False incentives, fraud, debt: the side effects of the corona crisis

The Chancellor is in top form in times of corona crisis. Angela Merkel explains complicated population doubling rates and reproductive numbers. But she also knows everyday things. “They have to be washed or ironed regularly, put in the oven or in the microwave,” Merkel explains how to care for respiratory masks. “Even if that sounds a bit housewife, so to speak.”

The omniscient state – embodied in the chancellor. The subjects are explained life down to the smallest detail. With this self-image, Merkel takes “measures that have never existed in our country before”. Fundamental rights are restricted, the economy is pushed to the brink and then supported with unprecedented aid.

One of Merkel’s closest confidants, Peter Altmaier, is more than enthusiastic. “An uncle who brings something is better than an aunt who plays the piano”, the Federal Minister of Economics remembers of his childhood.

And what is brought along! If you add up everything the federal government now wants to offer to combat the corona crisis, you get a gigantic sum of at least 1.2 trillion euros. No other country in the world has raised so much money in relation to its economic strength.

Germany has a full 35 percent, far more than the EU average or the USA. Federal finance minister Olaf Scholz did not understate what he promised a few weeks ago: “It is not spilled, but padding.”


The increase in importance and power is unique. Never in the history of the Federal Republic has a government intervened so quickly and deeply in public life and thus in the economy. After the financial crisis, German government debt rose by 315 billion euros in one year. The value of the federal, state and local governments will be far exceeded in this crisis. “I am worried whether we will be able to return to normal economic policy,” says Lars Feld, Germany’s top economy.

The measures to protect health are understandable. But the question increasingly arises: what side effects do the multi-billion dollar rescue programs have? The free market is disturbed, competition is distorted, prices lose their signal strength.

“As much market as possible, as much state as necessary”, the famous words of former Federal Minister of Economics Karl Schiller lose their meaning every day.

There is a risk of higher prices, inefficient companies and loss of wealth. It is significant that more and more companies are turning to the Bundeskartellamt during the corona crisis in order to be exempted from cooperating with competitors. The new spirit of state economy speaks.

Spend as much as you can. The year 2020 will be disastrous. Kristalina Georgiewa (IMF chief)

Certainly, help for companies with no fault of their own must be provided. But with the flood of support funds, the risk of misallocation is high. Capital and labor are tied up in companies with below-average productivity, less investment and innovative strength.

A few weeks ago, after a parliamentary request from the FDP for possible support from zombie companies, the Federal Ministry of Finance had to admit that “necessary market processes of creative destruction are hindered”.

The concern is justified that the state is eating itself too deeply into the economy, throwing privacy and data protection partially overboard and that the influence on the market will not be reversed after the end of the crisis.

A look at history suggests little good. The federal government is still 25 years after the IPO Deutsche Telekom still the largest single shareholder.

Fundamentally, there is a problem that is known in the economy as moral hazard: companies and citizens behave irresponsibly or carelessly due to existing false incentives. The news of fraudsters sneaking up subsidies is increasing.

“The state is a lousy entrepreneur”

The appearances of Altmaier and Scholz are characterized by superlatives. At the federal press conference, they will be presenting the rescue packages worth billions to the public with great regularity. “This is the most comprehensive and effective guarantee that there has ever been in a crisis,” said Altmaier in mid-March. “This is the bazooka, we’ll look for small arms later,” the Federal Minister of Finance said at the appearance.

The small arms that have now been added are quite large-caliber. Scholz announced a debt-financed supplementary budget of 156 billion euros. This includes an emergency fund with a volume of 50 billion euros, which is aimed at the self-employed and small businesses with up to ten employees.

The federal guarantee for the state bank KfW is increased by up to 450 billion euros. And then there is an Economic Stabilization Fund (WSF) with a volume of 600 billion euros. The majority is earmarked for government guarantees to keep companies liquid.

100 billion euros are reserved for possible investments, i.e. partial nationalization of companies. The battered Lufthansa is already holding talks about state participation.

You can still hear Altmaier’s words: “The state is a lousy entrepreneur.” The Federal Minister of Economics at least dedicated the most beautiful hall in the ministry to Ludwig Erhard. But he is currently just as far away from Erhard’s mantra as the Germans are from summer leaves in Mallorca.

Minister of Economics Peter Altmaier (standing) and Minister of Finance Olaf Scholz (front)

The father of the “German economic miracle” throbbed to measure, he remembered sentences, the state should not be a player, but an arbitrator in the economy. Now the state is preparing to take over the entire football club.

No other industrial country is helping its economy with such large sums as the Federal Republic. This shows a new evaluation by the International Monetary Fund (IMF). He does not criticize Germany, on the contrary. “Spend as much as you can,” advises IMF chief Kristalina Georgiewa. The economic situation is too depressing.

The Council of Experts is now assuming that the economy will decline by more than 5.5 percent this year. This is the case that was previously treated as a worst-case scenario. The economic downturn would be worse than in the global financial crisis. 725,000 companies have registered financial difficulties and short-time work.

Including: hospitals. Health Minister Jens Spahn ordered them at the beginning of March to postpone all planned operations. For the hospital operator, this means severe revenue losses. More than a third of the intensive care beds are not occupied. With the Hospital Relief Act, the federal government created a regulation to compensate the clinics for the failures. But that’s far from enough.

This is the bazooka, we’ll look at small arms later. Olaf Scholz (Federal Minister of Finance)

Some private organizations have registered short-time work, including the Schön-Klinik group. The head of the German Hospital Society, Gerald Gaß, sees the time for a “careful, gradual resumption of regular care”.

Spahn also said last week that clinics could “gradually return to normal”. “We do not want to keep 40 percent of the intensive care ventilation beds in Germany permanently”, said the minister.

The pressure on the companies is huge, the need for help is great. This year alone, the federal government is raising 156 billion euros in new debt. The federal states are also preparing an extensive flood of money for pumps.

