Entries by Ester Hahn

EUROPEAN COURT OF JUSTICE (ECJ) LAYS DOWN SUBSTANTIAL DUTIES OF EMPLOYERS FOR THE RECORDING OF WORKING TIME BASED ON THE WORKING TIME DIRECTIVE

In its judgment of 14 May 2019 (case C-55/18) the ECJ ruled that the working time directive (Directive 2003/88/EC) required every employer to record the working time of employees and obliged each member state to ensure that each employer would set up an objective, reliable and accessible system measuring the duration of time worked each day by each employee.

WARRANTY FOR DEFECTS AND FRUSTRATION OF CONTRACT IN A COMPANY PURCHASE – EXCLUSION OF SECTION 313 BGB FROM SPAS REQUIRED?

Share Purchase Agreements (SPA) usually contain a – negotiated in detail, more or less extensive – catalog of guarantee declarations of the seller in connection with agreements on the legal consequences in the event of an incorrectness of a guarantee declaration. The statutory liability of the seller which generally exists in addition is usually excluded within the legally permissible framework. The decision of the German Federal Court of Justice [Bundesgerichtshof – BGH] of 26 September 2018 (file no. VII ZR 187/17) shows that it is important to focus in particular on the contractual exclusion of liability, especially its scope.

ALLOCATION OF RESPONSIBILITIES WITHIN THE GMBH MANAGEMENT

The managing directors of a limited liability company [Gesellschaft mit beschränkter Haftung – GmbH] may in principle carry out an allocation of responsibilities and duties among each other. The Federal Court of Justice [BGH] recently substantiated in a judgment of 6 November 2018 (file no. II ZR 11/17) the requirements for an admissibility of such an allocation of responsibilities between several managing directors of a GmbH and the duties of a managing director associated with that. The decision was based on the liability of a managing director of a GmbH for payments after the company’s insolvency.

HOPEFUL START OF LOSS DEDUCTION FOR CORPORATIONS

By resolution of 29 March 2017 the Federal Constitutional Court [Bundesverfassungsgericht – BVerfG] decided that the proportionate forfeiture of tax losses pursuant to section 8c para. 1 sentence 1 German Corporation Tax Act [Körperschaftsteuergesetz – KStG] old version is unconstitutional and called on the legislator to pass new regulations by 31 December 2018 which should eliminate the infringement of the constitution retroactively as of 1 January 2008. The legislator implemented this by removing without replacement the regulations on proportionate forfeiture of tax losses retroactively as of 1 January 2008 by passing the “Law for the Avoidance of Sales Tax Losses when Trading Goods on the Internet and for the Amendment of Further Law Regulations” ([Gesetz zur Vermeidung von Umsatzsteuerausfällen beim Handel mit Waren im Internet und zur Änderung weiterer steuerlicher Vorschriften – UStAVermG], also known under its original name “Annual Tax Act 2018”).