Important information in regard to the corona pandemic

Labour Law Information

Employers have a general duty of care for their employees. This includes that the employer must ensure that certain hygiene regulations are observed and that measures are taken to prevent the spread of diseases, e.g. by providing hand washing and disinfectants as well as specific hygiene recommendations. Depending on the circumstances of the specific case (e.g. intensive customer contact or in sales), the employer may also be obliged to take special measures to protect employees and, for example, to provide breathing masks. Further information and details are provided by the German health authorities and the Robert Koch Institute.

In the case of identifiable risks, the employer is also obliged to prevent possible contagion by returning employees by providing information and taking precautionary measures. For example, the employer is permitted to ask employees returning from a stay abroad whether they have stayed in an endangered region or in places with a significantly increased risk of infection. However, the employer’s claim is generally limited to negative information and the employee is regularly not obliged to provide information on the exact place of residence. The same applies regarding the employee’s request whether he/she has had contact with infected persons or persons suspected of being infected within the last 14 days.

The employer may also be entitled to order a medical examination of a returned employee if he has a legitimate interest in doing so, i.e. the employer’s interest exceeds the protected interests of the employee. This may be the case in particular if the employee was exposed to particular risks of infection and/or shows symptoms of a cold, so that there is a concrete risk of infection. In order to fulfil its duty of care towards other employees, the employer may, in justified cases, also order the release of an employee without or against his or her will, thus releasing him or her from the duty to perform and denying him or her access to the company grounds. The employer’s interest in suspension prevails in particular if there is a concrete risk of infection by the employee concerned with a contagious disease such as the corona virus.

Employees also have certain duties of consideration and information in respect of their employer. For example, the employee must inform the employer in particular if he was in close proximity to an infected person. In principle, the public health department orders domestic quarantine for the maximum duration of the incubation period (14 days) as soon as an employee is considered a contact person. The employee’s obligation to inform the health authority is not dependent on any quarantine measures taken by the responsible health authority. The Robert Koch Institute provides information on who is considered a contact person on its website.

Due to their general duty of loyalty to the employer, employees may also be required to work overtime, to the extent permitted under the Working Hours Act (Arbeitszeitgesetz), if the business operations would otherwise be impaired as a result of understaffing due to illness or quarantine.

If an employee has been infected with the corona virus, the employer is obliged to inform the competent health authority immediately.

All other employees who have had contact with the infected employee should be identified and tested for infection, if possible. In consultation with the health authorities, the employer must take further measures to protect the other employees and, if necessary, temporarily close the company. In this case, the employees are entitled to continued payment of wages and are not obliged to work extra hours afterwards.

The infected employee also has a general entitlement to continued remuneration in the event of illness in accordance with § 3 (1) EFZG. However, this does not apply if the employee is responsible for the illness. The employee may be assumed to be responsible, for example, if he or she has made a private trip to a risk area despite a travel warning from the Federal Foreign Office and is ill as a result of this trip or has deliberately had close contact with another infected person. In order to be able to check whether he is obliged to continue to pay remuneration, the employer is also entitled to ask questions in this respect, which, however, is likely to be limited to negative information.

The general answer is clearly: no.

Even if the number of new infections is currently rising daily and the concerns of the population are increasing, the employee’s obligation to perform his work is not affected by this in principle. Instead, he is still obliged to perform the tasks assigned to him and to follow the instructions of his supervisor. If the employee refuses, the employer can warn him and ultimately even dismiss him.

An employee’s right of retention only arises if the employer does not sufficiently fulfil his duty of care. However, this is only the case if the employee is able to prove that the performance of the assigned tasks actually constitutes a danger to health or life which the employer can avoid by taking appropriate occupational safety measures. Whether these conditions are given is to be checked in each case on the basis of the concrete individual case.

The employee who is not ill is not entitled to a general right of retention. This also applies to the handling of imported goods, as the risk of infection is very low in this respect according to the Robert Koch Institute and no infections with the corona virus from imported goods have been known to date. The obligation to provide the contractually owed work performance even remains in force if other employees return from a region in which (increased) cases of infection have already occurred or for which a travel warning has even been issued in this respect.

