pathogens that falls short of the scope of the IfSG was not sufficiently clear and understandable. The clause was found to be in violation of the statutory requirement for transparency and was therefore invalid. The repeated references to the IfSG in the insurance terms and conditions were said to have given the policyholder the impression that any business closure justified on the basis of the IfSG was covered by the insurance, and yet the fact that there were restrictions was not made clear enough. Having found the clause to be invalid, the OLG Karlsruhe concluded that COVID-19/SARS-CoV-2 was also covered by the insurance.

In another case, however, the OLG Karlsruhe arrived at a different conclusion (ref.: 12 U 11/21). There was no mention in that case of the IfSG anywhere in the insurance conditions of the business closure insurance policy that had been taken out in 2019. Instead, the insurance conditions included a provision expressly stating that notifiable diseases and pathogens within the meaning of the contract in question were "only" those listed in a subsequent catalog, with COVID-19/SARS-CoV-2 not being listed. The Court held that the clause in this case was unambiguous and that the policyholder was not unreasonably disadvantaged.

Whether a provider of business closure insurance is liable to pay out depends on the circumstances of a given case. Experienced attorneys can provide counsel in the context of legal disputes with the insurer.

For more information:

https://www.mtrlegal.com/rechtsberatung/corona.html

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CoronaPressemitteilungen
news-383 Mon, 13 Dec 2021 09:44:03 +0100 COVID-19 – Liability of business closure insurance providers depends on the individual case https://www.mtrlegal.com/en/news-and-press/detail/news/covid-19-liability-of-business-closure-insurance-providers-depends-on-the-individual-case.html Whether a provider of business closure insurance is liable to pay out in response to a closure related to COVID-19 depends largely on the specific wording of the insurance conditions.

A large of number of stores were forced to close during the coronavirus lockdown. Although it remains a matter of legal dispute whether a provider of business closure insurance is required to pay out if a business is forced to close by the authorities, we at the commercial law firm MTR Rechtsanwälte can report that it is becoming increasingly apparent that the issue of liability turns on the specific wording in the insurance conditions.

In its ruling of June 30, 2021, the Oberlandesgericht (OLG) Karlsruhe – the Higher Regional Court of Karlsruhe – found an insurer liable to pay out (ref.: 12 U 4/21). In the case in question, the operator of a hotel with an associated restaurant had taken out business closure insurance in January 2020. The terms and conditions of the insurance policy stated that insurance cover was provided in the event of an outbreak of notifiable diseases or pathogens if these were listed in the German Act concerning the Prevention and Control of Infectious Diseases (Infektionsschutzgesetz, IfSG). At that time, this was not yet the case for COVID-19/SARS-CoV-2, and the insurer did not want to provide coverage.

However, the OLG Karlsruhe did not play along, noting that the insurance conditions repeatedly made reference to the IfSG. This was said to give the policyholder the impression that every business closure justified on the basis of the IfSG would be covered by the insurance, it not being clear to them that there are restrictions. A clause which limits insurance coverage to an exhaustive catalog of diseases and pathogens that falls short of the scope of the IfSG is not transparent for the policyholder and is therefore invalid according to the OLG Karlsruhe. The Court held that the policyholder did not realize that the catalog in the insurance conditions was already out of date. In addition, it noted that an obligation to report COVID-19 was already in place at the time when the policy was taken out.

The Oberlandesgericht (OLG) Celle – the Higher Regional Court of Celle – arrived at a different conclusion in its judgment of July 1, 2021 (ref.: 8 U 5/21). The case was concerned with a restaurateur who had been forced to close his restaurant due to the coronavirus. In the terms and conditions of his business closure insurance, the obligation to pay out was tied to the outbreak of diseases and pathogens named in the IfSG. At that time, COVID-19 was still unknown and not named. Finding that the list of diseases and pathogens in the insurance conditions was exhaustive, the OLG Celle ruled that the insurer was not liable to pay out and that the policyholder was not unreasonably disadvantaged as a result.

The Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – will probably have the last word on the liability of business closure insurance providers. The OLG Celle has granted leave to appeal to the BGH.

For more information

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

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CoronaPressemitteilungen
news-378 Fri, 08 Oct 2021 15:27:38 +0200 ECJ: Toy block eligible for design protection https://www.mtrlegal.com/en/news-and-press/detail/news/ecj-toy-block-eligible-for-design-protection.html A well-known toy building block shall continue to enjoy protection. That was the verdict of the European Court of Justice (ECJ) in a ruling from March 24, 2021 that overturned a decision of the European Union Intellectual Property Office (EUIPO) (A.: T-515/19).

Design protection can be requested in the European Union for the appearance of the whole or a part of a product resulting from the features, in particular the lines, contours, colors, shape, texture and/or materials of the product itself and/or its ornamentation. We at the commercial law firm MTR Rechtsanwälte note that design protection is a top priority for businesses because of how well recognized designs are by consumers.

It is for this reason that a well-known manufacturer of toy building blocks requested design protection for a building block. The registration of the design was subsequently declared invalid by the EUIPO in 2019 in response to a legal action brought by another company.

In its reasoning, the EUIPO stated that all features of the appearance of the product benefiting from design protection were solely dictated by its technical function, specifically its assembly with other blocks. The EUIPO noted that solely technical functions are not eligible for protection as Community designs.

The manufacturer of the building blocks took action against this and was successful before the ECJ. This was somewhat surprising given that back in 2010 the ECJ had ruled in a trademark dispute that the toy block was not eligible for trademark protection based solely on its shape, it being necessary to achieve a technical result.

The ECJ has now delivered a different verdict with respect to design protection in the present case, even though it too is essentially concerned with technical function. In justifying this decision, the European Court stated that the EUIPO had erred in law by failing to consider the possibility of an exception, namely that mechanical fittings of modular products may exceptionally constitute an important element of the innovative characteristics of modular products and represent a major marketing asset, and therefore ought to be eligible for protection. The ECJ went on to state that the design can benefit from protection if it serves the purpose of allowing the multiple assembly or connection of products within a modular system. The EUIPO must now reconsider the matter.