According to a survey by the Handelsblatt newspaper among the 16 state finance ministries, they are currently planning 65 billion euros in new debt to fight the crisis. In addition to the federal government’s huge € 1.2 trillion rescue package, the federal states are also helping their companies and the self-employed. Bavaria alone has launched a fund with 60 billion euros.

The IMF chief not only welcomes the gigantic aid package in Germany, the monetary fund also calls for thorough control. “Keep the bills,” said Georgiewa. Transparency and accountability should not be put off in the face of the crisis. Whether Germany is world champion in this discipline, doubts are increasing.

Risk zombie company

The financial crisis shaped a saying by the former head of central bank in Europe, Mario Draghi: “What ever it takes”. In this crisis, it becomes a “Whatever, take it!” Aid is mostly spent without checking, the money cannot be distributed quickly enough.

According to an overview by the Ministry of Finance and the Ministry of Economics, over 26 billion euros were applied for by KfW Hilfen. Almost 13,000 of the more than 13,200 applications were approved. In other words, almost anyone who wants help gets it, most likely companies that didn’t have a working business model before the pandemic.

This easily creates zombie companies that are only alive because of generous state aid. After all: With the large sums, the KfW steering committee seems to be examining it more closely. So far, around 8.5 billion euros have been approved. So it takes a little longer for the large-volume applications.

In contrast, the self-employed and small businesses with up to ten employees are suspiciously fast. So far, according to the overview of 1.65 million applications, around 1.1 million have been approved and more than nine billion euros paid out. These are not loans, but aid that does not have to be repaid.

“Speed ​​and thoroughness go hand in hand: it is carefully checked who receives the money,” Finance Minister Scholz promised. But is that true? North Rhine-Westphalia and Berlin were even recently forced to suspend immediate payments because large-scale fraudsters wanted to get to the pots.

There are also problems with honest entrepreneurs. In North Rhine-Westphalia, for example, the self-employed and small businesses are always granted the maximum amounts of EUR 9,000 and EUR 15,000 – regardless of need. This practice is not well understood in the Federal Ministry of Economics. Because a flat-rate payment of maximum amounts was actually not intended.

The aid should amount to up to 9,000 euros for companies with up to five employees and up to 15,000 euros for up to ten employees. The emphasis here is on the “up to”. According to the Ministry of Economic Affairs, the actual amount should be based on sales and operating expenses for the next three months. An entrepreneur with zero euros turnover and 1000 euros costs would be entitled to 3000 euros in emergency aid.

But these details were lost somewhere in the confusion between the federal states and the federal states. The up to 50 billion euros are provided by the federal government. Although federal money is at stake, it is up to the federal states how much they scrutinize companies. In Hamburg, for example, a liquidity check is required. Other countries are significantly less strict so that aid can flow as quickly as possible.

In Berlin, more than a billion euros were paid out to solo and small entrepreneurs within days. And the Berlin Senate also admits behind the scenes that surely there are also deadweight effects. Since no examination was carried out, almost everyone received 14,000 euros in a combination of federal and state funds. These include the self-employed, who normally have annual sales that are significantly lower, they say.

Some recipients are now voluntarily repaying the aid for fear of sanctions. But whether a subsequent thorough examination is possible to convince fraudsters is skeptical in financial management.

Dangerous false incentives

The economic nonsense, which is operated partly in the name of Corona, is great. Governments in the federal and state governments are increasingly creating the illusion that they can regulate everything with state trillions. And more and more, government intervention and expansion is creating false incentives in all areas of the economy, which can be revenged bitterly.

Take the housing market as an example: the Federal Minister of Justice, a woman from the SPD, wanted to protect the tenants. The result is a half-baked law that gets small landlords into trouble. The law was so badly made that solvent companies like Adidas or Deichmann used the gaps and simply suspended the rent payments. Only after a storm of indignation did Adidas row back.

Take the example of KfW loans: After the institutes hesitated to pass on the subsidized loans from the Staatsbank KfW to companies because they still had to bear ten percent of the default risk, the state assumed full liability. With the danger that house banks will now be able to provide loans to companies that have long been bankrupt.

The banks don’t care, they are released from any liability, but of course they still make good money from their business. The fool is the taxpayer who has to answer for the defaults.

Example of short-time work: Short-time work allowance is a tried and tested crisis instrument. The state replaces up to 67 percent of net wages. However, the SPD was not enough. In the coalition committee on Wednesday, she pushed for an increase to 80 percent.

It is the most comprehensive and effective guarantee that there has ever been in a crisis. Peter Altmaier (Federal Minister of Economics)

However, a general increase would have significant deadweight effects: Many companies are already increasing short-time benefits from their own resources. Apart from that, the short-time work allowance is not meant to secure the standard of living, but rather to ensure the survival of companies and thus avoid unemployment.

In other areas, the federal corona strategy is rather arbitrary. The craft complained that the vehicle registration offices were closed. There is also much discussion about opening shops up to the limit of 800 square meters. This border was communicated at least improperly and caused confusion and indignation among the shopkeepers.

Now a Hamburg administrative court has declared the 800 square meter rule to be illegal. The court could not understand why opening larger sales areas alone should attract more people to the city center. Necessary infection protection measures could be followed at least as well in larger stores as in smaller facilities.

Whimsical and impractical was initially the requirement that repair shops were allowed to remain open, but the sales rooms had to be closed. Many craftsmen wondered if they could lead the customers through the sales room into the workshop. Another detail from this series of undesirable side effects of the rescue policy.

The border closures, for example with the Czech Republic, mean that the bricklayers are missing in the construction industry and the harvest workers in agriculture from Romania. The state decides a lot, but the consequences are borne by the entrepreneurs and their employees.

The argument for the state’s rapid generosity in the crisis is: rather spend more now to prevent the economy from crashing and millions of jobs be lost than have to finance mass unemployment for a long time. This approach is absolutely correct. But it also remains true: somehow the state rescue billions have to be financed at least in the medium term if the next generations are not to be overwhelmed.

Currently this is done through the use of reserves and debts. Germany certainly has scope. The Federal Republic had just pushed the debt level to below 60 percent, thereby meeting the Maastricht criteria for the first time in many years in 2019. But that will be the last time for a long time.

