While in May it seemd that the corona-related crash of the German economy had already bottomed out (cf. here), the data for June 2020 even shows the first signs of a possible rebound. But, hey, let’s look into the German economy in some more detail:
Corporate finance: promissory note loans
In my loose sequence on possibilities of corporate financing, after Sale and Lease Back (here), this time I will turn to the so-called Schuldscheindarlehen (promissory note loan), which has resurfaced from oblivion again since the last financial crisis. Particularly in the current corona crisis, some companies are apparently “sucking up” liquidity with the help of this instrument: Bosch, for example, took out loans with a volume of 2 billion euros by June 2020 by placing a promissory note loan (here), and as recently as April 2020, automotive supplier Schaeffler issued promissory notes with a volume of 350 million euros (here).
The German economy in May 2020 – bottomed out yet?
Throughout the last month, the bad news kept indeed (cf. here) constantly flowing in like waves on a beach. Given the easing of the lockdown and the first tentative steps to reopen the economy at the end of May the question is whether the German economy already bottomed out. To get a grip on that, let’s look into the German economy in some more detail:
Here it comes: The Criminal Law for Enterprises
In response to the burgeoning economic crisis following Corona, which is likely to “wash a number of economic crimes to the surface”, the German Federal Ministry of Justice and Consumer Protection (BMJV) published the draft Bill of an “Act to Strengthen Integrity in the Economy” on 22 April 2020 after a coordination process with interested bodies (cf. already here).
The German economy in April 2020 – and the waves roll in…
As foreseen last, month, the Corona-Pandemic has inded cut into the German economy like a hot knife through an ice-cake – and it does not look good. But hey, let’s look into the German economy in some more detail:
The German “COVInsAG” – in practice
After a rather short discussion on the various measures necessary to counter the economic effects of the corona virus pandemic (cf. for further information here (in German)), the legislator enacted a flood of bills on 25 March (“(German) Corona Consequences Mitigation Act”; “Corona-Folgen-Abmilderungsgesetz“). In a brief overview – focussing on the insolvency-specific regulations of the “COVInsAG” contained therein – I will try to evaluate the first experiences with the suspension of the obligation to file for insolvency.
The German economy in March 2020 – in anticipation….
The Corona-Pandemic is cutting through the global economy like a hot knife through an ice-cake – and the German economy is awaiting its „cut“ from the overall cake, so to say (or to stick last months parlour (here): awaiting its piece of sh*** coming back from the fan). But hey, let’s look into the German economy in some more detail:
BGH on “reorganize or leave”
Unless otherwise provided for in the articles of association (e.g. through the redemption of shares), the withdrawal of a shareholder’s status is generally only possible with the consent of the shareholder concerned. Especially in crisis situations, a shareholder could thus develop a blocking potential in order to either prevent a restructuring or to participate in it without any risk of his own. Over the years, however, the German Federal Court of Justice (“Bundesgerichtshof“, “BGH“) has restricted these blockade possibilities by means of differentiated case law. These possibilities could also be useful in the current corona crisis, which is why they will be briefly presented in the following overview.
The German economy in February 2020 – when TSHTF!
So, although with a view to the ongoing meltdown in the global economy it might seem a little odd to look at last months figures, this makes sense – if only to ascertain the status before TSHTF. Since, even before the virus really hit, the German economy remained in a rather fragile state, as the January monthly showed (here). But, hey, let’s look into the German economy in some more detail:
The German economy in January 2020 – before the virus hits
While the last “Monthlies” pointed to a plateauing of the German economy (cf. here and here), the beginning of January marked the point where everybody began to take the threats emanating from the Corona-virus seriously. However, since the economic impact was only starting to gain traction, it is quite interesting to see how the German economy evolved prior to this crucial chain of events. But, hey, let’s look into the German economy in some more detail: