Ofgem’s recently announced goals and developments and changes to the post-Brexit state aid regime will have important implications for market players.

By John D Colahan, Stephanie Adams, and Anuj Ghai

2020 is set to be a an important year for competition law-related enforcement in the UK energy sector not least as it waits for the final contours including any material changes post Brexit. We explore in this post two areas that we consider to be of particular importance:

  • The implementation of Ofgem’s goals flagged in its 2019 Energy Market Report
  • The implications for the energy sector of post-Brexit state aid enforcement in the UK

Cross-border migration of German real estate companies is generally possible, however its admissibility must be determined on a case-by-case basis.

By Christian Thiele

International real estate investors continue to favour German real estate, however, the same does not always apply to German real estate companies. International real estate investors, for instance, often find German capital maintenance rules too strict because such rules, inter alia, complicate the withdrawal of liquidity and the cross-collateralization of financing taken out by other portfolio companies. In addition, real estate companies that are permanently established in Germany may be subject to German trade tax, which hinders many business plans. Some international real estate investors who invest through the Netherlands or Luxembourg prefer, for convenience purposes, entities established under those legal systems. Therefore, investors consistently question whether a cross-border migration of German real estate companies is possible. In this context, real estate investors must distinguish between a mere transfer of the administrative seat, i.e., the place where the essential day-to-day decisions are made, and a transfer of the company’s statutory seat, i.e., a conversion of a German company into a foreign company.

Cross-border merger

German law does not provide specific rules for cross-border migration. Pursuant to sections 122a seqq. of the German Transformation Act, merging a German entity into another entity established under the laws of an EU Member State is possible. However, as a cross-border merger usually cannot be implemented without triggering real estate transfer tax, this procedure is usually not relevant in practice.