As a result of the corona crisis, the federal government expects a general government deficit of 7.25 percent of gross domestic product (GDP) this year. The debt ratio as a share of all debts in GDP is estimated at 75.25 percent, as can be seen from the German Stability Program 2020.

“The projection is currently subject to very high levels of uncertainty,” says the current report. In other words, the debt level could be even higher. This mainly depends on how high the losses are that the federal government will incur from its guarantees and sureties.

Given the huge commitments, some in the grand coalition are trying to put the brakes on. “I don’t like the fact that we almost always get new suggestions every hour, what else can you do,” said Union leader Ralph Brinkhaus. “All of this must also be paid for.”

In a crisis, the state’s money is loose. Some sense their chance to finally implement long-held plans.


Dispute over corona protective screen for consumers

Berlin The effects of the corona crisis hit the economy hard. Chancellor Angela Merkel and the state premiers have now agreed on some easing of the measures decided on because of the pandemic. However, it cannot be said with certainty how long customers, tenants and travelers can survive the exceptional situation.

The consumer advice centers are therefore already bringing further help in the event of longer-lasting restrictions. “Then we also need a financial protection screen for consumers,” said the head of the Federal Association of Consumer Protection (vzbv), Klaus Müller, the German Press Agency. In politics, Müller has met with a mixed response: the SPD and the Greens agree, the Union and the FDP clearly reject it.

“I think the demand now made by the top consumer protector Klaus Müller to pay consumers direct subsidies from the state is wrong,” said the consumer policy spokesman for the Union parliamentary group, Jan-Marco Luczak (CDU), the Handelsblatt. “We have differentiated and powerful social security systems that we have adapted to the corona pandemic and designed flexibly so that they can catch people.” The VZBV does not seem to be properly informed here.

Behind Müller’s push is the concern that the restrictions could possibly last even longer. If closings, lost earnings for the self-employed, short-time work or unemployment continued until summer or autumn, the financial budget would have been exhausted for many, said Müller. “Here we should see how the state can support people with financial grants – not just deferrals,” said Müller. Otherwise, many would fall into social benefits like Hartz IV, which were not made for such a crisis.

Luczak said that these days the question is whether steps can be taken to take the positive development of infection rates into account in order to get the economy and social life up and running again. “Anyone who now talks about the fact that company closings and loss of earnings may continue into autumn and therefore calls for even more government aid is fueling uncertainty and, in my view, is acting irresponsibly.”

SPD proposes higher basic security for children

The federal and state governments agreed on Wednesday to ease the first measures to combat the corona virus. However, private and public life remains severely restricted. Small and medium-sized businesses can open again. The schools, on the other hand, remain closed for most pupils for the time being, only for a few classes there will be classes again from May 4th – individual countries may differ from the dates. The contact restrictions imposed due to the pandemic have been extended to at least May 3.

The FDP consumer politician Katharina Willkomm also rejected the VZBV boss’s push: “It cannot be that the corona crisis is being used to finally live out helicopter money dreams,” the Bundestag member told Handelsblatt. “Fortunately, we can now afford to help companies, the self-employed and employees quickly and substantially.” But the federal budget should be “no bottomless pit”. “I reject a financial protection shield that ties in with consumer characteristics.”

Because of the corona crisis, many citizens are already worried about financial disadvantages – although not the majority for the time being, as a recent poll on behalf of the VZBV showed. Exorbitant prices for perhaps scarce goods such as hygiene articles are 38 percent of the 1,006 respondents very or very worried. A third (33 percent) fear that private pension plans will lose value. Not being able to pay bills, rent or credit installments anymore is a major concern for 23 percent.

The SPD legal politician Johannes Fechner was also open to protecting not only companies but also consumers from financial difficulties. “It is important for consumers that after the shutdown has ended, the aid programs will continue and measures will be readjusted,” Fechner told Handelsblatt. He advocated continuing emergency aid for the self-employed and the regulation on short-time work benefits. He also proposed a higher level of basic security for children so that families with little or no income could also pay for the PC equipment they need through online instruction, and that all children would have the same opportunities.

Sharp criticism of voucher solution

Green consumer politician Tabea Rößner also sees a need for action. “The previous measures by the federal government, such as deferral of consumer loans or protection against unfair dismissal in the rental sector, only postpone the financial imbalance of consumers,” Roessner told Handelsblatt. “The growth of the mountain of debt must be slowed down.” For example, a special right of termination for consumers can help in the case of non-essential benefits.

Should private insolvency nevertheless occur, those affected should be excused more quickly, said Roessner. Consumers usually have to wait six years before they are released from bankruptcy in a bankruptcy procedure. According to the plans of the Federal Ministry of Justice, it will only be three years in the future. This implements an EU directive. “My parliamentary group and I asked the German government and the coalition weeks ago to bring this forward,” emphasized the Greens politician.

The FDP politician Willkomm also advocated improvements in consumer bankruptcy. “The welfare state is also there for consumers,” she said. “But we have to see that there is still a functioning welfare state after the crisis.”

However, Willkomm and Rößner are critical that the federal government wants to implement a voucher solution for all cancellations of trips and events during the corona crisis. The cabinet recently passed a bill to this effect. It stipulates that customers should temporarily waive the right to cash back in favor of a voucher.

At the same time, the government sent two letters to the EU Commission to implement such a regulation for air travel and vacation packages. The EU Commission is currently resisting such a departure from customer rights when traveling.

The background is that airlines, travel agencies and event organizers face financing problems when they have to reimburse customers for tickets and bookings due to the collapsing business in the Corona crisis. Other EU governments also want a voucher scheme.

“The planned voucher solution will exacerbate the situation of many consumers who are in financial need if repayment claims are simply converted into interest-free loans,” said Rößner. “Here, the federal government does not even provide protection in the event of bankruptcy.” With reference to event tickets or package tours, Willkomm spoke of “rescue measures unilaterally at the expense of consumers”. However, the FDP refuses to throw consumer rights overboard in the crisis.

More: Interview with consumer protector Müller: “Corona is an unprecedented stress test for our everyday life”


After a long dry spell, lawyers should get more money

Dhe federal states have agreed with the Federal Chamber of Lawyers (Brak) and the German Lawyers’ Association (DAV) to adjust the lawyer’s fees. The rates in the Lawyers’ Fees Act (RVG) are to be increased once by 10 percent, according to the key point paper negotiated on the country side by Hamburg, Hesse and Schleswig-Holstein, which the F.A.Z. is present. At the same time, court costs are to be increased. In addition to the fundamental increase, a one-off special adjustment of 10 percent is planned in social law.

Marcus Jung

For lawyers who are frequently on the go for court trials, the increase in the travel allowance from the previous 0.30 cents per kilometer to 0.42 cents in the future and the gradual increase in daily and absence allowances to 30 euros, 50 euros and 80 euros are likely to be of importance . The reform is to be implemented in this legislative period, the paper reported first “LTO”.

The consensus, which is now being presented to Justice Minister Christine Lambrecht (SPD), is likely to be expensive to buy from the lawyers’ organizations. Two years ago, Brak and DAV had spoken to Lambrecht’s predecessor Katarina Barley (SPD) for a regularly increasing adjustment in intervals of 4 to 5 years. The lawyers had decidedly rejected the associated increase in court fees. The last adjustment of the fees dates from 2013.

Backlog must be made up

The RVG adjustment was urgently required in order to ensure that legal justice continues to function properly and thus to ensure complete access to justice, DAV President Edith Kindermann emphasized. She pointed to the long period of seven years since the last increase. “During this time, wages rose by almost 19 percent without anything having changed in terms of the lawyer’s remuneration.” It was therefore “high time” to make up for this deficit in a timely manner. “We need the RVG to be accepted by the legal profession. If this is missing, legal advice on fee agreements becomes more expensive, ”the lawyer from Bremen made clear – she expects an adjustment by“ no later than January 1, 2021 ”.

The President of the Bar Association, Ulrich Wessels, is pleased that the topic is now picking up speed with lawmakers. The political groups have long signaled that they are in favor of a fee adjustment. “Now we have a key point paper from the federal states, now it is the federal government’s turn.” He assumes that the Federal Ministry of Justice and the parliamentary groups represented in the Bundestag will now, in coordination with the legal profession, quickly launch a legislative package.

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In the Federal Ministry of Justice, the lawyers’ claims are justified. Because of the possible effects of such an adjustment on the national budgets, a particularly close coordination with the federal states is required, a spokesman said – the results of the round table are now available to the ministry.

Countries consider costs justified

Bremen’s Senator for Justice Claudia Schilling (SPD) said in writing that she knew that the compromise now in place did not meet all of the lawyers’ demands, which would have supported structural changes in the fee schedule, for example, and not without reason. But ultimately it is the essence of a compromise that both sides approach each other. This is exactly what was achieved by agreeing on the result now available.

“There will be a linear increase of 10 percent,” said the current chairwoman of the Justice Ministers’ conference on Wednesday – and, by the way, according to her, this will by no means be completely covered by the parallel increase in court fees. The RVG increase will cost the countries something, but these costs are justified given the important role of lawyers in our constitutional state, ”said the Bremen Senator for Justice.

Hamburg’s Senator for Justice, Till Steffen (The Greens), was also pleased to be able to agree on a 10 percent increase in legal fees before the crisis. After seven years, the increase was overdue, said Steffen. “Furthermore, it is important to me that we quickly examine how we can support the legal profession in the current crisis in order to gain access to law as much as possible.”


What the Corona app could look like

Berlin Even if the current strict contact restrictions are still in place to further limit the spread of the coronavirus, there are already possible exit strategies from the shutdown. One way to support the exit would be to introduce a “Corona app” to avoid contact with infected people in public life. Details of a tracking app are to be presented this Wednesday.

After fierce criticism, Spahn postponed these plans. On Tuesday, however, he emphasized in Düsseldorf that it was a matter of identifying the contacts of infected people “very, very quickly” and asking them to stay at home. This is digitally “much easier” to do than with back phone calls.

Federal Minister of Justice Christine Lambrecht (SPD) considers the use of a cell phone app to detect coronavirus contact persons conceivable. However, this must be based on voluntary action, the SPD politician said on Tuesday on Deutschlandfunk.

The good thing is that the population is very willing to do this for a certain time. But it is important that the handling of the data is clarified. The data would have to be anonymized and later deleted quickly. Then you can significantly increase the readiness for such an app.

Bluetooth technology is more promising

The former Federal Minister of Justice Sabine Leutheusser-Schnarrenberger (FDP) criticized tracking of Covid-19 infected people and their contact persons based on cell data from the mobile phone provider, as Spahn had brought into play.

“This suggestion Spahns was practically unsuitable because a radio cell with a size of at least several thousand square meters can not reveal anything about the direct contact between people and thus about the risk of infection,” wrote Leutheusser-Schnarrenberger in a guest article for the Handelsblatt. “Constitutionally speaking, the proposal was therefore unsuitable and therefore disproportionate.”

The use of Bluetooth technology would be more promising and at the same time more gentle on fundamental rights. Although it was getting a bit long in the tooth, its functionality – data transmission between devices over short distances by radio – could form the technical basis for a voluntarily used smartphone application. Leutheusser-Schnarrenberger underlined: “So it works: fundamental rights must be reconciled with the protection of citizens even in times of crisis.”

But what are the options for a Corona app? Which legal aspects should be taken into account in the design? And what could the app do?

The “TraceTogether” app from Singapore has become known. It uses Bluetooth technology and uses it to identify other users who are close to their own cell phone and on whose cell phone the app is also installed.

The app also issues “timestamps”, so it keeps track of who met whom and when. This then creates a warning system: If a person falls ill with Covid-19, all close contacts of this user are informed. However, only the user IDs of the cell phones are passed on, not the actual names or telephone numbers.