Employers may, however, comply with the employee’s request and release the employee unpaid from performing work or – if possible – conclude a home office agreement with the employee.

Whether or not an employee is obliged to travel on business is determined in principle by whether this is agreed in the employment contract. If the employee is obliged to do so and still refuses to go on a business trip, this can lead to consequences under employment law, up to and including dismissal.

This does not mean, however, that employees can be sent on business trips without restriction, as the arrangement of a business trip must be subject to fair discretion. In this context, the employer must always take appropriate regard to the protection of the employee’s health in particular, due to his duty of care. The employee will, however, be allowed to refuse business trips where he would be exposed to a considerable health risk due to the circumstances on site and his work. What this means in concrete terms is a question of the individual case. However, most companies are now refraining from sending their employees on business trips anyway, unless they are currently absolutely necessary for the maintenance of operations. In addition, the German government has currently and temporarily restricted the freedom to travel.

Whether and where the employee travels privately, on the other hand, is his decision alone and is not subject to the employer’s influence. Even if the Federal Foreign Office has issued a travel warning for a particular destination, the employer cannot prohibit his employee from travelling there, as this would constitute an unlawful encroachment on the employee’s right of personality. However, if the employee is unable to perform his work in accordance with the contract after a trip to such a region, the employer has the possibility to issue a warning.

In principle, the employee is responsible for the travel to and from work. As already explained, the employee may not stay at home out of fear of infection. This also applies if he has to travel to work by public transport. If the employee is also afraid of an increased risk of infection in this respect, it is up to him/her to organise travel to work in some other way. On the other hand, the employer cannot forbid the employee to travel to work by public transport. However, the employer can, for example, encourage car pooling among employees and subsidise it financially.

In the case that an authority quarantines employees in Germany and thereby imposes a ban on professional activity in accordance with §§ 30,31 of the Infection Protection Act (IFSG), the employer has payment obligations in accordance with § 56 IFSG. This means that for the duration of the employment relationship, but for no longer than six weeks, the employer must pay compensation to the employee instead of the authority responsible. The employer then has a claim for reimbursement against the authority in accordance with § 56 (5) IFSG. Pursuant to § 56 para. 11 IFSG, the claim must be asserted within three months after the cessation of the prohibited activity or the end of the separation. If, on the other hand, the employee is quarantined at the holiday location, it is impossible for him to perform the work and the employer’s obligation to pay compensation is cancelled in exchange.

If the employer decides to close his company for the protection of the employees, the employees still retain their right to payment. The same applies if the loss of working hours is due to an official closure of the company with the aim of protecting the employees against infection. The employer also bears the risk of not being able to employ the employee. This is because the business risk also includes, in particular, a lack of orders and disruptions in the course of business due to circumstances caused by the employer himself or by external factors.

Whether the employer can compensate for this in whole or in part by allowing employees to take holiday or reduce overtime during this time is a question of the individual case. From a legal point of view, employers do have the possibility of planning parts of the annual leave of employees as company holidays. However, this is only possible with a certain amount of advance notice, which also serves to provide planning security for employees. Since dealing with the corona virus requires short-term reactions and decisions, this option is likely to be dropped, at least if the employer wants to enforce it against the will of the employees. This means that the employer cannot simply send the employee home, taking into account vacation or overtime. This would require individual contractual arrangements or company agreements to be concluded, depending on the individual case. Whether and to what extent working time accounts can be reduced also depends on individual contractual provisions or provisions made within the framework of a works agreement. It therefore makes sense for the employer to make appropriate arrangements for this together with the employee and/or the works council – if there is one.

The introduction of short-time working may also be considered. Short-time work can be introduced on the basis of individual agreements, company agreements or collective agreements. In addition, it is possible to apply for short-time working allowance via the Federal Employment Agency, provided that the relevant legal requirements are met. The decision as to whether short-time work compensation is granted is determined in accordance with §§ 95 ff. of the German Social Code III and is the decision of the Federal Employment Agency.

In principle, there may be a claim to short-time working compensation as a result of a loss of working hours due to the corona virus. A precondition for the granting of short-time working compensation is in particular the substantial loss of work with loss of remuneration within the meaning of § 96 (1) no. 4 SGB III. In addition, the company must do everything possible to avoid short-time working.

