GERMANY Trends and Developments Contributed by: Johanna Wirth, Maximilian Bülau, Philipp Hanfland and Carsten van de Sande, Hengeler Mueller
Hengeler Mueller Bockenheimer Landstraße 24 60323 Frankfurt am Main Germany Tel: +49 69 17095 0 Fax: +49 69 17095 099 Email: media@hengeler.com Web: www.hengeler.com/en/
Germany continues to cement its position as one of the most active dispute resolution venues in Europe, and one of the most innovative. New fields of litiga- tion emerge, case numbers before courts and arbitral tribunals are rising, and the judiciary is struggling to keep up with the demand for dispute resolution. The legislature has recognised the need – and benefit – of innovating the existing frameworks, and has launched numerous initiatives to make dispute resolution in Germany (even) better accessible, more efficient, and more suited to international litigants. Restructuring Litigation The current macroeconomic environment has fuelled a surge in financial restructurings, both domestically and internationally. And an increasing share of com- plex restructurings are being resolved in court. In Germany, this trend is particularly evident under the StaRUG (Stabilisation and Restructuring Framework), a court-supervised restructuring procedure closely modelled on contested civil proceedings, which came into force in 2021. Since its inception, annual case numbers have shown a clear upward trajec- tory. In many StaRUG proceedings to date, outvoted minorities – both creditors and shareholders – have intervened in the court proceedings, and pursued appellate remedies up to and including constitutional complaints. It is expected that German-style restruc- turing litigation will continue to develop into a field of highly contested and complex court proceedings, mir- roring the experience with English restructuring plans and US co-operation agreements. Securities Litigation Many of the largest disputes in terms of value and complexity in the past two decades have originated
in capital markets law. Germany’s legal framework is comparatively claimant-friendly in cases involving breaches of ad hoc disclosure obligations, misstate- ments in offering prospectuses, or deficient financial reporting. Landmark events such as the Wirecard scandal, the Diesel emissions affair, and the Deutsche Telekom IPO litigation have triggered mass proceed- ings with hundreds or thousands of investor claims running into the billions of euros. Securities litigation is expected to gain further rel- evance. Investor claims are frequently catalysed by the enforcement activities of the Federal Financial Supervisory Authority (BaFin), and the BaFin has sig- nificantly expanded its investigative scope over the past years. Since 2024, this has been helped by the deployment of AI-based analytical tools designed to detect potential market abuse. Securities litigation, with large numbers of potential claimants and highly complex factual and economic questions to be resolved, naturally poses problems when it comes to judicially administering the claims. To deal with this complexity, the Model Case Act pro- vides for centralised proceedings where the common legal questions may be litigated before a specialised panel at the Higher Regional Court, while the under- lying proceedings are stayed. In practice, however, KapMuG-proceedings have often turned into protract- ed mega-cases, with proceedings against Deutsche Telekom and Hypo Real Estate lasting 20 and 13 years respectively. A recent restatement of the KapMuG in July 2024 aims to accelerate and simplify model case proceed- ings, and to make them a more effective instrument
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