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Politics Law Society

General Data Protection Regulation (GDPR) must be implemented by May 25, 2018

General Data Protection Regulation (GDPR) must be implemented by May 25, 2018

General Data Protection Regulation (GDPR) must be implemented by May 25, 2018

Businesses need to keep May 25, 2018 in mind. This is the day when the EU General Data Protection Regulation, GDPR for short, officially comes into force.

Following a two-year transitional period, the GDPR will come into full force and effect on May 25, 2018, thereby replacing an EU directive dating back to 1995. The GDPR is meant to create a uniform standard for data protection within Europe and provide consumers with greater protection in the digital age. The GDPR shall have precedence over national law. Notwithstanding this, we at the commercial law firm GRP Rainer Rechtsanwälte note that the European Regulation leaves many details open and provides for a certain amount of leeway for national rules and regulations.

In principle, the GDRP applies to all businesses within the EU that gather, record and process personal data. It concerns not only customer or client data, but also data pertaining to company employees. Businesses will now be subject to extensive information and documentation obligations. The more sensitive the data collected is, the stricter the data protection rules are.

For businesses, the implementation of the GDPR means more stringent requirements relating to data protection compliance, especially considering that violations of the Regulation can be severely punished. Fines of up to 20 million euros or up to 4 per cent of worldwide annual turnover can be imposed. Moreover, violations of the GDPR may also be penalized as violations of competition law.

Businesses need to communicate what personal data is being gathered and for what purpose. Personal data refers to information such as name and address, contact details, birthday, IP addresses etc. In short, all data that is likely to allow a person to be identified. This data cannot be collected without consent and has to be processed for a specific purpose or purposes in a transparent and comprehensible manner. Additionally, those concerned have the „right to be forgotten“, i.e. the data must be deleted once the purpose has been achieved. To ensure that data is protected, appropriate technical precautions need to be taken.

The GDPR entails complex changes to data protection law which businesses and employers need to be prepared for. Should violations of the GDPR occur, one should also anticipate formal warnings. To prevent this from happening, it is necessary to obtain expert legal advice or even appoint an external data protection officer.

https://www.grprainer.com/en/legal-advice/it-law-and-media-law/data-protection.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

CJEU on protected designations of origin

CJEU on protected designations of origin

CJEU on protected designations of origin

As in the case of brands, geographical designations of origin can be protected as well. It is therefore also possible for advertising featuring references to origin to be misleading to consumers and thus impermissible.

Brands and geographical designations of origin are of great value to businesses. They give rise to certain associations among consumers, e.g. in relation to the quality of a product. We at the commercial law firm GRP Rainer Rechtsanwälte note that for this reason the protection of brands and designations of origin is all the more important.

Having said that, a ruling of the Court of Justice of the European Union (CJEU) from December 20, 2017 demonstrates that the protection afforded to designations of origin can have its limits (Az.: C-393/16). The case before the CJEU concerned a legal dispute between a discount supermarket and an association of champagne producers. The discount supermarket offered ice cream under the name „Champagner Sorbet“ (champagne sorbet). The association brought a legal action against this, arguing that it constituted a violation of the protected designation of origin (PDO) „champagne“.

The case ended up before the Bundesgerichtshof (BGH), Germany“s Federal Supreme Court, which in turn requested that the CJEU interpret EU legislation pertaining to the protection of registered designations of origin.

The CJEU held that a protected designation of origin has been exploited improperly if the intention behind using the designation is to unduly benefit from its reputation. According to the Court, the designation „Champagner Sorbet“ was able to benefit from the prestige of the protected designation of origin „champagne“ because consumers associate the latter with a certain class of goods and price range. Notwithstanding this, use of the designation was said not to be illegal if an essential quality of the product is its predominantly champagne flavour, a matter which the CJEU concluded was for the BGH to address.

