Changes in the Commercial Code – what do we have to prepare for?

Another amendment to the Commercial Code is in the works. Here is an overview of the most important proposed changes.

Appointment as a statutory representative or member of the supervisory body will require the written consent of the individual concerned. The so-called “piercing the corporate veil” principle is introduced. This means that, under certain circumstances, a parent company can be held liable for the obligations of a subsidiary.

Another proposed change concerns mergers and demergers (“transformations”). Here, several new conditions have to be fulfilled. These are: (i) a successor company cannot have negative equity after the transformation; (ii) a company participating in a transformation cannot be under ongoing winding-up or insolvency proceedings; (iii) a draft of the documents (e.g. merger agreement, demerger project) must be presented to the tax authority in advance for approval.

Transfer of shares in a limited liability company is prohibited if the company’s corporate bodies (managing director, supervisory board) are not registered in the Commercial Register or if its financial statements are not deposited in the collection of deeds. All transfers of shares in a limited liability company are effective on registration in the Commercial Register.

The result of the parliamentary process and voting remains to be seen.

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