The Federal Employment Agency provides further information and support on its website.

In principle, the general rule is that the place of work is the contractually agreed place of work.

As explained above, employees are still obliged to perform their contractually owed work at the agreed place of work, unless otherwise agreed in individual cases. An employee’s mere fear of contagion does not justify a claim to no longer have to appear at the workplace and to be able to work from home instead. On the other hand, however, the employer cannot unilaterally order the work in the home office without further notice. This only applies if the employment contract contains a corresponding provision, as the employer cannot base the order on his general right to issue instructions. If the employee therefore refuses to work in the home office in the absence of an employment contract, the employer cannot impose sanctions such as a warning or even a dismissal.

Especially in times like the Corona crisis, however, it is urgently recommended in the interest of both parties to find an mutually agreeable solution.

In the case of the home office, the employer must equip the employee in such a way that he/she can perform the contractually owed work from home. The costs for this are generally paid by the employer, unless otherwise agreed. The employer’s duty of care also extends to the home office, which means that the employer must also take into account the employee’s respective concerns in this environment and possibly take appropriate precautions to protect the employee (such as providing suitable desks and chairs etc.). The employer must also ensure compliance with the respective occupational health and safety regulations and, if necessary, carry out appropriate checks.

Even in the home office, the employee is in principle protected by the German Social Accident Insurance (DGUV), which pays for treatment and rehabilitation in the event of an accident at work. However, the insurance cover ends when the employee fetches a coffee or goes to the toilet, for example. The way from the home office to the company, on the other hand, is insured again.

Employees must also comply with business and trade secrets and data protection regulations in their home offices. This also applies in particular to business documents, which the employee may not simply leave lying around openly, but must be adequately protected from access by third parties.

The contractually agreed working hours also apply to work in the home office and the requirements of the Working Hours Act must also be respected here. The employee must therefore also comply with the previous working hours and in particular break and rest times in the home office and be available for the employer and colleagues. On the other hand, the employer must also observe and respect these times, i.e. he may no longer expect his employees to be reachable after the regular working hours.

If a child is ill and requires supervision and care, one parent can get this certified by a doctor. However, whether the employer is obliged to continue paying the remuneration is a question of the individual case.

According to § 616 BGB, the employer must continue to pay the remuneration if the employee is absent for a relatively insignificant period of time for personal reasons. This also includes the necessary care of sick children. What is considerable is again dependent on the individual case. However, about 10 days are probably still insignificant within the meaning of this provision. Special regulations on release from work and continued payment of remuneration in the event of personal incapacity to work, including in the case of sick family members, can be made in employment and collective agreements. In particular, certain maximum limits may be stipulated for days for which the employer must continue to pay the remuneration. These regulations then take precedence over the statutory provisions of § 616 BGB. In addition, a claim to remuneration in accordance with § 616 BGB may also be excluded in whole or in part in the employment contract or the collective agreement. It is therefore essential to examine each individual case.

If the employer is not obliged to pay remuneration, the health insurance fund pays child sickness benefit (§ 45 SGB V). There is an entitlement to child sickness benefit for ten days per year per child and parent. In the case of single parents, it is 20 days per child. For three or more children, it is a maximum of 25 days per year and parent, and for single parents it is 50 days accordingly. For the duration of this sick leave due to illness of the child, the employee is entitled to time off work from his or her employer and may be absent from work.

A distinction must be made between this and cases where the employee has to look after a child himself or herself due to a lack of childcare facilities. In the meantime, all German federal states have decided to close daycare centres and schools until (at least) the end of the Easter holidays on 19 April 2020.

For 16.03.2020 and 17.03.2020 a transitional arrangement still applied. Although no lessons were held on these two days either, schools and daycare centres provided temporary childcare staff for children whose parents had no other possibility of looking after their children.

In addition, only emergency care is to be provided which is aimed at the group of “indispensable key persons” defined by the state, i.e. members of those occupational groups whose activities serve to maintain public safety and order as well as medical and nursing care for the population and the maintenance of central functions of public life.