However, unlawful use might have occurred in the case of a sorbet that, despite the impression given by references in its design or outer packaging, does not include a champagne flavour as one of its essential qualities. References of this kind could be deemed incorrect and misleading. The Court ruled that the protection afforded to registered designations of origin extends beyond the origin of the product in question to incorrect or misleading references pertaining to its nature or essential qualities.

Violations of trademark law or copyright law can be met with severe penalties. Lawyers who are experienced in the field of intellectual property law can advise businesses on enforcing or fending off claims.

https://www.grprainer.com/en/legal-advice/intellectual-property-law-and-trademark-law/trademark-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Antitrust law – DFB simplifies ticket allocation for 2018 World Cup

Antitrust law – DFB simplifies ticket allocation for 2018 World Cup

Antitrust law - DFB simplifies ticket allocation for 2018 World Cup

The way in which it has allocated tickets has led the DFB, Germany“s Football Association, to be suspected of abusing its dominant market position. The Bundeskartellamt, Germany“s Federal Cartel Office, has since suspended its investigations into the matter.

A lot of fans of the German national football team would like to watch the team“s games live in the stadium, but getting hold of the relevant tickets for the 2018 World Cup or the away matches during the qualification phase has proven extremely difficult because the DFB linked the allocation of the tickets to membership of the German national football team“s fan club. The annual fee for the membership was 40 euros.

A large number of complaints were made against this way of allocating tickets, and the Bundeskartellamt initiated administrative procedures against the DFB on suspicion of misuse of a dominant market position. The Bundeskartellamt has confirmed that the proceedings have since been suspended. Prior to this, the DFB had committed to easing the conditions for applying for tickets to the 2018 World Cup in Russia.

Following consultation with the Bundeskartellamt, it is now possible for fans to obtain significantly cheaper and temporary tournament membership for ten euros and apply for tickets. The background to the DFB“s decision to link ticket allocation to membership of the fan club was to thereby ensure greater safety in the stadia. This argument influenced the cartel watchdog“s decision.

We at the commercial law firm GRP Rainer Rechtsanwälte note that abusing a dominant market position can give rise severe penalties, as antitrust law is supposed to ensure there is diverse competition in the interests of consumer protection. Violations of antitrust law or competition law may therefore entail appropriate sanctions, which can in turn lead to costly and time-consuming legal disputes.

To avoid legal disputes arising from possible violations of competition law or antitrust law, lawyers who are experienced in the field of antitrust law ought to be consulted early on. They can assess whether there are concerns from the perspective of antitrust law and overcome potential problems. If specific accusations and claims have already been made due to alleged violations, experienced lawyers can assume responsibility for fending these off. Of course, the same is also true in the reverse case, i.e. if there is an intention to assert claims for violations of antitrust law.

https://www.grprainer.com/en/legal-advice/antitrust-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

BGH – Bank must explain risk if interest rate dependent on exchange rate

BGH – Bank must explain risk if interest rate dependent on exchange rate

BGH - Bank must explain risk if interest rate dependent on exchange rate

If the interest rate on a loan is based on the development of exchange rates, the bank has a duty to inform with respect to the foreign exchange risk. That was the verdict of the Bundesgerichtshof (BGH), Germany“s Federal Supreme Court, in a recent ruling (XI ZR 152/17).

The appreciation of the Swiss franc against the euro has caused problems for a number of borrowers. Notwithstanding this, the relevant bank must explain the exchange rate risk present. We at the law firm GRP Rainer Rechtsanwälte note that according to a judgment of the Bundesgerichtshof from December 19, 2017, this duty to inform also applies if the interest rate on a loan is based on the exchange rate.

The instant case concerned a loan in the amount of approximately 3 million euros that had been taken out by a municipality in North Rhine-Westphalia. The interest rate for the first 20 years was supposed to be 3.99 per cent p.a. assuming an exchange rate from euros to Swiss francs equal to or greater than 1.43. In the event of the euro falling below this threshold, the interest rate would then be 3.99 per cent plus half of the change in the exchange rate from 1.43. During the consultation, the bank pointed out that the Swiss National Bank, Switzerland“s central bank, would adopt a zero interest rate policy in the event of the Swiss franc appreciating and that their threshold for intervention was 1 euro to 1.45 Swiss francs. Additionally, there was a table showing the respective interest rate for exchange rates ranging from 1.39 to 1.65. From a rate of 1.42 to 1.39, the interest rate increased incrementally from 4.34 to 5.43.