App in Austria saves encounters with other people

In Austria the Red Cross has published the “Stop Corona App”. It saves encounters with other people and aims for contacts that are longer than 15 minutes at a distance of two meters. If mutually agreed, the ID of the other user is saved locally along with the date and time on the end device – the so-called digital “handshake”.

In the event of illness, all people with this digital handshake who have had contact with the patient in the previous 48 hours are informed about the app and asked to quarantine.

“Until now, the main argument in Germany against corona apps was that security authorities should not be opened to access user location data,” says Ingemar Kartheuser, lawyer and data protection expert at the Linklaters law firm.

But that is not absolutely necessary. Near field technologies such as Bluetooth could be used. “Instead of recording movement sequences, it makes more sense to send direct messages and warnings to users’ end devices if they have encountered an infected or otherwise endangered user, or to keep them away from places where they are exposed to the corona virus can infect, ”explains the legal expert.

With digital technology, a network of notified persons is created with every positive test. Data protection concerns would not conflict with the app if it was designed accordingly.

The Linklaters expert sketches as a model: The app of each user automatically saves continuously who has come into contact with in the past few days, for example who has stayed closer than ten or 15 meters.

If a user has been tested positive for Covid-19 or if they experience symptoms or suspicions, they enter this information into the app. All saved contact persons will then be informed.

At the same time, users are also informed who came into contact with such a contact person in the same period and are therefore also to be classified as risk persons. The notifications can be made anonymously, so the user’s name and device do not have to be disclosed.

Automatic push warning messages would also be possible if a user is physically close to people who are considered to be at risk, who have tested positive for Covid-19.

“With the proposed model, it is therefore not necessary for the security authorities to have access to users’ location data, neither anonymously nor personally,” explains data protection expert Kartheuser. “Because the information about the app is only between the users’ end devices, so no central data storage is necessary.”

Comprehensive use would have to be guaranteed

The use of the app should ideally be mandatory or at least be provided with strong government incentives in order to ensure widespread use, the legal expert says. This must be guaranteed by law, for example within the framework of the Infection Protection Act. “If only about half of the population uses the app, the spread of the corona virus would probably be inhibited insufficiently,” says Kartheuser.

Instead of an obligation, you could also work with an incentive system: anyone who installs and uses the app is exempt from the contact restrictions and can move around more freely. If you do not use the app, certain restrictions will continue to apply.

Additional components of the app could also be introduced, but may only be possible with personal instead of anonymous data, says the legal expert. This is the case, for example, if an “entrance control” is carried out via app in particularly vulnerable places such as subways, concert halls, bars or theaters.

“Users who are at risk would then be asked by the app not to enter the respective location or – even further – not to be let in by the operator of the appropriate facilities,” emphasizes Kartheuser. He points out that “door controls” have a stigmatizing effect and could therefore appear to be disproportionate.

Legal expert Kartheuser does not see any problems with data protection law. “If the information transferred between the users’ mobile phones remains completely anonymous, the General Data Protection Regulation does not apply in principle,” he emphasizes.

Companies could regulate access to the company premises

Should the user data actually have a personal reference, for example in the case of incoming checks at particularly risky locations, the processing of such personal data is also permitted.

“It must be ensured for all measures that the principle of proportionality is observed,” says the legal expert. User consent is not absolutely necessary. Kartheuser refers to the passage in data protection law, according to which data processing is permitted “for reasons of public interest in the area of ​​public health”.

The use of apps for companies would also be conceivable, for example to regulate access to the company premises. The prerequisite is that the employees use company cell phones. “That would be electronic control with relatively little interference with personal rights,” says Kartheuser.

Of course, the app use must be clarified under labor law: is this covered by the employer’s right to issue instructions? Is it necessary to conclude a company agreement for this? Does or should the data protection officer be involved?

“An app would be a suitable accompanying measure to get the corona crisis under control,” says Kartheuser. It is a temporary measure with a short-term storage of data, which could be based on the incubation period plus a buffer.

The state also does not produce a comprehensive database. “We have a massive impact on public life, but also on the economy. In this light, the personality interventions triggered by an app – if they exist at all and the app is not purely anonymous – appear to me to be proportionate. ”The acceptance of an app could be strengthened if – as planned in Singapore – source code and software were disclosed.

The Robert Koch Institute (RKI) is currently working on a Corona app. “We think this is a sensible concept,” RKI President Lothar Wieler said recently. “The advantage would be that we support health authorities enormously.”

More: The Ministry of Health can order the use of patents.


Electronic health record: Ministry of Justice raises concerns

Digitized healthcare

New in the cabinet draft is the regulation that the electronic prescription for prescription drugs should be mandatory from 2022.

(Photo: Hero Images / Getty Images)

Dusseldorf After several months of concerns from the environment of the Federal Ministry of Justice and Consumer Protection regarding the plans for the electronic patient record, the house has now resigned itself to the regulations. This emerges from the draft for a patient data protection law (PDSG), which is available in the “Handelsblatt Inside Digital Health” and is to be passed on Wednesday by the federal cabinet. The letter on the transfer of the draft from the Federal Ministry of Health to the Federal Chancellery, which is also available in the Handelsblatt Inside, states that the Federal Ministry of Justice has no objection to the present draft.

According to information from Handelsblatt Inside, the Ministry of Justice has long criticized that the authorization concept of the electronic patient file should only be roughly granular in the first year, that patients can only release all or none of their data to their doctor. Only from 2022 will it be possible to release individual documents. Due to concerns, the Ministry of Health decoupled the regulations into its own law about a year ago. The cabinet proposal accepted by the Ministry of Justice now shows no change in this plan.

What is new in the cabinet draft, on the other hand, is the regulation that the electronic prescription for prescription drugs should be mandatory from 2022. In addition, Bundeswehr health facilities should also be able to connect to the telematics infrastructure, the central data highway in the healthcare system. Nurses should also have access to the electronic patient files.

For the first time, the additional costs for social insurance will also be quantified through the use and administration of the electronic patient file: If the file were used by 20 percent of the population, there would be additional annual costs of 90 million euros.