Lawyers with experience in the field of trademark law can provide counsel.

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

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MarkenrechtPressemitteilungen
news-371 Thu, 09 Sep 2021 14:04:28 +0200 BGH approves clauses that provide for lump-sum compensation in response to cartel damages https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-approves-clauses-that-provide-for-lump-sum-compensation-in-response-to-cartel-damages.html In a judgment from February 10, 2021, the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – found a clause providing for lump-sum compensation in response to damages claims lodged on the basis of unlawful cartel arrangements to be lawful (Az.: KZR 63/18).

The case concerned claims for damages that had been asserted against one of the members of the so-called “Schienenkartell” (rail cartel) that was exposed back in 2011. The cartel members had been colluding to fix, among other things, prices and quotas for railroad tracks. One transportation company had entered into an additional contractual agreement with one of the members of the cartel, according to which the former was entitled to claim lump-sum compensation in the event of a breach of antitrust law.

Lump-sum cartel compensation clauses of this kind are legally contentious. The BGH has now ruled that these clauses are legitimate and that they do not unduly disadvantage parties on the receiving end of such claims. We at the commercial law firm MTR Rechtsanwälte note that the decision is likely to prove positive for the victims of cartels above and beyond the rail cartel.

Lump-sum compensation clauses are regularly incorporated because of how difficult and tedious calculating cartel damages often proves to be. Cartel members frequently consider these clauses to be invalid, arguing that they are in breach of the laws governing general terms and conditions.

The Bundesgerichtshof’s cartel panel has since put an end to this line of reasoning, while also noting that there are several rules that need to be observed when it comes to compensation for cartel damages. The court held that quantifying damage that is the result of an antitrust infringement is often associated with considerable difficulties and a great deal of material and financial effort. Lump-sum compensation clauses are therefore key to making the enforcement of damages claims more efficient. According to the BGH, if a product was purchased at an inflated price due to illegal price fixing, compensation can be awarded as a lump sum by means of a clause to this end in the purchase agreement or contract for work and services in the amount of up to 15 percent of the total billing amount. The court went on to state that it is possible to make arrangements for a lump sum that corresponds to the average price markup resulting from cartels. The transport company in question had only agreed a lump sum of 5 percent.

Only if the lump sum is significantly higher than the damage caused by the cartel arrangements is the clause invalid according to the Bundesgerichtshof. This has yet to be determined by the appeal court in the instant case. Accordingly, the BGH referred the matter back to the Oberlandesgericht that had previously heard the case. The BGH noted, however, that the cartel member must demonstrate that the lump sum is in fact higher than the actual damage.

The ruling is equally groundbreaking for other damages claims lodged on the basis of unlawful cartel arrangements. Lawyers with experience in the field of antitrust law can provide counsel.

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Pressemitteilungen
news-368 Mon, 23 Aug 2021 10:58:28 +0200 BFH: Tax consultancy costs and clearance costs can be deducted from tax as estate planning costs https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-tax-consultancy-costs-and-clearance-costs-can-be-deducted-from-tax-as-estate-planning-costs.html If a testator has committed tax evasion, the costs incurred from obtaining tax advice in relation to the supplementary tax return can be deducted from tax as estate planning costs according to a ruling of the Bundesfinanzhof (BFH), Germany’s Federal Fiscal Court (Az.: II R 30/19).

Heirs, take note: A supplementary tax return needs to be submitted by the heirs if the estate contains undeclared assets. If the heirs conceal these from the tax authorities, they may themselves be guilty of tax evasion. We at the commercial law firm MTR Rechtsanwälte note that those heirs that have yet to declare unreported income to the tax authorities should look into the possibility of submitting a voluntary declaration.

If an estate contains undeclared assets, the heirs ought to consult with experts and submit a supplementary declaration to the tax authorities. The benefit of doing so is that the costs incurred from obtaining advice in relation to the supplementary declaration can be deducted from estate tax as estate planning costs. The costs associated with the dissolution of the household and clearing the testator’s property are also tax deductible. That was the verdict of the Bundesfinanzhof in a ruling from October 14, 2020.

The testator in the case in question had generated income in Switzerland but failed to declare this in his tax returns from 2002 to 2012. The daughter, in her capacity as heir, had her deceased father’s tax returns corrected. She subsequently declared the resulting costs, together with the costs associated with clearing her father’s property, in her estate tax declaration as a liability of the estate.

The tax office did not approve of this, refusing to take the costs incurred from obtaining tax advice and clearing the property into account when determining the amount of estate tax due.

The daughter’s subsequent lawsuit was only partially successful before the relevant fiscal court, which held that the tax consultancy costs were to be accounted for as estate planning costs because the obligation to file tax returns had passed to the heir. However, the court took a different view when it came to the costs associated with clearing the property, ruling these were not tax deductible.

The Bundesfinanzhof went one step further. Ruling in favor of the heir, the court found that the clearance costs could be deducted from tax as estate planning costs. It reasoned that inspecting the household and clearing the property are directly linked to the estate.

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

For more information:

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

 

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PressemitteilungenErbschaftssteuer
news-366 Tue, 10 Aug 2021 15:58:01 +0200 BGH: Advertisements that feature test verdicts without referencing the source are unlawful https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-advertisements-that-feature-test-verdicts-without-referencing-the-source-are-unlawful.html Advertisements that feature test verdicts must include a reference to the source that is clearly visible to consumers. That was the verdict of the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – in a ruling from April 25, 2021 (Az.: I ZR 134/29).

Products that perform well in tests conducted by prestigious institutions can draw on these accolades as a source of positive publicity. We at the commercial law firm MTR Rechtsanwälte note, however, that advertisements that feature a test verdict must also specify where consumers can look up the test results for themselves. Failure to do so constitutes a violation of competition law according to the BGH.

The case in question concerned a DIY chain that had been promoting a manufacturer’s paint in a catalogue, with the image of the paint bucket featuring alongside a small test verdict and recognition of the product as a “Testsieger”, i.e. the best performing product in a test.