In the end, the franc appreciated so strongly that the municipality was supposed to pay an interest rate of 18.99 per cent p.a. It therefore considered the loan agreement to be unjust and void. Moreover, it claimed that the foreign exchange risk had not been properly explained. Despite the municipality“s claim being unsuccessful before the first two courts of instance, the BGH reached a different conclusion.

Although the loan agreement was not found to be unjust, the bank had failed to fulfil its duty to inform. While the dependent relationship between the interest rate and the exchange rate was said to be apparent from examining the agreement, the bank had not explained with sufficient clarity the risks associated with an obligation to make interest payments based on an exchange rate, but instead downplayed these. The court of appeal must now rule on the case anew.

When it comes to problems concerning loan agreements, lawyers who are experienced in the field of banking law can serve as competent advisors.

https://www.grprainer.com/en/legal-advice/banking-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

BGH – Bank must explain risk if interest rate dependent on exchange rate

BGH – Bank must explain risk if interest rate dependent on exchange rate

BGH - Bank must explain risk if interest rate dependent on exchange rate

If the interest rate on a loan is based on the development of exchange rates, the bank has a duty to inform with respect to the foreign exchange risk. That was the verdict of the Bundesgerichtshof (BGH), Germany“s Federal Supreme Court, in a recent ruling (XI ZR 152/17).

The appreciation of the Swiss franc against the euro has caused problems for a number of borrowers. Notwithstanding this, the relevant bank must explain the exchange rate risk present. We at the law firm GRP Rainer Rechtsanwälte note that according to a judgment of the Bundesgerichtshof from December 19, 2017, this duty to inform also applies if the interest rate on a loan is based on the exchange rate.

The instant case concerned a loan in the amount of approximately 3 million euros that had been taken out by a municipality in North Rhine-Westphalia. The interest rate for the first 20 years was supposed to be 3.99 per cent p.a. assuming an exchange rate from euros to Swiss francs equal to or greater than 1.43. In the event of the euro falling below this threshold, the interest rate would then be 3.99 per cent plus half of the change in the exchange rate from 1.43. During the consultation, the bank pointed out that the Swiss National Bank, Switzerland“s central bank, would adopt a zero interest rate policy in the event of the Swiss franc appreciating and that their threshold for intervention was 1 euro to 1.45 Swiss francs. Additionally, there was a table showing the respective interest rate for exchange rates ranging from 1.39 to 1.65. From a rate of 1.42 to 1.39, the interest rate increased incrementally from 4.34 to 5.43.

In the end, the franc appreciated so strongly that the municipality was supposed to pay an interest rate of 18.99 per cent p.a. It therefore considered the loan agreement to be unjust and void. Moreover, it claimed that the foreign exchange risk had not been properly explained. Despite the municipality“s claim being unsuccessful before the first two courts of instance, the BGH reached a different conclusion.

Although the loan agreement was not found to be unjust, the bank had failed to fulfil its duty to inform. While the dependent relationship between the interest rate and the exchange rate was said to be apparent from examining the agreement, the bank had not explained with sufficient clarity the risks associated with an obligation to make interest payments based on an exchange rate, but instead downplayed these. The court of appeal must now rule on the case anew.

When it comes to problems concerning loan agreements, lawyers who are experienced in the field of banking law can serve as competent advisors.

https://www.grprainer.com/en/legal-advice/banking-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

LAG Hamm: Fixed-term employment contract due to extra work must be properly justified

LAG Hamm: Fixed-term employment contract due to extra work must be properly justified

LAG Hamm: Fixed-term employment contract due to extra work must be properly justified

A temporary need for manpower can constitute an objective reason justifying a fixed-term employment contract, but this temporary need has to be properly justified.

