GERMAN ACT TO STRENGTHEN GROWTH OPPORTUNITIES, INVESTMENTS AND INNOVATION AS WELL AS TAX SIMPLIFICATION AND TAX FAIRNESS (GROWTH OPPORTUNITIES ACT) – KEY CHANGES

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The much-discussed and long-awaited Growth Opportunities Act came into force on March 28, 2024. This law is intended to strengthen Germany as a business location by creating various tax incentives for investment. The law is also intended to simplify taxes and increase tax fairness. Some changes that were planned in the legislative process were not implemented due to criticism from the Bundesrat. Nevertheless, the Growth Opportunities Act brings changes in almost all areas of tax law.

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INTERIM INJUNCTION IN THE EVENT OF DISMISSAL OF THE MANAGING DIRECTOR OF A TWO-PERSON GMBH (GERMAN LIMITED LIABILITY COMPANY) FOR GOOD CAUSE

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If there is a dispute about the validity of the dismissal of a managing director of a GmbH, an interim injunction can be issued prohibiting him from performing his duties and from acting as a member of the management board. In addition to the dismissed managing director, the company, represented by a representative appointed by the shareholders, is generally a party to such injunction proceedings. In a recent decision (judgment of 25.05.2023 – 23 W 354/23e), the Munich Higher Regional Court (OLG Munich) addressed the question of whether and under what conditions interim legal protection can be obtained by the other shareholder by way of a so-called actio pro socio and thus also regardless of the majority situation in the company when a shareholder managing director in a two-person GmbH is dismissed.

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EXCLUSION OF A LIMITED PARTNER FOR GOOD CAUSE

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If there is good cause in the person of a limited partner that makes the continuation of the partnership relationship unreasonable for the other partners, the other partners may exclude this partner from the partnership. The resolution on the exclusion provided for in the articles of association does not have to be passed immediately. The judgment of the Higher Regional Court of Hamm (judgment of 1.3.2023 – 8 U 48/22) deals in an exemplary manner with the question of the conditions under which waiting by the shareholders entitled to exclusion is justified and does not refute the assumption of the existence of good cause or unreasonableness.

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THIRD-PARTY SERVICES AS CONSIDERATION FOR REAL ESTATE TRANSFER TAX PURPOSES

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In accordance with Section 9 (2) no. 4 GrEStG, the assessment basis for real estate transfer tax also includes payments made by a third party to the seller of the property for the acquisition of shares in the future property-owning company if the main purpose of these payments is to induce the seller of the property to transfer the property to the company.

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