PLANNED DUTY OF DISCLOSURE FOR TAX ARRANGEMENTS

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On 25 May 2018, the ECOFIN Council, consisting of the Ministers of Economics and Finance, passed the Directive (EU) 2018/822 amending Directive 2011/16/EU on the mandatory automatic exchange of information in the field of taxation on relation to reportable cross-border arrangements. This is intended to create an obligation to report potentially aggressive tax-planning arrangements. The directive must be transposed into national law by 31 December 2019. The disclosure obligation will come into force on 1 July 2020.

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RESTRUCTURING CLAUSE – ECJ DECLARES AID DECISION NULL AND VOID

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A change of shareholder can lead to a proportional or complete elimination of the existing losses of a company. However, this shall not apply if the acquisition of the investment is made with the aim of restructuring the company. Up to now, however, the EU Commission has regarded this so-called restructuring clause as state aid. The European Court of Justice [ECJ] has recently declared this state aid decision null and void. Therefore, the restructuring clause can be applied again.

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REAL ESTATE TRANSFER TAX REFORM WITH RESPECT TO SHARE DEALS

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On 8th September 2016, the federal states of Hesse, North Rhine-Westphalia and Schleswig-Holstein decided to implement a working group with respect to an intended reform of the real estate transfer tax. The reform targets to close down loopholes with respect to structures which are considered abusive regarding the sale of company shares which (mainly) hold real estate properties. Such working group presented a working paper with the key points for new statutory provisions on 21th June 2018.

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LIMITED PARTNER OF A GMBH & CO. KG HAS NO RIGHT OF ACTION AGAINST A THIRD-PARTY MANAGING DIRECTOR OF THE GMBH & CO. KG’S GENERAL PARTNER

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According to consistent case-law of the Federal Court of Justice [Bundesgerichtshof – BGH], shareholders can assert certain claims against a fellow partner as litigants in the way of “actio pro socio”. Up to now, it had been a matter of dispute whether or not the limited partner of a GmbH & Co KG is also granted the right to assert claims of a limited partnership against a third-party managing director of the GmbH & Co KG’s general partner. In its decision II ZR 255/16 dated 19.12.2017, the BGH denied this right.

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INFORMATION RIGHT UNDER THE REMUNERATION TRANSPARENCY ACT

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As of 6 January 2018, under the Remuneration Transparency Act [Entgelttransparenzgesetz – EntgTranspG], employees can demand information from their employer about the remuneration of colleagues of the opposite sex working in the same or an equivalent occupation. What is important and how can you keep bureaucracy to a minimum?

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THE FEDERAL CONSTITUTIONAL COURT HAS RULED: THE RESTRICTION OF “PREVIOUS EMPLOYMENT” BY THE FEDERAL LABOR COURT IS NOT COMPATIBLE WITH THE GERMAN CONSTITUTION

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The years of criticism of the case law of the 7th Senate of the Federal Labor Court [Bundesarbeitsgericht – BAG] by the Regional Labor Courts and the literature have shown their effect: On 6 June 2018, the Federal Constitutional Court [Bundesverfassungsgericht – BVerfG] overruled the BAG’s previous case law on the prohibition of pre-employment in the case of unfounded time limits, leaving legal uncertainty behind. The three-year limit developed and applied by the BAG contradicts the Constitution, according to the BVerfG.

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