A competition association filed a lawsuit in response to this, arguing that the advertisement was anticompetitive. While acknowledging that the catalogue featured the test verdict alongside the relevant image in the catalogue, it also noted that there was no visible reference to the source of the test.

The First Civil Chamber of the BGH granted the action. The judges found the advertising to be in breach of the German Unfair Competition Act (Gesetz gegen den unlauteren Wettbewerb, UWG), and the plaintiff was therefore entitled to seek injunctive relief. The court went on to note that the distinction of being the best rated product in the test – featured clearly alongside the relevant image in the catalogue – had a positive promotional effect, and that the DIY chain had made use of this test verdict for its own promotional purposes and was required to provide a reference to the source of the test results. The court held that due to the exceptional promotional impact of a test verdict, it is necessary to include a reference to the source even if, as in this case, the distinction of being the best rated product in the test is only objectively being promoted without being particularly emphasized.

The BGH clarified that referencing a website featuring the source is not superfluous, as it can be easily looked up. Consumers need to be able to access the source without any intermediate steps.

The court noted that consumers’ interest in being able to investigate test-based promotions when making an informed business decision and to be able to make sense of them in the overall context of the test is not contingent on the intensity with which the test results are promoted.

There is often a fine line to be walked when it comes to advertising, with the prospect of penalties in the form of formal warnings, injunction suits, and damages claims never far away. Lawyers with experience in the field of antitrust and competition law can provide counsel.

For more information:

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

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WettbewerbsrechtPressemitteilungen
news-363 Thu, 29 Jul 2021 09:00:52 +0200 Turkey shares financial data – Tax dodgers should consider submitting a voluntary declaration https://www.mtrlegal.com/en/news-and-press/detail/news/turkey-shares-financial-data-tax-dodgers-should-consider-submitting-a-voluntary-declaration.html The automatic exchange of financial information is supposed to assist countries in their efforts to tackle cross-border tax evasion. Turkey is now among the countries that share information with the German tax authorities.

The automatic exchange of information is a powerful weapon in the fight against cross-border tax evasion. More than 100 countries are party to the international agreement, which sees the signatory states mutually exchange financial information relating to their taxpayers who have accounts abroad. Among the signatories are former tax havens such as Switzerland. Following quite a bit of back and forth, Turkey is now also among the countries that share information with the German tax authorities. This means that untaxed income in Turkish accounts will no longer be hidden from the German authorities.

Anyone who is liable to pay taxes in Germany and fails to declare income from foreign accounts, for example in Turkey, is committing tax evasion. We at the commercial law firm MTR Rechtsanwälte note, however, that it remains possible to submit a voluntary declaration for tax evasion, which can potentially lead to immunity from punishment.

The first transferal by Turkey of financial information pertaining to individuals living in Germany with one or more accounts in Turkey was supposed to have already taken place in late 2020. Following delays, information was set to flow freely as of June 1, 2021, with President Erdogan signing a decree to this end.

In addition to names, addresses, birth dates, account numbers, and tax identification numbers, other information shared as part of the automatic exchange of information includes account balances and income from returns on capital. As a result, untaxed income from capital in foreign accounts can no longer be concealed from the tax authorities. One possible solution is to submit a voluntary declaration for tax evasion, with this potentially leading to immunity.

That being said, the declaration needs to be complete and have been submitted on time, i.e. before the tax evasion is discovered by the authorities. That is why those concerned should not wait much longer if they want to submit a voluntary declaration. For the declaration to be complete it needs to include all tax-relevant information from the past ten years. Even minor errors can render a voluntary declaration incapable of leading to immunity, though it may still have a mitigating effect similar to a confession.

Lawyers with experience in the field of tax law know what information needs to be included in the voluntary declaration and can prepare the latter in a manner that ensures that it will be effective.

For more information:

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

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SelbstanzeigePressemitteilungen
news-360 Mon, 26 Jul 2021 09:44:36 +0200 Voluntary disclosure: Germany’s Federal Minister of Finance purchases tax CD from Dubai https://www.mtrlegal.com/en/news-and-press/detail/news/voluntary-disclosure-germanys-federal-minister-of-finance-purchases-tax-cd-from-dubai.html Germany’s Federal Minister of Finance, Olaf Scholz, has purchased a CD from Dubai that contains confidential information pertaining to possible tax evaders. A number of taxpayers – including quite a few from Germany – ought to be concerned that their tax evasion will be discovered.

There has been little to report on recently regarding the purchase of so-called “Steuer-CDs” (tax CDs). That is until now: Germany’s Federal Minister of Finance (“Bundesfinanzminister”) has directed the Bundeszentralamt für Steuern – Germany’s Federal Central Tax Office – to purchase confidential data for the first time. The Bundesfinanzminister is seeking to step up the fight against tax fraud, with Germany’s federal states now set to examine the data from Dubai and uncover potential tax offenses, including tax evasion by taxpayers from Germany.

Tax fraud has long since ceased being treated as a trivial offense. Today, it is met with severe penalties. We at the commercial law firm MTR Rechtsanwälte note, however, that those concerned are still able to submit a voluntary declaration that can potentially lead to immunity from punishment.

The CD that was purchased from Dubai is reported to contain extensive information concerning assets in the Emirates belonging to millions of taxpayers, including assets belonging to thousands of Germans who own properties in the Gulf state and who may have concealed this from the German tax authorities. The matter will now be looked at in great detail by tax investigators. If their investigations bear fruit, the individuals concerned may be facing severe penalties ranging from fines all the way to custodial sentences.

One possible way forward is to submit a voluntary declaration, but this can only lead to immunity if the declaration is complete and submitted on time, i.e. before the tax evasion is discovered. The individuals concerned should therefore take action at once. Even if the tax evasion is considered to have already been uncovered, the declaration can still have a mitigating effect – much like a confession – and potentially be the difference between prison and a fine.

A voluntary declaration must include any and all information that is relevant from a tax perspective. A voluntary declaration that is incomplete or which contains inaccurate information cannot lead to immunity.