The concept of data donation can no longer be found in the cabinet draft. The purpose of the data donation, however, already: “Insured [können] Provide data from their electronic patient files for use for medical research purposes. ”A new feature is that insured persons can also“ make the data from their files directly available for processing for research purposes by means of express consent ”. Consent can be given for a specific research project or for certain areas of research.

More: T-Systems no longer wants to build connectors, the central element for networking the healthcare system. The group remains at the expense of the conversion.

Handelsblatt Inside Digital Health

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Suspension of rental payments: Adidas outrages customers

Munich, Dusseldorf It was the best year in our history, ”Kasper Rorsted boasted in mid-March when he presented the results for 2019. He confidently added: “We kept what we promised.” Adidas-Chef is rarely at a loss for powerful words – including a clear compass.

And that is exactly why he and his company have now got into a very special shitstorm: When the corona crisis also hit Herzogenaurach, the Dane was forced to suspend the rent payments from his shops, wherever this is now legally possible. Despite billions in reserves. Rorsted was certain of outrage.

Like Adidas, many German and international groups are now doing it. All of their stores are closed due to the pandemic, so they want to cut costs as quickly as possible. Local rivals too puma does not want to transfer the rent for the time being, as well as chain stores like Deichmann with 1,500 shops in this country, HM with 460 shops in the Federal Republic as well as the electronics chain Mediamarkt and Saturn.

But no company is criticized for this decision as much as the sneaker manufacturer Adidas. A storm of outrage culminated on Twitter, which was by no means carried only by young trendsetters. “I always thought that managers also had social responsibility,” said automotive expert Ferdinand Dudenhöffer. Such “wild west capitalism” would make companies an enemy: “Terrible.”

Politicians such as Federal Minister of Justice Christine Lambrecht also regulated Rorsted: “If financially strong companies simply no longer pay their rents, this is indecent and unacceptable,” she said in Berlin. The Corona Aid Laws provide no basis for this. It continues to apply: “Of course, tenants have to pay their rent. If they actually experience serious payment difficulties as a result of the crisis, they can only be terminated for a limited period. “

And Minister of Labor Hubertus Heil said in the Handelsblatt interview: “I think Adidas’ behavior is irresponsible and I have no understanding for it. Adidas has made high profits in the past few years. “Now everyone should shoulder the crisis together, and nobody should duck away.

It is true that landlords cannot terminate the lease in the period from April 1, 2020 to June 30, 2020, provided that the rental debt is based on the effects of the Covid 19 pandemic. In principle, however, the tenant’s obligation to pay the rent remains.

What particularly annoys consumers on social networks: Adidas is very healthy and is now relieving the burden of the crisis on others – at least that is the accusation. Indeed, the brand with the three stripes was last shiny. The profit climbed last year by twelve percent to a good 1.9 billion euros.

It only affects 26 Adidas stores in Germany

As of December 31, the company had almost 900 million euros in cash minus all debts. The dividend should therefore increase by 15 percent, and Kasper Rorsted plans to distribute a total of EUR 800 million to the shareholders. CFO Harm Ohlmeyer also announced a share buyback two and a half weeks ago, value: up to one billion euros.

In the meantime, however, the situation has changed dramatically, Rorsted argues. Business is still reasonably normal in only three countries worldwide: China, South Korea and Japan. In Europe, North America, Latin America, many emerging markets and parts of Asia, however, the stores are closed. There, however, the group generates 60 percent of sales in normal times.

But that’s not all: there are only 26 stores in Germany, which are mainly rented out by large companies. Only four contracts affect private individuals, and these are exempt from the deferral, the group said on request. The landlords concerned, especially real estate companies and insurance companies, are very cooperative.

The thing has nothing to do with the many thousands of sports retailers through which Adidas sells its shirts, shorts and shoes in this country. Adidas has a total of 2500 stores worldwide. The deferral of the rent is also just one of many measures that Adidas must take as a precaution to protect the company and its 60,000 employees.

Puma, number three in the sporting goods industry, is similar to Adidas Nike and his Franconian arch rival. The stationary trade came to a complete standstill. It is still not foreseeable when Puma can start operating again.

“There is no turnover that is necessary to pay the rent for our shops,” said a spokeswoman. As of April, the sneaker manufacturer will therefore suspend rental payments for the time being. The company will try to find a viable solution in conversation with the landlords in Germany.

Puma is hardly criticized for this, Adidas, however, very violently. The label has even faced boycott calls since the weekend.

Perfumery chain Douglas examines the use of aid programs

For example, the two SPD MEPs Katarina Barley and Timo Wölken announced on Twitter that they would no longer buy from Adidas anymore. “As a global corporation with a profit of 3.2 billion, exploiting a protection rule for tenants in need of existence is shabby,” wrote Barley.

Wölken tweeted that the behavior of the sporting goods manufacturer was “under all sow”. Other consumers expressed similar comments.

Adidas is actually still in a comparatively comfortable situation. Other companies are already in real trouble. So the electronics retailer wants Ceconomy Apply for financial aid from the state development bank KfW because of the losses in the corona crisis. Ceconomy is the parent company of Mediamarkt and Saturn.

The Düsseldorf business has been sluggish for years. The perfumery chain Douglas has also already announced that it is considering “participating in the announced national and regional aid programs for affected companies”.

However, it is not only the large corporations that suffer from the closings, but also medium-sized companies such as the fashion company Marc O’Polo from Stephanskirchen in Upper Bavaria. Their boss Dieter Holzer is also trying to cut costs quickly: “We are talking to our landlords to find economically viable solutions for both sides,” the manager told Handelsblatt on Sunday.

The German Fashion Council, the lobbying association of the German fashion industry, wants massive help from the federal government to prevent the store from dying due to the pandemic. In an extensive catalog of claims on the crisis, the organization proposes to suspend and defer rent payments. These could be secured by bank guarantees, the proposal said.

The Adidas board has temporarily cut his salary by half. CEO Rorsted only waives 80,000 euros a month.