It is even possible to have several consecutive fixed-term employment contracts if there is an objective reason justifying this. One example of an objective reason justifying a fixed term is if the employer only has a temporary need for extra manpower. Having said that, the employer has to properly make the case that this need is only temporary. We at the commercial law firm GRP Rainer Rechtsanwälte note that it must be possible to anticipate with sufficient certainty that there will be no further need for the extra manpower in question once the contract governing the temporary employment relationship has come to an end. A ruling of the Landesarbeitsgericht (LAG) Hamm [Regional Labour Court of Hamm] from July 6, 2017 shows that a fixed term may be invalid in the absence of this kind of prognosis (Az.: 17 Sa 172/17).

In the instant case, a university had concluded a fixed-term employment contract with an employee for a period of around two years due to an increased amount of student counselling work resulting from double the number of school leavers, with this increased workload not expected to continue after the expiry of the contract. The relevant employee assumed responsibility for other tasks in addition to student counselling, particularly in relation to study coordination.

She later applied to have her employment contract extended for an indefinite period of time, which the university rejected. She subsequently lodged a claim shortly before the fixed-term employment contract expired requesting that it be found that her employment relationship would not come to an end on account of the fixed term. The competent labour court ruled in her favour, and the claim was also successful before the LAG Hamm.

The LAG held that a fixed term in response to a temporary need for manpower presupposes that it be expected with sufficient certainty at the time of the contract“s conclusion that there will be no permanent need for this extra manpower after the contract has expired. The employer must present a prognosis to this end supported by concrete evidence. The Court found that this prognosis represents a component of the objective reason justifying the fixed term. On the other hand, it ruled that general uncertainty regarding a possible future job opportunity does not justify applying a fixed term. The university was found to have failed to demonstrate this, particularly as the employee had taken on other responsibilities as well.

All employment contracts, and not simply those with a fixed term, should always be prepared thoroughly and in detail. Employers can turn to lawyers who are experienced in the field of employment law.

https://www.grprainer.com/en/legal-advice/employment-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

BAG: Employer not liable for harm caused by vaccine

BAG: Employer not liable for harm caused by vaccine

BAG: Employer not liable for harm caused by vaccine

Employers who have flu vaccines administered within their company are not liable for any harm that might occur as a result of the vaccine. That was the verdict of the Bundesarbeitsgericht (BAG), Germany“s Federal Labour Court, in a recent ruling.

During the winter, a lot of people get vaccinated against the flu. Of course, employers also have an interest in flu vaccination as a means of preventing an epidemic within their respective firms, which is why many employers offer employees the option of receiving workplace flu vaccinations. The workers are then able to decide for themselves whether or not they wish to accept this offer. We at the commercial law firm GRP Rainer Rechtsanwälte note that this is why said employers are not liable for any harm caused by the vaccine. This comes from a judgment of the Bundesarbeitsgericht from December 21, 2017 (Az.: 8 AZR 853/16).

In the instant case, a freelance company doctor had called for the employees of a cardiac center to receive flu vaccinations on clinic premises. The employer bore the costs associated with the vaccinations. One employee who responded to this call was an administrative member of staff who had no contact with the patients. She subsequently experienced various lasting impairments relating to her cervical spine, for which she blamed the vaccine. She claimed that while the vaccine had been correctly administered, she had not been properly informed about the risks associated with the flu vaccine. She went on to say that had she been properly informed, she would not have had the vaccine administered. She therefore raised an action for damages for pain and suffering on account of a failure to fulfil the relevant obligation to inform. However, the action was not directed at the doctor but rather the employer.

Like the courts of lower instance before it, the BAG dismissed the claim. It held that no treatment contract had come into existence between the employer and the plaintiff that would have given rise to a duty to inform on the part of the employer. The BAG also found that the existing employment relationship did not give rise to a duty to inform, noting that a treatment contract had only come into existence with the doctor.