To avoid these kinds of mistakes and ensure that the voluntary declaration is effective, it is vital to consult with lawyers who are experienced in the field of tax law. They work in close consultation with clients and can be trusted to handle your case with discretion. They know what information needs to be included in the voluntary declaration and can prepare the latter in a manner that ensures that it will satisfy the requirements set out by the legislature.

For more information:

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

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SelbstanzeigePressemitteilungen
news-359 Tue, 20 Jul 2021 10:51:00 +0200 BFH finds rules governing taxation of shares to be partially unconstitutional https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-finds-rules-governing-taxation-of-shares-to-be-partially-unconstitutional.html Losses from shares can only be offset against profits from the sale of shares. The Bundesfinanzhof (BFH) – Germany’s Federal Fiscal Court – has ruled that this is unconstitutional and asked the Bundesverfassungsgericht – Germany’s Federal Constitutional Court – to weigh in (Az.: VIII R 11/18).

The fact that losses from share trading can, to date, only be offset against profits from the sale of shares is a source of frustration for shareholders, it not being possible to offset the losses against income from capital assets. We at the commercial law firm MTR Rechtsanwälte note, however, that shareholders may find hope in a recent ruling of the Bundesfinanzhof that points to the possibility of change.

In a judgment from November 17, 2020, the BFH made it clear that it considers this aspect of the taxation of shares unconstitutional, and it consequently brought the case in question to the attention of the Bundesverfassungsgericht.

The backdrop to this case is the German Corporate Tax Reform Act of 2008 (Unternehmenssteuerreformgesetz), which set out a fundamentally new framework for the taxation of capital investments held as private assets for tax purposes. The Act provides for, among other things, an additional restriction on the ability to offset losses from the sale of shares: these cannot be offset against income from capital assets; only profits from the sale of shares can be used to offset the losses.

The case before the BFH concerned a married couple whose unfortunate record dealing with shares had resulted in the couple incurring losses of around 4,800 euros from the sale of shares. They subsequently sought to offset these losses against income (of just under 3,400 euros) from other investments. Yet neither the competent tax office nor the Finanzgericht Schleswig-Holstein – the Fiscal Court of Schleswig-Holstein – at first instance was supportive of this course of action.

However, the Bundesfinanzhof reached a different conclusion on appeal, ruling that the restriction on the ability to offset losses from shares amounts to an unconstitutional violation of the principle of equality. As such, the court held that taxpayers’ losses from the sale of shares are being treated differently for tax purposes than losses from the divestiture of other investments. Moreover, the BFH found that there is no justification for this discrimination.

Many investors may stand to benefit if the Bundesverfassungsgericht affirms the position taken by the BFH. They would subsequently be able to offset losses from the sale of shares against other income from capital assets, e.g. from investments in funds or from interest.

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

For more information:

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

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PressemitteilungenSteuerstreit
news-348 Fri, 28 May 2021 10:41:18 +0200 BGH changes tune on trademark forfeiture https://www.mtrlegal.com/en/news-and-press/detail/news/bgh-changes-tune-on-trademark-forfeiture.html In a judgment from January 14, 2021, the Bundesgerichtshof (BGH) – Germany’s Federal Supreme Court – overruled its own legal precedent on the forfeiture of trademarks (Az.: I ZR 40/20) in finding that failure to make use of a trademark means forfeiting trademark protection.

According to Section 49 of the German Trademark Act (Markengesetz, MarkenG), the registration of a trademark will be declared invalid and cancelled in response to a request to this end if the mark has not been used over a continuous period of five years. We at the commercial law firm MTR Rechtsanwälte can report that the BGH recently ruled that for the purposes of a legal action to have a trademark declared invalid, the determining factor is the date on which formal notice of the action was served. The court held that the duty of disclosure and burden of proof regarding the forfeiture of a trademark lie not with the plaintiff; rather, it is the proprietor of the trademark who must prove genuine use of the mark. This marks a departure from the Bundesgerichtshof’s case-law to date, which was no longer consistent with EU law.

The case concerned a trademark that had been registered by a wine merchant for sparkling wines. A competitor submitted a request to the German Patent and Trademark Office to have the mark cancelled on the basis that it was not being used. The action was dismissed by the Landgericht (LG) München, the Regional Court of Munich. The appeal before the Oberlandesgericht (OLG) München – the Higher Regional Court of Munich – was also unsuccessful, the OLG having considered the preconditions for declaring a trademark invalid not to have been met. The plaintiff was said to have failed to prove that the mark was not being used, with the trademark proprietor bearing merely a secondary duty of disclosure that it had successfully discharged.

However, the BGH took a different view on the matter, referring the proceedings back to the OLG München. The issue of whether the trademark had not been used for five years was said to be informed by the date on which legal action was taken, i.e. the date formal notice of the action was served. In a departure from its previous rulings, the BGH held that the period following the filing of the action until the conclusion of the oral hearing is no longer relevant. The court went on to state that if the action is preceded by a request submitted to the German Patent and Trademark Office to have the mark cancelled, the date on which the request was received is decisive provided the action for cancellation is brought within three months of the party submitting the request having been informed of the trademark proprietor’s objection.

The BGH concluded that the duty of disclosure and burden of proof lie not with the plaintiff but with the proprietor of the trademark when it comes to the use or non-use of a mark.

Lawyers with experience in the field of trademark law can provide counsel.

For more information:

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

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MarkenrechtPressemitteilungen
news-347 Fri, 28 May 2021 10:37:02 +0200 Bundeskartellamt issues fines in response to illegal price fixing https://www.mtrlegal.com/en/news-and-press/detail/news/bundeskartellamt-issues-fines-in-response-to-illegal-price-fixing.html The Bundeskartellamt – Germany’s Federal Cartel Office – has imposed fines totaling around 6 million euros on two foundries for entering into anticompetitive agreements regarding prices and discounts.

The foundries in question manufacture manhole covers and other casting products for street sewers. In addition to colluding on prices and discounts, they also agreed to divide up two large contracts between them. We at the commercial law firm MTR Rechtsanwälte note that these kinds of arrangements are of course illegal and in breach of antitrust law, which is why the Bundeskartellamt has ordered both companies to pay up.