More: Hubertus Heil warns against loosening the measures in the corona crisis too quickly. He would like retailers to commit to reasonable collective agreements.


Politicians criticize Adidas – Twitter users call for boycott

Adidas store in Berlin

The company does not want to pay rent for its stores in April.

(Photo: Reuters)

new York The announcement of Adidas to stop paying rent for its stores due to the corona crisis has met with little understanding among politicians and the general public. Federal Transport Minister Andreas Scheuer (CSU) said the “picture”: “I am disappointed with Adidas. I am very disappointed. ”The announcement of the group is a completely unacceptable message, said Scheuer. Adidas has made huge profits in the past few years. “It is not only the large real estate facilities, but also small ones that rent to Adidas as private individuals – and which then remain at their own expense,” said Scheuer.

In addition to the sporting goods manufacturer, retail chains such as Deichmann and H&M as well as competitor Puma have also discontinued the rental payments. Adidas refers to the lack of sales as stores worldwide are closed. Deichmann spoke of a “preventive measure to maintain the company’s ability to act economically”.

The criticism is directed primarily against the sporting goods manufacturer. Federal Minister of Justice Christine Lambrecht (SPD) is also outraged: “If financially strong companies simply no longer pay their rents, this is indecent and unacceptable,” she said on Saturday in Berlin.

The Corona Aid Laws provide no basis for this. It continues to apply: “Of course, tenants have to pay their rent. If they actually experience serious payment difficulties as a result of the crisis, they can only be terminated for a limited period. “

Courts could check whether the prerequisites for this exist, Lambrecht added. Tenants are well advised to look for a friendly solution with their landlords if they are actually experiencing payment difficulties.

Calls for boycott

The hashtags #Adidas, #AdidasBoykott and #NiemehrAdidas became popular on Twitter this weekend. Many Twitter users were outraged by the announcement of the group and partially called for the boycott of the sporting goods manufacturer.

The two SPD MEPs Katarina Barley and Timo Wölken also announced on Twitter that they will boycott Adidas from now on. “As a global corporation with a profit of 3.2 billion, exploiting a protection rule for tenants in need of existence is shabby,” Barley wrote on Twitter. Wölken tweeted that the behavior of the sporting goods manufacturer was “under all sow”.

With agency material.

More: Double drama: Adidas and Nike have to close shops and do without events


How powers of attorney can threaten the assets of seniors

Berlin Monika P. is currently trying to save what can be saved from her father’s assets. Gradually she realized that her father’s partner used his serious illness to enrich himself. For example, his property management company was sold without prior evaluation. An authorization was sufficient.

The case highlights a development that is largely ignored by the German public and politicians. More and more people are getting older and in need of care. This increases the risk that proxy powers will be misused.

Chief Criminal Investigation Commissioner Annett Mau from the State Criminal Police Office in Berlin is one of the manageable number of people in Germany who have been dealing with maladministration powers for years. With a precautionary power of attorney, you can authorize confidants to make decisions for themselves – for example, to sign contracts, have accounts, and regulate insurance. “We find that the number of cases in which fraud is done with preventive powers is increasing, especially since powers of attorney can be changed relatively easily or even rewritten,” said Mau in an interview with the Handelsblatt. With new powers of attorney, existing, even notarial, powers of attorney can easily be revoked.

The cases she looks after are relatively expensive. In 2018, her department processed more than 70 cases, which totaled EUR 8.8 million, i.e. an average of EUR 124,000 per case.

Mau would like to exchange views with other federal states on this subject. However, no other federal state collects claims that are related to preventive powers. The Berlin figures were also collected manually.

Damage is difficult to prove

One problem is that the specific abuse is difficult to prove and there is usually no reason to investigate a possible abuse. Mau says that this is due to the fact itself: “Precautionary powers serve primarily to serve others who are no longer able to legally represent them.” But precisely for this reason these representatives were also not able to identify abuses and make it public. “Who reports violations by the proxy for theft, embezzlement, fraud and infidelity?” She asks rhetorically.

Monika P.’s father suffered a heavy brain hemorrhage five years ago. In this case, he had made no provision. Urgent care was set up for the then life partner for a period of six months. The father later signed a general power of attorney for her. The partner gave him the power of attorney on the grounds that decisions had to be made quickly for his company, in which the partner was also active. The partner’s son also lived in a father’s apartment, for which he paid no rent. Later he expanded the apartment according to his own ideas with two paid-out pension insurance policies of the father for around 50,000 euros. “From my point of view, my father has never been able to work again since the illness began,” says Monika P., who works as a doctor.

As long as politics has the impression that these are isolated cases, according to Commissioner Mau, no pressure is being built up. It therefore advocates a dark field study modeled on Switzerland and a specific legal sanction for financial abuse, such as in the United States. A corresponding study (“Elder Financial Abuse”) in the USA came to the conclusion in 2015 that the annual damage amounted to around $ 36 billion. According to the study conducted in Switzerland, every fourth person over the age of 55 has been the victim of financial abuse.

In principle, power of attorney is a sensible instrument for regulating personal matters yourself in good time. “Many people believe that spouses, parents or children can automatically decide in their place. That is not the case, ”says the pension handbook recently published by the Hamburg Consumer Center. Relatives also need a power of attorney.

If there is no power of attorney, the court orders legal support. An accident, illness or progressive dementia can quickly make people unable to manage their own affairs. In the case of supervision, the respective representative must regularly submit a report to the court.

In order to curb opportunities for abuse, Mau advocates an obligatory register in which the precautionary powers are stored centrally. There is currently no overview of all proxy powers, but only a pension register at the Federal Chamber of Notaries. Everyone is free to register their pension authorization there. “Obligatory registration would have the advantage that powers of attorney can no longer simply be granted in the dark and existing powers of attorney cannot simply be undone,” says Mau. In addition, other powers of attorney could then have no effect. Banks would have the possibility, for example, to ask whether a power of attorney submitted is stored there and is therefore legitimate.

Is there free will?

The detective considers it essential to conduct an independent check that such powers of attorney are not only written in the full possession of intellectual powers, but that there is also real freedom of will to do so.