When it comes to issues pertaining to the workplace, lawyers who are experienced in the field of employment law can offer advice.

https://www.grprainer.com/en/legal-advice/employment-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

BAG: Threats made by employee can justify dismissal with immediate effect

BAG: Threats made by employee can justify dismissal with immediate effect

BAG: Threats made by employee can justify dismissal with immediate effect

Employers do not have to accept threats made by employees. These can constitute good cause justifying extraordinary notice of dismissal with immediate effect, as demonstrated by a ruling of the Bundesarbeitsgericht (BAG), Germany“s Federal Labour Court.

An employer can issue extraordinary notice terminating an employment contract with immediate effect if there is good cause rendering it unreasonable to continue the employment relationship. We at the commercial law firm GRP Rainer Rechtsanwälte note that one such example of good cause is a serious threat made by an employee. In its judgment of June 29, 2017, the Bundesarbeitsgericht found in this regard that a serious and freely made threat constitutes good cause justifying extraordinary notice of dismissal if the employee was trying to exert pressure on his or her employer in order to advance his or her own interests (Az.: 2 AZR 47/16).

In the instant case, the worker in question was employed as a road mender for one of Germany“s federal states. After falling ill multiple times and receiving in-patient psychosomatic treatment, he was laid off for being unfit to work as a road mender and ultimately treated in the same manner as a severely disabled person. During the course of the company“s reintegration program, the employee made statements that were perceived by the other participants in the discussion as threats to commit suicide or go on a shooting spree. In addition, the employee did not rule out the possibility of more sick leave, and he failed to distance himself from these remarks throughout the rest of the discussion. The employer subsequently issued the man with exceptional notice of dismissal with immediate effect.

His action for wrongful dismissal was unsuccessful. The BAG held that merely announcing future bouts of illness may be enough to justify dismissal with immediate effect if this indicates a readiness on the part of the employee to abuse his rights. The Court went on to say that the threats to commit suicide or go on a shooting spree could also justify dismissal with immediate effect, as this puts enormous pressure on the employer. The same was said to be true if the aim of the threats was to advance the employee“s own interests. The BAG noted that this kind of intention could even heighten the significance of the threat.

Whether in the final analysis the threats were made in earnest now needs to be re-examined by the Landesarbeitsgericht, i.e. the regional labour court. A threat was said to be serious if it is likely that a person with normal sensitivities would perceive it as such. The BAG ruled that whether the person who made the threats is able to or wants to make good on his statements is irrelevant.

https://www.grprainer.com/en/legal-advice/employment-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

GRP Rainer Rechtsanwälte – New additions to commercial and company law team

GRP Rainer Rechtsanwälte – New additions to commercial and company law team

GRP Rainer Rechtsanwälte - New additions to commercial and company law team

We at the international commercial law firm GRP Rainer Rechtsanwälte have bolstered our team in order to make further improvements to the high-quality advice we provide to our growing clientele.

The trajectory at GRP Rainer Rechtsanwälte continues to be one of growth. Our commercial law firm“s objective is to closely collaborate with our clients both at home and abroad to provide interdisciplinary and comprehensive solutions. To meet our own high standards as well as, of course, the expectations of our clients and offer even better advisory services, attorneys Dr. Florian Wirkes and Dr. Hilmar Müller will now be joining our team of experienced lawyers. With these two new additions to our team, the range and depth of GRP Rainer Rechtsanwälte“s expertise continues to grow and puts us in a position to provide performance-based solutions even in the face of the most complex of demands.

Dr. Florian Wirkes, LL.M, first studied law at the Universität zu Köln in Cologne and later worked for, among others, a law firm in Bangkok. Following his traineeship, he went on to obtain a Masters in Wirtschaftsrecht (LL.M.), i.e. commercial law, from the Universität zu Köln, completed his doctorate in 2017 while working and has since joined GRP Rainer Rechtsanwälte.

Dr. Hilmar Müller studied law at the Universität zu Potsdam with a focus on commercial and company law. He completed his doctorate in the field of stock corporation law before working within the framework of his traineeship for, among others, a law firm in London. His main areas of practice were in the field of company law, in particular mergers and acquisitions (M&A) as well as commercial law in general.

