Wed, Dec. 24, 2003

Relaxed Employment and Termination Rules Effective Soon

CK - Washington.   Relaxed rules will become effective very soon, Simon's Blawg notes. The Stuttgart Chamber of Commerce provides a useful summary in German.

Companies not older than four years may now conclude temporary employment agreements, for up to four years. The rules on the termination of employees are substantially clearer: There are fixed severance structures for terminated employees who waive their right to challenge a termination in court. In addition, workable criteria apply to the selection of employees for termination based on business developments, and the standard of judicial review of adherence to the criteria is no longer simple negligence. While employees may generally not be required to work more than an average of 48 hours per week over a six month term, new collective bargaining agreements may deviate from this standard.

The effective date of the new employment rules is January 1, 2003. Internationally, they should make the work force in Germany more competitive. The special rules for new ventures should enable international businesses to test the German market for a good number of years without incurring the previously substantial penalties for terminating employees when leaving the market. The severance criteria render the costs of an engagement in Germany greaty more predictable.

Sat, Dec. 20, 2003

Laptop in Jail

CK - Washington.   A Christmas present is what a German law blog calls a ruling by the German Supreme Court BGH: Lawyers may now bring laptops into jail for client conferences as long as the laptop is not stuffed with a network card or other accessories. The order, dated December 15, 2003, occurred in the course of an investigation against a certain I.G., case numbers 2 BGs 315/2003, 2 BJs 11/03-5, involving a terrorist conspiracy.

Mon, Dec. 15, 2003

Termination of Employment Easier

CK - Washington.   The Federal Employment Court in Kassel, the highest German court responsible for industrial relations, recently decided that theft and conversion by an employee of property owned by the employer constitute cause for immediate termination. In another development, the planned tax reduction statute has caused the government to a concession in the area of employment law.

The new employment rules exempt employers with less than 10 employees from the strictest forms of employee protection against the termination of employment contracts. Currently, the exemption covers very small employers with up to five employees. Ten is a more reasonable number in the international experience where a startup should be able to ascertain its future before reaching the new limit.

The BAG decision 2 AZR 36/03 of December 11, 2003, published by Beck, is important because theft and conversion by themselves were not always deemed to constitute cause for termination. Employers were often unable to fire personnel on such grounds. Of particular significance is the court's holding that such conduct constitute cause not only among other factors. In other words, theft and conversion by themselves will constitute cause. The court clarified that other factors may be essential in terms of procedure and timing of the termination, but "other factors" are not to be interpretated as qualifiers of the cause.

Sun, Dec. 14, 2003

New Justices at German Supreme Court

CK - Washington.   Four judges were appointed to the following divisions of the Federal Supreme Court in Karlsruhe:

  • Gabriele Caliebe: II. Civil, chiefly corporate law
  • Jürgen Cieniak: IX. Civil, bankruptcy, enforcement, attorney and tax advisor liability law
  • Dr. Ulrich Herrmann: III. Civil, sovereign and public liability law
  • Hans-Joachim Dose: XII. Civil, family and commercial tenancy law

    The appointments were announced on December 11, 2003. The court known as the BGH is one of several federal supreme fora spread over several cities in the federation. The one in Karlsruhe is generally deemed the most important and is charged with civil and criminal matters. Other supreme courts exist, for instance, for administrative law, employment relations, and tax law. The ultimate supreme court in Germany is the constitutional court, also located in Karlsruhe, the capital of the law in Germany.

  • Sat, Dec. 13, 2003

    Bar Admission Criteria Reviewed

    SW - Washington.   The German Supreme Court (Bundesgerichtshof/BGH) recently clarified the requirements for the admission to the German bar. The court held that a German national residing in the United Kingdom who passed the First but not the Second Legal State Exam in Germany and who is admitted to the practice of law in New York, after addional U.S. law studies, could neither gain admission to the practice of law in Germany nor enjoy the privileges of an established European lawyer. Such a lawyer may, however, practice in Germany using the foreign title; this practice may include the laws of the country that conferred the degree and granted the bar admission as well as a focus on international law.