The Federal Cartel Office has revealed that those responsible at each of the companies had been illegally fixing prices to the detriment of their customers. They were said to have entered into – and later implemented – arrangements in 2018 for multiple increases to net prices and for reductions to discounts for certain product groups, both over the phone and during a personal meeting. The Bundeskartellamt also reported that the companies agreed to divide up two large contracts between them.

The unlawful arrangements were uncovered thanks to an anonymous whistleblower. The Bundeskartellamt subsequently launched investigations, the conclusion of which was that the two companies had been coordinating prices and discounts at least between the months of May and November of 2018 and had coordinated and adjusted conditions on a number of occasions during this period. This is also when they colluded to divide up the two large contracts between them.

Both companies cooperated fully with the Federal Cartel Office during the investigations, and this was taken into account when calculating the fines. The proceedings came to an amicable end and the fines already have the force of law.

Through their unlawful arrangements, the two foundries were found to have had an adverse effect on fair competition and to have violated antitrust law. Anyone who has incurred losses as a consequence of this can assert claims for damages.

It is by no means necessary for violations of antitrust law to be as blatant as in the case of illegal agreements concerned with prices or discounts. Indeed, it is common for even individual clauses in contracts to give rise to a violation of competition or antitrust law, with the companies involved and individuals responsible potentially facing heavy penalties as a result.

Lawyers with experience in the field of antitrust and competition law can provide counsel.

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Pressemitteilungen
news-345 Thu, 27 May 2021 09:03:49 +0200 KG Berlin: Commercial rent reduction in response to closures related to COVID-19 https://www.mtrlegal.com/en/news-and-press/detail/news/kg-berlin-commercial-rent-reduction-in-response-to-closures-related-to-covid-19.html In a judgment from April 1, 2021, the Kammergericht (KG) Berlin – the Berlin Court of Appeal – ruled that commercial rent can be lowered by 50 percent in response to a closure related to COVID-19 (Az.: 8 U 1099/20).

Businesses have been forced to either partially or completely close their doors in order to curb the spread of the coronavirus. We at the commercial law firm MTR Rechtsanwälte can report that Germany’s federal government made it clear through new regulations in December of 2020 that the government-imposed lockdown may constitute an interference with the basis of a contract within the meaning of Section 313 of the German Civil Code (Bürgerliches Gesetzbuch, BGB), thus paving the way for an adjustment to commercial rent.

These new regulations informed the KG Berlin’s decision to affirm a reduction in commercial rent in response to the compelled closure of a business by government. In addition, the court held that it is not necessary to prove in individual cases that the tenant is facing an existential threat.

The tenant in the instant case was forced to close its arcade due to COVID-19 and for this reason only paid the commercial rent for the months of April and May in 2020 on a pro rata basis. The landlord subsequently demanded payment of the remaining rent. This claim was unsuccessful.

The federal city-state of Berlin ordered the lockdown in response to the coronavirus pandemic. The court ruled that the tenant could thus cite interference with the basis of the contract pursuant to Section 313 BGB and that the rent stipulated in the contract should therefore be reduced by 50 percent.

The Kammergericht reasoned that the contractual basis for renting commercial premises also encompasses the notion that economic and social life will not be brought to an almost complete standstill due to the onset of a pandemic and the resulting government-mandated closure of businesses. The court went on to point out, however, that this form of interference with the basis of the contract did occur and that the tenant had not been able to make use of the commercial premises in the manner envisaged by the contract.

This was said to go beyond the “normal” level of risk regarding whether the rental object is fit for purpose, with the court finding that this could not be borne by one of the contracting parties alone, i.e. the resulting negatives ought to be borne jointly by both parties. The KG Berlin therefore concluded that in cases such as this one where business premises are forced to completely close their doors, the commercial rent shall be halved.

While the Oberlandesgericht Dresden – the Higher Regional Court of Dresden – came to a similar conclusion in a similar case (Az.: 5 U 1782/20), the issue of whether commercial rent can be lowered ultimately comes down to the facts and circumstances of a given case. Experienced lawyers can provide counsel.

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

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Corona und gewerbliches Mietrecht
news-343 Fri, 14 May 2021 10:25:36 +0200 To qualify for tax exemption, it is necessary to move into the inherited family home without delay https://www.mtrlegal.com/en/news-and-press/detail/news/to-qualify-for-tax-exemption-it-is-necessary-to-move-into-the-inherited-family-home-without-delay.html Waiting too long to move into the inherited family home may render it impossible to claim tax exemption. That was the verdict of the Finanzgericht (FG) Düsseldorf – the Fiscal Court of Düsseldorf – in a ruling from March 10, 2021 (Az. 4 K 2245/19 Erb).

According to Section 13(1) No. 4 c) of the German Inheritance and Gift Tax Act (Erbschaftsteuer- und Schenkungsteuergesetz, ErbStG) the family home can be passed down tax-free if the testator has made personal use of it for their own residential purposes by the time of the accrual of the inheritance, or they have compelling reasons that prevent them from doing so and the party acquiring the property personally occupies it without delay. We at the commercial law firm MTR Rechtsanwälte note, however, that the living space must not exceed 200 square meters.

It is essential that the heir make use of the family home for their own residential purposes as soon as possible. The ruling of the Finanzgericht Düsseldorf clearly demonstrates that putting off the move for too long puts tax exemption at risk.

The heir in the case in question inherited the family home from her mother in July of 2016 and had intended to move in, but this did not happen until early 2018 because of extensive renovation work that needed to be carried out first.

And yet the renovations could probably have been completed sooner. The heir assigned the task of clearing out the house to a private individual who only had time to work on weekends, which meant the house was not cleared out until early 2017. The heir subsequently entered into discussions with tradesmen, but the assignment of the work was held up due to the already considerable workload of trade businesses. The new kitchen was ordered in August of 2017 and not fitted until December.

Since the period between the accrual of the inheritance and the occupation of the family home ultimately came to 18 months, it was held that the heir could not claim tax exemption. The Finanzgericht Düsseldorf ruled that a property cannot be said to have been occupied without delay where the relevant timeframe is 18 months.