Now with Dr. Florian Wirkes and Dr. Hilmar Müller on board, GRP Rainer Rechtsanwälte has once again expanded upon its extensive expertise in the areas of commercial, trade and company law. From our offices in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich Stuttgart, London and Singapore, we provide our clientele with excellent interdisciplinary legal advice and develop comprehensive solutions. In doing so, we continue on our path to become a consistently client-oriented service provider and competent consultant for national and international businesses, companies, institutional investors as well as private individuals.

https://www.grprainer.com/en

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en

Politics Law Society

Prohibition of competition – BGH bolsters commercial agents“ rights

Prohibition of competition – BGH bolsters commercial agents“ rights

Prohibition of competition - BGH bolsters commercial agents" rights

Commercial agency agreements often include a prohibition of competition, also known as a no-competition clause. Notwithstanding this, certain clauses in the general terms and conditions may be invalid, as is clear from a ruling of the Bundesgerichtshof (BGH), Germany“s Federal Supreme Court (Az.: VII ZR 100/15).

Companies frequently arrange a post-contractual prohibition of competition with their commercial agents, whereby the commercial agent commits not to entice any clients away from the company over a specified period of time after the agreement has been terminated. However, we at the commercial law firm GRP Rainer Rechtsanwälte note that these kinds of clauses in the general terms and conditions may be invalid if they“re not drafted in a sufficiently transparent manner. That was the verdict of the BGH.

In the instant case, the commercial agent had served as a financial advisor to a company. In September of 2011, the contractual relationship was brought to an end. It had been contractually agreed in the general terms and conditions that the financial advisor would not lure clients away from the company or attempt to do so for a period of two years following termination of the commercial agency relationship.

The company took the view that the financial advisor had violated this agreement, arguing that the latter had induced four clients to change or terminate their contracts during the term of the post-contractual prohibition of competition, or at least attempted to do so. The company raising the legal action therefore asserted claims against the financial advisor, but the action was unsuccessful even before the BGH.

The Karlsruhe judges held that the post-contractual prohibition of competition in the general terms and conditions had not been effectively agreed. The clause „Vermögensberater verpflichtet sich, es für die Dauer von zwei Jahren nach Beendigung des Handelsvertreterverhältnisses zu unterlassen, der Gesellschaft Kunden abzuwerben oder dies auch nur zu versuchen“ (the commercial agent commits not to entice clients away from the company or even to attempt to do so for a period of two years following termination of the commercial agency agreement) was said to constitute a violation of the requirement for transparency and was thus invalid.

The Court held that the post-contractual prohibition of competition unquestionably represented one of the company“s general terms and conditions. The clause was said to violate the requirement for transparency because it failed to make sufficiently clear whether the prohibition of competition extended only to parties who were clients during the term of the agreement or whether it also covered parties who only became clients after the commercial agency agreement had been terminated. The Court therefore ruled that the scope of the prohibition of competition was unclear to the agent. As such, the BGH went on to conclude that it did not even need to be established whether the prohibition of competition was invalid due to the lack of a specific arrangements for parent leave compensation.

Lawyers who are experienced in the field of commercial law can advise companies and commercial agents alike.

https://www.grprainer.com/en/legal-advice/commercial-law/commercial-agency-law.html

GRP Rainer LLP www.grprainer.com/en/ is an international firm of lawyers and tax advisors who are specialists in commercial law. The firm counsels commercial and industrial companies and corporations, as well as associations, small- and mid-sized businesses, self-employed freelancers and private individuals worldwide from offices Cologne, Berlin, Bonn, Dusseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London UK.

Contact
GRP Rainer LLP
Michael Rainer
Augustinerstraße 10
50667 Cologne
Phone: +49 221-27 22 75-0
Fax: +49 221-27 22 75-24
E-Mail: info@grprainer.com
Url: http://www.grprainer.com/en