However, this offer is only available to a small proportion of employees, so that most parents have to reorganise their childcare at short notice. This is all the more challenging as it is strongly recommended that social contact be kept to a minimum and that grandparents, in particular, not be further involved in care at present, in order to protect them as a risk group from possible infection.

The closure of the day care centre/school can be an objective personal obstacle to the employee’s performance within the meaning of § 616 BGB. It depends on the circumstances of the specific individual case, in particular the age of the child, the possibility of care by third parties, etc. The employee has the obligation to do everything possible to avoid his or her hindrance or to keep it as short as possible. As far as the employee can refer to § 616 BGB for this short time, there is no obligation to work and the employee retains his claim to remuneration. However, this claim of the employee may also be excluded in this case by employment or collective bargaining agreements.

In regard to the announced closure period of day-care centres and schools, it is urgently recommended that employers and employees find an amicable solution if possible, e.g. through paid leave or unpaid leave. A temporary activity of the employee in the home office can also help here, provided that the work performance is not (significantly) impaired by the care of the child.

The above explanations show that dealing with the corona pandemic poses major and often new challenges for employers and employees. In the interests of all parties involved, it is therefore urgently recommended that in the current situation, solutions be found with the employees and/or works councils that are as consensual as possible, in order to maintain the peace in the company and to maintain operational processes with as few restrictions as possible.

Anja Bischopink, Attorney at Law, will of course be happy to answer any questions and provide further support in all matters relating to employment law.

Information on exchange contractual agreements

The corona pandemic has sometimes drastic effects on purchase contracts, work contracts, service contracts and loan agreements, and thus on exchange contracts of all kinds. Goods or services can no longer be delivered or provided, or only with considerable delay, due to the operational restrictions associated with the corona virus, or one simply has no use for them and thus no longer has any interest in a service that has already been agreed upon, so one no longer wishes to accept it and terminate the contract.

On the one hand, this raises the question of how to legally deal with the Corona crisis if you are not able to provide a service, only with considerable delay or only at additional cost.

On the other hand, there is the question of whether you or your customer can withdraw from an already concluded contract.

Restrictions associated with the Corona virus do not give you or your customer a right to refuse performance per se. It must always be checked whether the concrete facts of the case are suitable for invoking an impossibility in the legal sense according to § 275 BGB.

The law distinguishes here between different possibilities of impossibility
• absolute/factual impossibility (objective and subjective)
• Impossibility due to disproportionate effort
• Impossibility for services to be provided personally

Caution is especially necessary with alleged “official prohibitions”. On closer inspection, these sometimes turn out to be only permits subject to conditions or mere recommendations. Here it is doubtful whether a right to refuse performance arises from these facts.

The COVID 19 pandemic is having a considerable impact on legal traffic. The exchange of services, which until a few weeks ago was possible without any issues, is currently only taking place to a limited extent. For this reason, the law to mitigate the consequences of the COVID-19 pandemic was passed by the Bundestag and Bundesrat, which came into force on 27 March 2020. Article 5 of this law contains supplementary regulations for regular contract types of the German Civil Code. Article 5 covers leases and tenancies, loan agreements and rights of refusal for consumers and micro-enterprises.

Section 1 of the Act regulates rights to refuse performance in favour of micro-entrepreneurs and consumers.

This group has a right to refuse performance if a material continuing obligation (e.g. electricity, gas, telecommunications contracts) exists which was established before 8 March 2020 and the reason for the non-performance is directly related to the COVID-19 pandemic. The party refusing performance must be unable to fulfil its part of the contractual obligation without endangering its livelihood. The right to refuse performance is excluded if its assertion is unreasonable for the creditor. The validity of this moratorium does not extend to rental and lease agreements, loan agreements and claims of an employment law nature.

In this context the question inevitably arises under which conditions a threat to the debtor’s livelihood can be assumed. For example, is a debtor obliged to sell his assets first. The same applies to the question under which conditions it is unreasonable for a creditor to refuse performance.

In our opinion, these questions cannot be answered abstract without legal examination. We recommend invoking the “Corona right to refuse performance” in the case of continuing obligations only after legal advice.