    The decision resolves a controversy between a German national and regional bar administrators. The plaintiff, the German national, had passed the first, but not the second comprehensive state exam in Germany. In addition, he gained admission to the New York bar after attending a U.S. law school. When the dispute arose, he resided in London and had not been admitted there as a barrister, solicitor or advocate. He applied for admission to the German bar which rejected the application, resulting in this lawsuit.

    The BGH confirmed the rejection because he qualified neither under BRAO (Bundesrechtsanwaltsordnung), the rules governing the admission to practice law based on the standard legal education in Germany, nor under EuRAG (Europäisches Rechtsanwaltsgesetz), the European Union rules controlling the practice of European attorneys in Germany, as follows:

    (1) The plaintiff did not qualify for admission under § 4 BRAO which requires the Referendar and Assessor degrees because he completed only part of the standard education.

    (2) He failed to meet the alternative requirements of sections 11 Abs.1 S.1 EuRAG. While a candidate who establishes an actual and systematic practice as a European attorney in Germany for three consecutive years covering German and European law will be admitted as an attorney in Germany, the plaintiff did not prove such a practice.

    (3) Candidates qualified for the European attorney practice may be admitted under § 16 Abs.1 EuRAG after passing an exam to evaluate the fitness for the practice of German law. The plaintiff's petition failed that test.

    As applied to the instant facts, the court concluded that his admission was lawfully denied. The ruling is important because it clarifies that German nationals may not circumvent the standards for a qualifying legal education in Germany by seeking admission abroad. Whether it will control in the long term remains to be seen. Currently, the two-step system of legal education underlying the ruling is under review and a reform may follow.

    Fri, Dec. 05, 2003

    Supreme Court Disallows Foreclosure into Diplomatic Real Estate

    JN - Recklinghausen.   Real estate owned by a foreign sovereign and used solely for diplomatic purposes enjoys protection under German law. In a recent decision (BGHR 03, 1041), the German Supreme Court in Civil Matters (Bundesgerichtshof - BGH) prevented such property from going into foreclosure. The question whether such real estate is governed by German law or not is a matter of international law, according to Art. 25 Grundgesetz (Constitution - GG) and 20 Abs. 2 Gerichtsverfassungsgesetz (Constitution of the Courts - GVG). Under the principles of international law adapted into German law, it is not generally undue that a foreign sovereign's property may become subject foreclosure, as the German Constitutional Court (Bundesverfassungsgericht - BVerfG) stated in the matters BVerfGE 46, 342, 388, 392; 64, 1, 23, 40. But there is an international principle according to which property situated in Germany may not be executed into without the express consent of the foreign state, provided the property is being used chiefly for political or diplomatic purposes.

    Because of the obvious difficulties in determining the property's main purpose, international law requires the broad application of this rule. Therefore, any property used for consular or diplomatic missions is inviolable. This includes an embassy's real estate (Art. 22 ff. of the Vienna Convention on Diplomatic Relations; Art. 31 of the Vienna Convention on Consular Relations), the court confirmed.

    Fri, Nov. 28, 2003

    Prosecuting Barbarism and Discrimination

    CK - Washington.   Various NS and discriminatory logos, songs, expressions and other material can trigger criminal prosecution in Germany. In an attempt to clarify the sanctioned items and expressions, a state government agency has published a list. Under the federal constitution of the United States, nearly all of the material listed here would benefit from freedom of expression principles. Unlike the United States which has not comprehensively addressed past and present discriminatory behaviour or the extermination of segments of its population in a criminal context and has limited sanctions primarily to acts defacing or deriding national symbols, Germany and other European nations have moved toward the other extreme of criminally prosecuting the glorification of barbaric or discriminatory systems, attitudes and their symbols.

    Thu, Nov. 27, 2003

    Transatlantic Denial of Service Attacks

    CK - Washington.   An American software product that forms a valuable line of defense against hackers is the reported cause of an unintended denial of service attack in Germany. A Zonelabs auto-update appears to have caused massive damage to ISPs in Germany after it failed to acknowledge a missing DNS server, assumed against more cautious internet design practices the existence of a properly set DNS router and kept pinging by the millions servers for a non-existing or unavailable address.