The heir was aware of the substantial amount of renovation work to be done. The FG Düsseldorf held that she was at fault for not hiring a business to clear out the house. The court also found that she could have dealt with tradesmen and ordered a kitchen sooner.

When it comes to succession, it is important to be mindful of deadlines and tax allowances at all times. Lawyers with experience in the field of tax law can provide counsel.

For more information:

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

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PressemitteilungenErbschaftssteuer
news-341 Tue, 11 May 2021 09:27:01 +0200 BFH rules on recognition of stock losses for tax purposes https://www.mtrlegal.com/en/news-and-press/detail/news/bfh-rules-on-recognition-of-stock-losses-for-tax-purposes.html Losses from shares in companies facing insolvency can be claimed against tax from the point in time when the shares are written off the securities account. That was the verdict of the Bundesfinanzhof (BFH), Germany’s Federal Fiscal Court (Az.: VIII R 20/18).

The Bundesfinanzhof has delivered an important ruling on losses from shares in companies facing insolvency. We at the commercial law firm MTR Rechtsanwälte can report that, according to the court’s judgment from November 17, 2020, if the bank writes off these shares from the investor’s securities account before the company is deleted from the register, this gives rise to a loss that can be claimed against tax.

If the shareholder’s membership rights are extinguished because the company is dissolved, wound up and deleted from the register due to insolvency, and the shareholder does not regain all or part of their investment, they incur a taxable loss according to the BFH. If the shares are written off the shareholder’s securities account before the company is deleted from the register, the loss is deemed to have be realized at the point in time when the shares were written off.

The BFH went on to note, however, that it cannot be assumed that a loss has already been incurred at the point in time when an individual distribution of assets as part of the final distribution of the company's assets is objectively no longer expected or the listing on the stock exchange is discontinued.

The plaintiff in the case in question had acquired private assets in the form of shares in a publicly listed German stock corporation in 2009. The company subsequently became the subject of insolvency proceedings in 2012, with a unit price still being quoted for the shares in the plaintiff’s securities account as of December 31, 2013. The plaintiff then sought to have the total loss offset for 2013 income tax purposes against gains he had realized from the sale of shares in that year.

However, this request was dismissed by the BFH, which ruled that the version of the German Income Tax Act (Einkommensteuergesetz, EStG) in force during the relevant year contained an unintended loophole, according to which the plaintiff had not incurred a loss on disposal in 2013, as his membership rights in the company had not yet been extinguished and the shares were still being held in the securities account. The court therefore concluded that while the plaintiff had indeed suffered a depreciation in value, this did not yet amount to a taxable loss.

The ruling has implications for failed equity investments between the years 2009 and 2019. The legal loophole has been closed for tax assessment periods starting from 2020.

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

For more information:

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

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PressemitteilungenSteuerstreit
news-337 Thu, 29 Apr 2021 08:58:32 +0200 Finanzgericht Düsseldorf: No tax exemption for flat-rate bonuses https://www.mtrlegal.com/en/news-and-press/detail/news/finanzgericht-duesseldorf-no-tax-exemption-for-flat-rate-bonuses.html Bonuses for night work and working on Sundays are only tax exempt if they are awarded on an individual and not a flat-rate basis. That was the verdict of the Finanzgericht (FG) Düsseldorf – the Fiscal court of Düsseldorf – in a judgment from November 27, 2020.

Those who work nights or on Sundays and holidays are often rewarded with bonuses from their employer. However, according to a ruling of the Finanzgericht Düsseldorf from November 27, 2020, it is important to make sure that the bonuses are awarded on an individual and not a flat-rate basis (Az.: 10 K 1580/18 H(L)). We at the commercial law firm MTR Rechtsanwälte can report that bonuses are not considered to be tax exempt if they are not calculated on an individual basis.

The plaintiff in the case in question ran a cinema and would pay some of the employees a bonus for working nights and on Sundays. This was paid as a lump sum in addition to the basic wage and not calculated on an individual basis according to the amount of work involved, with the lump sum treated as tax exempt for payroll accounting purposes.

However, this was challenged by the tax office under whose jurisdiction the plaintiff fell. The tax office started from the assumption that tax was due on the bonuses and found that the conditions for tax exemption had not been met because the bonuses had been awarded on a flat-rate basis rather than individually according to the amount of work involved.

This was in turn challenged by the cinema operator, arguing that the way in which the flat-rate bonuses were calculated complied with the terms of Section 3(b) of the German Income Tax Act (Einkommensteuergesetz, EStG). The plaintiff pointed out that the flat-rate bonuses were actually smaller than would have been the case had they been calculated individually, and that the difference between these amounts was reported separately as unused bonuses.

The lawsuit was dismissed by the FG Düsseldorf, which found that the conditions set out in Section 3(b) EStG had not been met. The court affirmed that the plaintiff needed to have calculated the bonuses paid for working nights and on Sundays on an individual basis; merely performing a control calculation was not enough. The bonuses were deemed by the court to have been paid on a flat-rate basis without regard for the work that had actually been performed.

Lawyers with experience in the field of tax law can serve as advisors if disputes arise with the tax authorities.

For more information:

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

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PressemitteilungenSteuerstreit
news-336 Mon, 26 Apr 2021 09:39:47 +0200 Indications of origin: Black Forest ham need not be sliced in the Black Forest https://www.mtrlegal.com/en/news-and-press/detail/news/indications-of-origin-black-forest-ham-need-not-be-sliced-in-the-black-forest.html Black Forest ham (Schwarzwälder Schinken) may be referred to as such even if it is not sliced and packaged in the Black Forest. That was the verdict of the Bundesgerichtshof (BGH), Germany’s Federal Supreme Court (Az.: I ZB 72/19).

Geographical indications of origin can be protected in a similar manner to trademarks, something which can prove to be particularly important because of consumers associating a certain level of quality with a product’s geographical origin in some instances. We at the commercial law firm MTR Rechtsanwälte note, however, that it is disputed whether the protection afforded to a geographical indication of origin applies to all stages of production or the further processing of the product.