Under the Corona Act consumer loan agreements concluded before 15 March 2020, the repayment, interest or repayment claims of the bank (= lender) are deferred for a period of three months if they fall due between 1 April 2020 and 30 June 2020. For this purpose, the consumer must suffer a loss of income due to the COVID 19 pandemic and the payment obligations must be unreasonable for him. Credit agreements may not be terminated during this period by reason of default of performance. Once the deferral period has expired, it is up to the contracting parties to amend the credit agreement in accordance with the situation. The scope of the new regulation for loan agreements has been extended to micro, small and medium-sized enterprises.

Whether a termination or withdrawal from the contract is possible due to the loss of a contractual partner’s interest in performance in connection with the Corona crisis is also not to be answered in a general manner, but only in the context of an individual case examination.

Here the question arises whether one must first set a period of time for performance as usual or whether a situation exists which makes the setting of a period of time for subsequent performance unnecessary.

This applies in particular in connection with so-called fixed-date transactions, i.e. transactions in which the provision of services is linked to a specific performance date. Whether a transaction is a transaction for delivery by a fixed date must be examined on the basis of the concrete agreement on the content of the service. Often it turns out after a legal examination that one only meant that an absolute fixed date was agreed upon, but in the end it is only a so-called relative fixed date transaction, in which the time of performance is of decisive importance, but the performance can basically still be made up for. It is not uncommon for a legal examination to reveal that no specific date of performance has been agreed.

Therefore, caution should be exercised with premature terminations or resignations stating the reason “Corona crisis”, as unjustified terminations or resignations generally entitle the other party to claim damages.

Landlords are prohibited from giving notice of termination in a lease if the termination is based on the fact that the tenant has not paid the rent due between 1 April 2020 and 30 June 2020 and the reason for the non-payment of rent was caused by the effects of the COVID 19 pandemic. This is intended to counteract the risk of tenants losing their living space due to late payments. Furthermore, the existence of commercial tenants is to be secured if the COVID 19 pandemic damages their businesses. However, tenants should not be tempted by this to defer rent payments that are already due. In case of default of rent payments, default interest has to pe paid.

Whether a right to refuse performance exists in connection with a restriction caused by the Corona virus or even give you the right to withdraw from a contract always requires a legal examination of the individual case.

Please contact us in advance in order to avoid claims for damages that may result from an unjustified refusal to perform or termination. This is especially important in view of the fact that claims for damages are not limited by law to the value of the goods or the contract volume.

Insolvency law information

On 25 March 2020, the German Bundestag unanimously adopted the bill to mitigate the consequences of the COVID 19 pandemic in civil, insolvency and criminal law. It will be discussed in the Bundesrat on 27 March 2020 and will then enter into force shortly. Among other things, the draft contains important new regulations in insolvency law, which are of major importance both for the companies concerned and for their business partners (draft law on the suspension of the obligation to file for insolvency, COVInsAG)

In particular, the COVInsAG is intended to create a suspension of the obligation to file for insolvency for companies that suffer economic losses due to the massive increase in infections with the SARS-CoV-2 virus.

It is intended to avoid a situation where a company has to file for insolvency simply because its application for public assistance in the context of the corona pandemic has not yet been processed or financing or restructuring negotiations have not yet led to success.

The obligation for companies affected by the corona pandemic to file for insolvency is to be suspended for the time being until 30 September 2020. However, the Federal Ministry of Justice and Consumer Protection (BMJV) is authorised by law to extend the suspension of the obligation to file for insolvency by statutory order until 31 March 2021.

If there are no realistic prospects of restructuring at a later date, the usual obligation to file for insolvency remains in force within three weeks.

There is provision for relief from the liability of company management for payments made after insolvency proceedings have been initiated. The payment prohibitions linked to insolvency maturity (§ 64 sentence 1 GmbHG, § 92 para. 2 sentence 1 AktG) are relaxed in this respect.

The debtor’s business partners will be better protected against later challenge:
If insolvency has occurred, there is always the risk that the debtor’s business partners will have to surrender services and payments as a result of later challenges by the insolvency administrator. This could deter business partners from making payments and, in particular, from making payments during the crisis.