    Similar incidents, also some involving German software used in the United States, caused distress among network administrators when software buggily pinged servers at high rates or its designers failed to realize that users might modify the software so that it could accidentally or maliciously ping certain targets in a harmful manner. In some cases, demands from were made on the software makers for vast amounts of damages.

    Perhaps there is a need to absolve protective software from product liability claims in the same manner that government procurement rules exempt government-specified products from such claims or Homeland Security exemptions cover goods for the defense against terrorism.

    Fri, Nov. 21, 2003

    Second Bavarian IT-Day

    ZY - Washington.   The Second Bavarian IT Day focused on contracts on the internet under §312 b of the German Civil Code, the new Value-Added Service statute as a response to abuse by so-called dialer software and sniper software, an overview of the amended German Copyright Act, and the new supplemental terms of contracts for securing services from private IT companies. Stephan Meyer provides an English conference report.

    Sun, Nov. 16, 2003

    In Memoriam German American Counsel von Conrad

    FS - Washington.   Transatlantic attorney Gunter von Conrad of Washington, DC died suddenly during a recent visit to Germany, as Hauptstadt::Washington reports. A memorial service arranged by the German Lutheran Church will be held at Pilgrim Lutheran Church in Bethesda, on December 13, 2003.

    Sat, Nov. 01, 2003

    German Statutes in English

    CK - Washington.   A list German statutes in English translations is at the Carob translation service's website. TransBlawg's blogger and master translator for German-English text recommends the site. With two translation experts endorsing the material, these resouces would appear to be reliable for many purposes.

    Wed, Oct. 29, 2003

    Court Rules on Perfecting NS-Restitution Claims

    WM - Schongau.   According to the highest German court for administrative law, the Conference on Jewish Material Claims against Germany (JCC) must meet certain requirements in order to effectively register restitution claims under the restitution law covering East German property, the Vermögensgesetz.

    This statute grants restitution to victims who suffered financial losses due to acts of nazi-terror within the borders of the former GDR and the Soviet sector of Berlin. Under the Vermögensgesetz, the JCC may claim restitution for deceased Jewish beneficiaries and their successors, who failed to file claims, thereby claiming the restitution of expropriated real property. In order to meet the statutory registration deadline of December 31st, 1992, the organization first made a global registration of claims for any and all properties.

    The court held, however, that claims must identify expropriated real property, its value and former owner(s) by referring to files and documents of authorities, archives, institutions or companies made accessible after the collapse of the GDR. Therefore, the court turned down the request for a global registration of claims. It upheld a subsequent filing that that met the statutory burden, see BVerwG 7 C 62.02 and 8.03, Oct 23, 2003).

    Wed, Oct. 08, 2003

    Kaplan Case: Is Germany Able to Deal with Radical Asylum Seekers?

    JN - Recklinghausen.   Germany makes another attempt to get rid of the self-proclaimed "Kalif of Cologne". Up to now, Turkish radical Islamist leader Metin Kaplan, convicted on appeal for murder and released from prison after having served a four year sentence, has successfully challenged every attempt by German officials to expel him. Although his immigration status as a legal asylum-seeker has been revoked, German courts continue to prevent Kaplan's deportation.

    As the Cologne Administrative Court Cologne now held, a deportation is unlawful if there is evidence that the deportee might suffer torture or could be subject to a procedure violating the rule of law in his home country. Despite Turkey's latest efforts at complying with human rights, the court disallowed Kaplan's deportation because of the probabalities of future violations. It found sufficient evidence that Kaplan might be criminally convicted on the basis of statements made under torture.

    The case attracts attention in German media because it highlights Germany's inability to deal with asylum seekers who are convicted criminals. German Secretary of the Interior, Otto Schily, even travelled to Turkey to secure official guarantees that Kaplan would enjoy a fair trial. In Turkey, Kaplan is accused of subversive activities. As he frequently stated in his radical speeches, his organization hopes to convert Turkey into a state exclusivley governed by the rules of Islam. After Schily's return from Turkey, his department challenged the case before the Court of Appeals of Münster. The court confirmed that the case, which is said to put the efficacy of German asylum law to the acid test, will be handled speedily and without delay.