In the case of Black Forest ham, the BGH ruled in a recently published judgment from September 3, 2020 that it can be referred to as such even if it is not sliced and packaged in the Schwarzwald.

The case was part of a long-running legal dispute. The term “Schwarzwälder Schinken” has been protected since as early as 1997. In 2005, an association set up to protect the interests of Black Forest ham producers – the Schutzverband der Schwarzwälder Schinkenhersteller – wished to expand upon this protection in response to ham being increasingly sold in slices rather than in one piece. The association took the view that it should be a requirement to establish that the commercial slicing and packaging of the ham also took place in the Black Forest in order for someone to be able to use the protected term “Schwarzwälder Schinken”.

The European Court of Justice had already expressed its concerns on the matter, opining that while a ban on further processing outside the relevant geographical area can be justified, it needs to be a necessary and proportionate measure in order to maintain the quality of the product or guarantee its origin. The court noted, however, that the decision whether or not to allow Black Forest ham to be further processed outside of the Black Forest needs to be taken by German courts.

The Bundespatentgericht – Germany’s Federal Patent Court – subsequently ruled that Black Forest ham does not need to be sliced in the Black Forest, with this decision having since been upheld by the Bundesgerichtshof.

The BGH held that expanding the protection of the geographical indication of origin was necessary neither on grounds of quality assurance nor ensuring the effectiveness of inspections, noting that checks examining whether ham slices are no more than 1.3 millimeters thick and whether the cutting equipment is being properly cleaned can also be conducted outside the Black Forest, as this does not require product-specific know-how.

Lawyers with experience in the field of IP law can provide counsel on issues pertaining to copyright law and trademark law.

For more information:

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

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MarkenrechtPressemitteilungen
news-334 Tue, 20 Apr 2021 12:41:18 +0200 LAG Düsseldorf: Short-time workers on zero hours do not accumulate vacation leave https://www.mtrlegal.com/en/news-and-press/detail/news/lag-duesseldorf-short-time-workers-on-zero-hours-do-not-accumulate-vacation-leave.html Short-time working – Kurzarbeit in German – refers to a government scheme that allows businesses experiencing economic difficulties to temporarily reduce their employees’ working hours, with the state making up for all or part of the lost wages. Many firms have had recourse to this program for reasons related to COVID-19. The Landesarbeitsgericht (LAG) Düsseldorf – the Regional Labor Court of Düsseldorf – has now ruled that short-time work also entails a reduced entitlement to vacation leave (Az. 6 Sa 824/20).

A lot of firms have implemented short-time working in response to the coronavirus pandemic, with it being possible to reduce working hours to different degrees. We at the commercial law firm MTR Rechtsanwälte can report that, according to a ruling of the Landesarbeitsgericht Düsseldorf from March 12, 2021, in cases where work is suspended altogether – referred to as Kurzarbeit null (zero hours) – the employee does not accumulate entitlement to vacation leave during this period.

The lawsuit was filed by a saleswoman who found herself repeatedly in short-time work due to the coronavirus pandemic, at one point working zero hours continuously for a period of three months, with the employer reducing the entitlement to vacation leave for this period on a pro rata basis.

The saleswoman took action against this, arguing that she was entitled to the full vacation leave because short-time work had not been implemented at her request and did not constitute time off, as she was required, for instance, to comply with reporting obligations and remain on standby. In other words, she was not free to do as she pleased with the time.

Her lawsuit was unsuccessful before the LAG Düsseldorf, which found that she had not accumulated any entitlement to vacation leave under the German Federal Leave Act (Bundesurlaubsgesetz) for the period she was working zero hours. The court held that while vacations are meant to provide workers with time to rest and relax, this also presupposes an obligation to actually perform work. Both parties’ obligations of performance were deemed to have been suspended during the period of short-time work. The court therefore ruled that the entitlement to vacation leave be reduced on a pro rata basis for each full month of short-time work.

The LAG Düsseldorf considers this outcome to be line with European law, noting that workers do not accrue an entitlement to the minimum annual leave in Europe during periods of short-time work according to the case-law of the ECJ. The court went on to state that there are no provisions under German law that provide more favorable conditions to workers, remarking in particular that short-time work is not comparable to being unable to work and that there have been no changes to the rules in the wake of the coronavirus pandemic.

It remains to be seen whether the ruling will stand. The LAG Düsseldorf has granted leave to appeal to the Bundesarbeitsgericht, Germany’s Federal Labor Court.

Experienced lawyers can advise on issues relating to short-time work, vacation leave, as well as other matters that fall within the ambit of labor and employment law.

For more information:

https://www.mtrlegal.com/en/legal-advice/employment-law/coronavirus-and-short-time-work.html

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Corona und KurzarbeitPressemitteilungen
news-330 Thu, 15 Apr 2021 13:14:00 +0200 Greensill Bank: Customers unable to access their money – BaFin orders moratorium https://www.mtrlegal.com/en/news-and-press/detail/news/greensill-bank-customers-unable-to-access-their-money-bafin-orders-moratorium.html The Bundesanstalt für Finanzdienstleistungsaufischt (BaFin) – Germany’s Federal Financial Supervisory Authority – has closed down Greensill Bank’s business operations with its customers and filed criminal charges. Private investors as well as institutional investors and municipalities fear losing their money at the bank.

Greensill Bank was acquired by the British-Australian financial conglomerate Greensill Capital in 2014, with the parent company currently experiencing serious economic difficulties. According to media reports, an application for bankruptcy protection has already been submitted a few days ago in Australia and preparations are being made to file for insolvency in the UK, with the problems having now also reached Greensill Bank in Bremen.

Faced with the threat of over-indebtedness, the BaFin has closed down the bank’s business operations with its customers and ordered a moratorium. We at the commercial law firm MTR Rechtsanwälte can report that the bank can no longer pay out money to customers and is only allowed to accept payments if they are intended for settling debts with the bank.