For this reason, under the planned new regulation, legal acts which have granted or enabled the other party to secure or satisfy claims which the other party was entitled to claim are not contestable in subsequent insolvency proceedings, unless the other party was aware that the debtor’s restructuring efforts were not suitable for eliminating an insolvency which had occurred. This is intended to create incentives to inject new liquidity into the companies concerned and to maintain business relations with them.

The repayment by 30 September 2023 of a new loan granted during the suspension period and the provision of collateral to secure such loans during the suspension period should not be considered a creditor disadvantage.

This shall also apply to the restitution of shareholder loans and payments on claims arising from legal acts which are economically equivalent to such a loan. In addition, the granting of loans and securities during the suspension period shall not be considered an immoral contribution to the delay in filing for insolvency.

For a three-month transitional period, the right of creditors to request the opening of insolvency proceedings will also be restricted.
For creditors’ insolvency applications filed within three months of the Act coming into force, insolvency proceedings will only be opened if the reason for opening them already existed on 1 March 2020.

The planned „Act to Mitigate the Consequences of the Covid 19 Pandemic” creates important new regulations in order to maintain business and legal relations in Germany as far as possible even in times of crisis and immediately afterwards.

We will support you in setting the right course now and making the best possible use of future changes for your company.

Information on government support for enterprises

The COVID 19 pandemic poses a challenge to Germany not only in terms of health. In economic terms, too, the production stops and low demand in many industries pose a threat to large and small companies alike. For this reason, the Federal Ministry of Finance announced on 23 March 2020 that the largest aid package in the history of Germany is being prepared for this purpose.

The federal government has reserves of fifty billion euros to provide immediate financial support to smaller companies, freelancers and the self-employed.

Initially, subsidies are provided for the first three months, which are not subject to any repayment obligation. This immediate aid will be granted as an additional benefit to the aid packages of the federal states. For this purpose, however, the corresponding applications must be submitted by the recipients. Which authorities are responsible for this is still pending. The emergency aid consists of the following grants:

– Whoever is self-employed or runs a company with up to 5 employees receives up to 9,000 euros.

– Those who are self-employed or run a company with up to 10 employees receive up to 15,000 euros.

Financial assistance is also planned for larger companies.

The Federal Republic of Germany is setting up a fund for the stabilisation of the economy, whose target group is large companies and which provides assistance in larger amounts. The fund includes the following:
– 100 billion euros are planned for capital measures.
– 400 billion euros are planned for guarantees.
– 100 billion is to be used to refinance KfW programmes that have already been approved.

Tax relief should apply to companies of all types and sizes.

Until 31 December 2020, companies affected by the consequences of the corona pandemic should receive assistance as follows:- Tax debts will be temporarily deferred by the tax authorities;
– advance tax payments are to be adjusted upon request;
– enforcement measures will not be taken.
– Companies have the option of applying for short-time work compensation if at least 10% of the employees are affected by the loss.

Additional information on the above measures and other planned state aid can be found at

In order to be able to benefit from the promised state aid, it must be examined on a case-by-case basis whether the respective conditions are met. We will be happy to support you in all legal issues in connection with the Corona aid package.

Compensation payments and claims

On 30 March 2020, the law for the protection of the population in the event of an epidemic situation of national importance came into force.

It contains various amendments to the Infection Protection Act (IfSG), including an extension of § 56 IfSG, which regulates compensation possibilities, by adding section 1a:

§ 56 para. 1a IfSG is worded analogously:

„If childcare facilities or schools are temporarily closed or closed down by the competent authority to prevent the spread of infections or communicable diseases on the basis of this Act, or if their entry is prohibited and if employed custodians of children who are under 12 years of age or disabled and in need of assistance have to take care of the children themselves during this period because they cannot provide any other reasonable care, and if they suffer loss of salary as a result, they shall receive compensation in money. Beneficiaries must prove to the competent authority, and at the employer’s request to the employer, that they are unable to provide reasonable care for the child during this period. A claim does not exist if a closure would take place anyway because of the school holidays. In the case that the child has been taken into the household in full-time care pursuant to § 33 of Book Eight of the Social Code, the claim to compensation is entitled to the foster parents instead of the persons with custody.“

The provision is provisionally in force until 31 December 2020.