    Tue, Oct. 07, 2003

    ECJ: Direct Applicability of WTO Rules in EU Law

    ZY - Washington.   In a surprising development, the European Court of Justice opened the door to legal recourse for business harmed by the European Union's failure to complate with a World Trade Organization mandate. A few days ago, the court found that the direct applicability of WTO rules in EU law may allow new remedies for damages suffered by its citizens for violations by the EU bodies. A new analysis by Werner Berg of Gleiss Lutz explains how the new rulings constitute a potential third prong for a direct WTO effect in EU law.

    By imposing an EU import embargo of hormone-treated cattle and beef from non-EU-Member States, the EU infringed upon several provisions of the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement). Later, the EU failed to comply with a WTO ruling ordering the EU to terminate the embargo. Traders suffered damages as a result of the embargo. The ECJ dismissed the current cases seeking their redress of grievances but announced the above trend which is favorable for its citizens injured by the EU's failure to comply.

    Dr. Berg, the author of the analysis, is a trade expert who advises international businesses in transatlantic trade disputes, including the Banana War, and the upcoming threats--and preventive planning--from E.U. sanctions for the U.S. tax rebate program held illegal under WTO rules, and recently discussed the EU trends with Bloomberg.

    Fri, Oct. 03, 2003

    Theses, Papers Available for Online Order and Free Patent Site

    CK - Washington. offers theses and papers on various subjects, including law, on its online site, as Handakte WebLAWG points out. WebLAWG also praises a German patent law site.

    Sun, Sep. 14, 2003

    Transblawg on Remedies and Jurisdiction

    CK - Washington.   Transblawg publisher Margaret Marks discusses the difficulty many German speakers without US legal training have with the English terms remedies and jurisdiction. Her elucidating analysis is especially useful because it is not limited to the proper terms but also addresses the frequently-found mistakes. The examples extend in their validity beyond the UK jurisdctions to those of the United States.

    Sun, Aug. 31, 2003

    Sports Glory to Adorn Sports Counsel Brzank

    CK - Washington.   The German Supreme Court in Karlsruhe decided in the matter BVerfG, 1 BvR 2108/02, on August 4, 2003 that attorneys with major credits in active sports may advertise their sports accomplishments in their specialized practice.

    Ines Brzank, a former member of the former East German national team and now a sports counsel in private practice, advertised this fact in a brochure. Competing attorney Kay Achtelik found that to constitute a violation of professional ethics but the Supreme Court sided with her.

    The court pointed to Art. 12 (1) of the constitution which permits professionals to publish factual, non-misleading information which demonstrates the professional's life experience even if unrelated to the practice of law. The court went beyond the mere acknowledgement that the constitional rights of the professional may be impermissibly violated by unreasonable restrictions. The court also expressed the view that unrelated information may be an important service to the potential customer or client who looks for the comfort that an expert in his field can provide. It referred the case back to the lower court for further factual analysis.

    Thu, Aug. 07, 2003

    German Aspects of Taxation at GALA Capital Area Chapter

    CS, JG - Washington.   Today, Dr. Stephan Seltenreich, Esq., of White &Case, Frankfurt, spoke at the German Amerian Law Association, Capital Area Chapter in Washington, about the newest developments in German tax law. Dr. Seltenreich introduced the changes in the Reorganization Tax Act. In the area of corporate taxation he emphasized shareholder taxation on dividends, capital gains taxation, transfer pricing and group taxation. He illustrated the effects and differences through examples, especially as they relate to resident and foreign shareholders, and by comparing German and American issues in transfer pricing. He concluded with the more recent reform proposal, the reforms for lump sum tax on interest and the upcoming tax amnesty which are now being debated in the German parliament. His presentation led to a lively discussion.