One of the key focuses of the bank was the financing of supply chains, though it also offered attractive investment conditions to private investors as well as institutional investors and municipalities. The accounts have now been frozen and customers are unable to access their money.

Also of concern is that a forensic special investigation conducted by the BaFin revealed accounting irregularities. According to the BaFin, the bank failed to produce evidence to support the existence of receivables on its balance sheet, leading the supervisory authority to file criminal charges with the Bremen public prosecutor’s office.

On a rare positive note, each customer’s deposits are protected up to a value of 100,000 euros under the terms of the German Deposit Guarantee Act (Einlagensicherungsgesetz, EinSiG). Compensation will not be forthcoming, however, until the BaFin has determined that it is payable, which has not happened to date.

There is also the possibility of further payments under the deposit protection fund (Einlagensicherungsfonds) of the Association of German Banks (Bundesverband Deutscher Banken), though these would primarily benefit private investors, potentially leaving institutional investors and municipalities empty handed.

Accounting irregularities and criminal charges notwithstanding, customers and investors of Greensill Bank should waste no time in examining and exhausting every legal avenue available to them in order to protect themselves from the threat of financial losses.

For more information:

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

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BankrechtPressemitteilungen
news-327 Mon, 12 Apr 2021 13:23:24 +0200 BaFin determines that compensation is payable to depositors of insolvent Greensill Bank https://www.mtrlegal.com/en/news-and-press/detail/news/bafin-determines-that-compensation-is-payable-to-depositors-of-insolvent-greensill-bank.html As was to be expected, the Bundesanstalt für Finanzdienstleistungsaufischt (BaFin) – Germany’s Federal Financial Supervisory Authority – has determined that compensation is payable to Greensill Bank’s depositors, as the bank is no longer able to repay all of its customers’ deposits. Insolvency proceedings have also been initiated against the bank with the Amtsgericht Bremen, the District Court of Bremen (508 IN 6/21).

After ordering a moratorium on Greensill Bank and freezing the accounts, it was to be expected that the BaFin would file a bankruptcy petition for the bank and determine that compensation is payable to the bank’s depositors. This has since come to pass.

The bank’s private customers can now breathe a sigh of relief, since their deposits are protected up to a value of 100,000 euros under the German Deposit Guarantee Act (Einlagensicherungsgesetz, EinSiG). With the BaFin having determined that compensation is payable, payments can now be arranged to this end. We at the commercial law firm MTR Rechtsanwälte can report that there is also the possibility of additional payments under the deposit protection fund (Einlagensicherungsfonds) of the Association of German Banks (Bundesverband Deutscher Banken).

Yet by no means are all customers in the clear, as not all of them are protected under the terms of the Deposit Guarantee Act. The funds at risk include the deposits of public bodies such as municipalities, as well as the deposits of insurance and reinsurance companies and pension funds.

They now have until May 14, 2021 to register their claims in due form and time in the insolvency schedule. While it is currently not possible to estimate how large the insolvency dividend will be, the creditors should expect significant financial losses. Moreover, the insolvency proceedings may drag on for a number of years.

Customers of Greensill Bank whose deposits are not protected under the Deposit Guarantee Act or who come up against difficulties receiving compensation pay-outs can take further legal action to prevent financial losses.

One option is to have someone look into the possibility of asserting claims for damages. Parties against whom these potential claims may be asserted include the auditors who issued Greensill Bank its audit certificate, or individuals in positions of responsibility at the bank. It should be noted here that the BaFin’s investigations revealed accounting irregularities and the bank was unable to provide evidence indicating receivables on the balance sheet. The BaFin has filed criminal charges with the Bremen public prosecutor’s office.

Lawyers with experience in the field of banking law can advise customers of Greensill Bank who have been affected.

For more information:

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

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BankrechtPressemitteilungen
news-326 Thu, 08 Apr 2021 17:09:52 +0200 LG Berlin overturns fine for GDPR violation https://www.mtrlegal.com/en/news-and-press/detail/news/lg-berlin-overturns-fine-for-gdpr-violation.html In a remarkable ruling from February 18, 2021, the Landgericht (LG) Berlin – the Regional Court of Berlin – declared a million-euro fine imposed in response to a breach of the General Data Protection Regulation (GDPR) invalid.

We at the commercial law firm MTR Rechtsanwälte note that the extent to which companies or legal persons can be issued with a fine for data protection breaches is a contentious legal issue. The Landgericht Berlin has now taken a position on the matter in a judgment from February 18, 2021, making it clear that fines cannot be imposed on legal persons, Az.: (526 OWi LG) 212 Js-OWi 1/20 (1/20).

At the heart of this judgment is a fine of 14.5 million euros that was imposed by Berlin’s Commissioner for Data Protection and Freedom of Information on a real estate company for violating the provisions of the GDPR in the fall of 2019, with the Commissioner citing inadequate data protection standards regarding the retention of tenants’ personal data.

The LG Berlin subsequently overturned this fine, ruling that a legal person cannot be the subject of fine proceedings. This includes cases involving violations of GDPR provisions. The court held that only natural persons can be charged for committing an infringement, and the person in question must be a governing body within the company, a shareholder authorized to represent the company, or some other person in a managerial role, with only the conduct of the legal person’s officers and representatives capable of being attributed to the legal person.

This means that it is necessary to produce evidence proving that the infringement was committed by a person in a position of responsibility within the business before a fine can be imposed against the company for breaching the provisions of the GDPR. The court held that the data protection authority had failed to provide evidence proving that a person in a position of responsibility was in fact personally responsible and to conduct appropriate investigations. Accordingly, the fine was found to be invalid.

The ruling is not yet final. Berlin’s Commissioner for Data Protection and Freedom of Information has since lodged an appeal, arguing that the decision is not consistent with European law. It remains to be seen how the appeal court will rule on the matter.

Businesses ought to prepare themselves for data protection authorities increasingly looking into the personal misconduct of persons in positions of responsibility going forward. Experienced lawyers can advise on data protection issues.

For more information:

www.mtrlegal.com/en/legal-advice/it-law.html

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IT-RechtPressemitteilungen