The new introduction of § 56 para. 1 a IfSG enables parents to receive compensation under this law if they suffer loss of earnings during a pandemic due to the need for childcare. The entitlement to compensation requires that parental care is necessary and the loss of salary cannot be avoided – for example, by reducing the amount of overtime. Also claims for short-time work compensation must be considered with priority.

According to § 56 para. 1 a IfSG, the loss of salary of employed persons is compensated over a period of up to 6 weeks if they have to care for their children under 12 years of age due to the closure of schools and day care centres and are therefore unable to work. The compensation of 67 % of the net income is limited to a maximum amount of EUR 2,016.00 and the employer has to pay the loss of earnings in advance. He can then apply to the competent authorities for reimbursement of the amounts paid out. The competent authorities in North Rhine-Westphalia are the Landschaftsverbände Rheinland in Cologne and Westfalen-Lippe in Münster.

Information on Corporate Law

In the wake of the corona pandemic, the Bundestag and the Bundesrat passed the “Act on Mitigation of the Consequences of the Covid 19 Pandemic” (hereinafter: “Corona Act”), which was published in the Federal Law Gazette on 27 March 2020. The law also brings along legal changes in corporate law, which are described below.

In the areas of corporate law regulations have been introduced with the aim of enabling companies to pass necessary resolutions and remain capable of acting even if restrictions on personal contact remain to exist.

§ 48, Subsection 1, GmbHG, provides that the resolutions of the shareholders are passed in shareholders meetings. In § 48 exp. 2 GmbHG it is regulated that the holding of a personal meeting is not required, if all shareholders agree upon that in text form.

The Corona Act stipulates that, in deviation from § 48 Paragraph 2 GmbHG, resolutions of the shareholders can also be passed in written submission of votes even if not all of the shareholders consent on that. The Corona Act does not contain any further provisions in this regard. In our opinion, this amendment is only relevant in those cases in which the articles of association of the GmbH do not contain any provisions deviating from the statutory law with regard to written resolutions. As follows from § 45 exp. 2 GmbHG, the written procedure in accordance with § 48 exp. 2 GmbHG, can be both excluded by the articles of association and extended by other forms of resolution. The amendment by the Corona Act has therefore no effect on the relevant regulations in articles of association, as § 45 exp. 2 GmbHG has remained untouched.

In cases where the articles of association do not contain a provision that deviates from the statutory law, the question arises as to whether there must be a certain quorum of shareholders (e.g. more than 50 % of the shares) who give their consent to a written resolution. The only thing that is certain is that a written resolution may not be passed if none of the shareholders agrees to it. The Corona Act does not stipulates other criteria. This is probably because it was done in a rash. Unfortunately, the Corona Act thus opens up considerable legal uncertainties in its application.

In our opinion, the Corona Act also has no effect on what can be the subject of a written resolution under previous case law. Therefore it remains that according to current case law, where notarisation is required, e.g. in the case of an amendment to the Articles of Association, voting can only take place in a personal shareholders meeting.

The Corona Act does not contain any changes with regard to shareholder resolutions for partnerships. It therefore remains the case that the passing of resolutions in partnerships is governed by the provisions of the articles of the partnership and, if no such agreement exists, by the general rules.

The Corona Act also contains changes in corporate law with regard to other legal forms of company, namely the stock corporation, the partnership limited by shares, the SE, the mutual insurance company, the association, the foundation, the cooperative and the condominium owners’ association. For these types of companies the Corona Act facilitates the possibility for holding meetings using means of distance communication.

For reasons of clarity, we do not illustrate the changes for these forms of companies, but if you are a managing director or shareholder of such a company, we are happy to advise you.

Notwithstanding Section 17 (2) sentence 4 of the Transformation Act, it is sufficient for the admissibility of the registration if the balance sheet has been prepared for a record date not more than twelve months prior to the application.
Previously, the registration court was only allowed to register the merger if the balance sheet had been prepared as of a record date which was not more than eight months prior to the filing date.