    Fri, Jul. 11, 2003

    German Corporate Governance Code Published

    CK - Washington.   A German government-chartered commission has published its Corporate Governance Code (Deutscher Corporate Governance Kodex). The commission consists of academics and business leaders. The code applies to stock corporations listed on the German stock exchanges. A list of companies that subscribe to the code is published.

    An exemption provision lets companies state that they do not comply with the code. In addition, the code has been drafted with language that enables companies to deviate from the recommended standards. The rationale for such accommodations is that corporations should not be too tightly pressed into definitive structures of governance where industry specific necessities dictate other solutions.

    The commission expects the code to be voluntarily applied by private companies and to review and amend the code annually.

    Petition to Fix MS Windows Browser

    CK - Washington.   An important petition suggests that Microsoft fix its internet browser to properly display PNG images. For instance, the logo above displays a white background in MS's broken windows browser but a transparency in regular browsers. Presumably, without having achieved a near-monopoly in browsers for windows users, MS would have fixed this feature several versions ago as it promised for version 4.

    Mon, Jun. 16, 2003

    Linux Wins "Battle of Munich"

    JN - Washington.   Despite Microsoft's favorable discounts for its operating systems, the Social-Democrat (SPD) controlled Munich city council decided for Linux. It decreed after a heated battle between the Linux and Microsoft camps that all of the 14,000 computers in the Bavarian capital's public administration are to run Linux in the future.

    The cost of conversion is estimated to reach 30 million Euros, according to media reports. This factor evoked resistance by the Christian Democratic Party (CSU) which favors Microsoft's Windows. As Bavaria's majority party on the state level, the CSU forms the opposition in Munich. It announced a review of the decision, arguing that 10 million Euros could be saved by staying with Windows. The city's vote in favor of Linux was a "waste of tax payer's money", CSU spokesman Robert Brannekämper believes.

    Contracts are to be finalized by early 2004.

    Sat, Jun. 07, 2003

    Reverse Software Engineering in IEEE Amicus Brief

    CK - Washington.   IEEE-USA filed an amicus curiae brief with the U.S. Supreme Court to defend reverse engineering of software on cert of Bowers v. Baystate Technologies, Inc., 320 F.3d 1317 (Fed. Cir. 2003) from the U.S. Court of Appeals of the Federal Circuit in Washington, DC. Among several arguments supporting the supremacy of federal intellectual property law, the IEEE argues that the recent Bowers decision effectively rewards creativity in crafting license agreements at the expense of the essential tenets of copyright law.

    Reverse engineering issues meet at the junction of federal copyright and other intellectual property law and the laws of the states and the District of Columbia, including their contract laws pertaining to sales and licenses.

    In Bowers, a key is the restriction frequently embodied in shrink-wrap and click-on licenses to forego users' rights to reverse engineer a product. The Federal Circuit's holding can be understood to prohibit even learning by operating software so protected.

    Germany permits reverse engineering under the 1991 E.U. Software Directive (Council Directive 91/250 on the legal protection of computer programs (OJ 1991 L122/42)) -- discussed with reference to U.S. law here -- which has found some support also in the U.S. software business community.
    (Disclaimer in Comments)

    New Link: is the new quick URL to get here.

    Thu, May. 29, 2003

    Ben Flowe on Iraq Sanctions Liberalization

    If you are touched by export controls, you know of Benjamin Flowe, or you should. Ben has just released an update on the Iraq sanctions and their liberalization. Topics include: AES Will Be Mandatory, with Certification to File Export Documents; Microprocessor Liberalization with NLR Military End-Use Controls; Current Export Legislation; Bush Administration Defense Trade Review; Enforcement Cases; CCL and Other Changes. The thrust of his arguments is:

