The supervisory board’s comprehensive duty to gather information, even during a suspension of business operations
In its decision of October 14, 2025 (Case No.: II ZR 78/24), the Federal Court of Justice clarifies: Even when business operations are suspended, the Management Board’s duty to report (at least) quarterly remains in effect – and with it, the Supervisory Board’s duty to consistently monitor compliance with this requirement. Informal information provided during […]
Responsibilities and legal remedies in a bipartite limited liability company
If a shareholder wishes to enforce claims for damages against a non-shareholder managing director of the company, they must, in principle, choose the route via the company. The German Federal Court of Justice (BGH; judgment of 5 November 2024 – II ZR 85/23) clarifies the principles governing shareholder actions in a German limited liability company […]
Termination of managing director service agreements
There has long been a divergence in case law between the German Federal Court of Justice (Bundesgerichtshof, BGH) and the German Federal Labour Court (Bundesarbeitsgericht, BAG) regarding which notice periods apply when terminating a managing director service agreement. In its judgment of 5 November 2024 (II ZR 35/23), the BGH reaffirmed its legal position on […]
Digitalisation of registered mail calls prima facie evidence into question
The current registered mail process (“Einwurf-Einschreiben”) of Deutsche Post, which is based on digital tracking, no longer provides prima facie evidence (Anscheinsbeweis) of receipt by the addressee. This marks a change from the previously used “peel-off label” system, which offered physical proof of delivery. According to the Hamburg Regional Labour Court (LAG Hamburg, judgment of […]
Vesting clauses in employee participation programs put to the test – a follow-up
In July, we already discussed the new ruling by the German Federal Labour Court (BAG) regarding virtual share option rights (ESOP / VSOP). The now published written judgments with full reasoning provide further insight into the landmark decisions from March and warrant renewed analysis. In its reasoning, the BAG emphasizes that virtual share options are […]
Duty to record working hours – federal labor court publishes reasons for decision
The Federal Labor Court (Bundesarbeitsgericht – BAG) has published the reasons for its decision of 12 September 2022 (1 ABR 22/21) regarding the obligation of employers to record working hours. Not all details have yet been clarified regarding the employer’s obligation to record the working hours of its employees, which is effective immediately. It remains […]
The introduction of Commercial Courts in Germany
With the ECJ ruling dated 14 May 2019 that employers must enable the recording of working time by means of an objective, reliable and accessible system, ambiguity arose as to what extent this also has an impact on the burden of presentation and proof in lawsuits brought by employees for compensation for overtime. The Federal […]
Commencement of the limitation period for claims by the employer based on a breach of competition rules pursuant to § 60 para. 1 German Commercial Code
In its ruling of 24 February 2021 – file no. 10 AZR 8/19 – the 10th Senate of the Federal Labor Court (Bundesarbeitsgericht – BAG) decided that the limitation period under § 61 para. 2 German Commercial Code (Handelsgesetzbuch – HGB) in the case of anti-competitive conduct by an employee already begins with an employer’s […]
Scope of the negative legitimation effect of the list of shareholders of a GmbH
In a more recent decision, the Federal Court of Justice (ruling of 26. January 2021, case no. II ZR 391/18) has once again dealt with the so-called negative legitimation effect of the list of shareholders pursuant to sec. 16 para. 1 sentence 1 GmbHG within a short period of time. According to this, only the […]
Tax relief for employee participation programs in startups
On 20 January 2021, the German government passed a draft legislation to strengthen Germany as a fund location and to implement Directive (EU) 2019/1160 amending Directives 2009/65/EC and 2011/61/EU with regard to the cross-border marketing of collective investment schemes (German Fund Location Act (Fondsstandortgesetz) – FoG), which also provides for tax relief for employee participation […]