    First, U.S. forces liberalized the people of Iraq, then the benefits should flow. One clear change is the liberalization of long time economic sanctions and export controls. Ben's new Export Licensing Clients Memorandum describes (1) the current state of liberalization of export controls on Iraq (with more to follow in about a week), plus the following major export control and sanctions changes: (2) increased penalties for false statements on SEDs, mandatory electronic submission of export documents via AES, and upcoming certification requirement for same; (3) liberalization of controls on general purpose microprocessors with unprecedented military end-use/r restrictions on NLR shipments; (4) EAA, Sudan, and Syria legislation; (5) implementation of State-BIS settlement on "space-qualified" items; (6) Bush Administration review of defense trade policy; (7) ITAR USML Review; (8) revisions to ITAR Canadian Exemption; (9) State proliferation sanctions; (10) significant enforcement cases; (11) changes to Unverified List and Best Practices for Transshipments; (12) Commerce Control List revisions for Wassenaar, Missile Technology, Nuclear, and other reasons; (13) effect of General Accounting Office reports on current and future policy; and (14) OFAC unblocking of most assets frozen under the Federal Republic of Yugoslavia Sanctions Programs.

    Request your copy from Ben at 202 293 5555.

    Wed, May. 21, 2003

    Microsoft v. Linux do Battle in Munich

    JN - Washington.   The Munich city council, already on its way to fame as the first municipality in Germany to exclusively use Linux, has been offered a 15% discount by Microsoft on its products. The reigning Social Democrats now favor Windows.

    The sudden change of mind followed a personal visit by Microsoft CEO Steve Ballmer to the Bavarian capital who convinced the council to use Microsoft's products. The discount and the fact that Microsoft's German subsidiary is a big employer in the Munich area apparently wiped out doubts about frequently reported Windows security leaks.

    Ballmer's effort illustrates the global "Trustworthy Computing" campaign, as Microsoft strives to polish its public image and prevent Linux from gaining market share.

    A municipal ruling is expected some time after May 28 when a deadline for a revised Linux quote expires.

    Tue, May. 20, 2003

    German Supreme Court on Sports Law

    JN - Washington.   The German Federal Supreme Court (Bundesgerichtshof in Zivilsachen, case no. VI ZR 321/02) ruled on April 1, 2003 that a contestant in a car race may not seek damages from another participant for an injury sustained in the race.

    With that ruling, the Court followed an earlier decision in a soccer case, where one player had sued another player for injuries suffered as a result of the other's foul play. The court held that all soccer players know the likelihood of injuries even without infraction of any rules. Therefore, claiming damages was a contradictory action, the Court said, because the plaintiff could have found himself in the same situation as the defendant.

    In the new case, the Court extends this logic to all potentially dangerous physical sports where injuries or damages are likely to occur by accident without the violation of rules.

    Mon, May. 12, 2003

    DAJV Releases New Guide

    DAJV, the German American Law Association has released its new edition of USA-Bewerbungsführer für Juristen. The second editon, completely revised, contains "Informationen für eine erfolgreiche Bewerbung in den USA". The price for members is Euro 6.00 and for non-members Euro 9.00.

    Fri, May. 02, 2003

    Religions as Legal Issues

    Marburg Journal of Religion carries an article by Stephen A. Kent of the University of Alberta on "The French and German versus American Debate over 'New Religions', Scientology, and Human Rights. Not a legal issue?
    It seems to have become a big deal with efforts to define religions. And some American organization are raising hell over such German efforts. There is even a drive to sponsor opposing comments to German politicians which arrived in mail boxes around May 1. An overview of German rules on religion is here -- no idea whose bias, if any, is portrayed.

    Wed, Apr. 30, 2003

    AOLs of the World Unite to Fight Spam and Music Labels Shovel out More

    Within the past few days, the major US internet providers, among them AOL and monopolist Microsoft, joined to fight spam, the unwanted commercial email or UCE.
    Now comes RIAA, representing music marketers, from a fresh court loss against peer-to-peer network providers, and decides to generate huge numbers of notices to users of P2P networks, asking them to stop piracy of commercial music of RIAA members.
    Ironically, RIAA appears to use data gathered from the networks and the infrastructure of the networks to disseminate its own version of UCE; or should that read "ab-use"?
    Read Sabine Roettger's article about the California case and look up today's papers about RIAA's action and the reaction of defenders of privacy. Expect more on the legal issues involving RIAA soon, everywhere.

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