In the case of Monika P.’s father, nobody examined the legal capacity. Only with legal help was it possible to convince the care court after almost a year to appoint a supervisor to control the partner. In practice, however, it is very difficult to convince courts to appoint a supervisor, it is said for those affected. This could be related to the costs, because a control supervision requires a lot of effort.

Monika P.’s father’s partner could indeed be proven to be financially abusive. She was released from office. For Monika P., however, the topic is not yet settled: “I have been trying to prove my father’s incapacity to work since the beginning of the illness in order to reverse the sale of the company.”

Although the error is obviously in the system and preventive powers are very susceptible to abuse, the Federal Government sees no need for legislative action. “Anyone who uses a power of attorney contrary to the mandate and instructions of the power of attorney and thereby causes damage to the power of attorney is liable for this damage under general civil law,” says the Federal Ministry of Justice in response to a corresponding question from the FDP. The question of who should hold the fraudster liable is unanswered.

“The problem cannot be combated if the federal government continues to close its eyes to it. I think a comprehensive database is urgently needed, ”said the spokesman for family and senior citizens of the FDP parliamentary group, Grigorius Aggelidis, the Handelsblatt. Therefore, he asked the federal government to collect the relevant data.

It would also be conceivable to establish an accompanying process in the issuance of such far-reaching preventive powers as well as to document all existing powers and to improve the advice given to older people about possible risks. The proxy authorization itself is a good and correct instrument. Ultimately, an improved process would also benefit everyone who works conscientiously and responsibly and for whom the well-being of the people being cared for comes first.

“When it comes to the laws, we always have in mind the self-employed person who realizes that he is being wronged,” says Mau. But in older, possibly demented people, it was necessary to pull guardrails preventively. Otherwise, abuse will be encouraged.

Regardless of the necessary guard rails, the LKA Berlin focuses on prevention and holds information events in old people’s homes and nursing homes, but also at banks.

In one particular case, someone had started a senior citizens’ association and was soliciting members in retirement homes. In focus: people without relatives. Residents should issue preventive powers for services – and use the senior citizens’ association as beneficiaries in the event of death. It didn’t get that far, however, because the old people’s home became suspicious and put an end to the hustle and bustle.

More: A specialist lawyer for inheritance law on the pitfalls of the power of attorney


How the federal government wants to save companies

Berlin It was an unusual Bundestag session on Wednesday morning. Only every third chair was allowed to be occupied by parliamentarians. The spaces in between had to remain free. President of the Bundestag Wolfgang Schäuble (CDU) asked the MPs to keep the necessary distance of 1.50 meters in the corona crisis in order not to infect anyone. “If there is not enough space in the hall, we have also created space in the visitors’ gallery.”

As many MPs as possible had traveled to Berlin for the meeting to ensure that the chancellor majority needed to adopt the crisis measures. However, the Bundestag stipulated for the future to be quorate even if only a quarter of the members are still present. “Parliamentary democracy will not be overridden,” said Schäuble. Parliament remains able to act.

It immediately demonstrated its ability to act. In the afternoon, the Bundestag hastily passed the billion dollar rescue packages for the economy. The Federal Council still has to agree on Friday.

“Hard weeks are ahead of us. We can cope with them if we show solidarity, ”Vice Chancellor Olaf Scholz (SPD) had previously advertised for the aid packages. Scholz spoke on behalf of Chancellor Angela Merkel, who is still in quarantine at home.

The measures would result in a supplementary budget of 156 billion euros – “a gigantic sum,” said Scholz. But this is necessary to mitigate the consequences of the crisis. In total, including sureties and discounted KfW loans, it is even about aid measures with a volume of 1.2 trillion euros.

Despite this huge sum, artisans, retailers and restaurateurs fear falling through the grate. Emergency aid is available for small companies with up to ten employees, and a new rescue fund (WSF) for large companies, which also grants direct grants as a supplement to KfW liquidity aid – provided the companies have at least 249 employees, 43 million euros in total assets and 50 million euros in sales .

Employer President Ingo Kramer praised the decisions: “What has now been launched is a huge and very targeted aid package,” he told the Handelsblatt.

The rescue package must also be accessible to companies, the associations of hotels, restaurants and caterers, Dehoga and IHA, the retail association HDE and the craft association ZDH demanded.

Fear of overwhelming the rescue package

“Many medium-sized companies with more than ten employees are at risk of falling through the network of federal support measures,” feared craft president Hans Peter Wollseifer. These companies also needed emergency aid, for example when pending wages or subsidizing rents.
Finance minister Scholz promised in the Bundestag that the government would do everything to mitigate the corona consequences. “There is no script for this.” If necessary, the government will decide on further measures. In concrete terms, Scholz already promised employers that he would have examinations made to make tax-free wages that they want to pay their employees in the crisis. That was what medium-sized companies had asked for.


In the Bundestag, however, other criticisms were initially in focus on Wednesday. A number of MPs were upset with the federal government. Around 15,000 companies are said to be able to slip under the rescue fund.

Union economic leaders fear that this large number could overwhelm the bailout fund – and lead to arbitrary decisions. Therefore, they particularly urged changes to the possibility of the rescue fund to nationalize companies in need. They demanded that the hurdles be raised so that the instrument could not be used indiscriminately.

However, the Ministry of Finance rejected all proposed changes. At 0.08 a.m. Tuesday night the house sent a large package with numerous changes to the law. “That is not possible, not even in these times,” said a CDU MP. “How are we supposed to go through the paperwork until the next morning’s resolution when we get it at midnight?”

Lambrecht for nationalization if necessary

The Federal Ministry of Finance is against criticism. “We have taken up many requests for changes, such as the desire of the federal states to put federal and state programs legally on an equal footing, or to include start-ups in the rescue package,” said the Ministry of Finance. However, one cannot take all wishes into account. And time is short.

Federal Minister of Justice Christine Lambrecht (SPD) also defended the rapid pace. “The current situation requires quick and decisive action,” the SPD politician told the Handelsblatt. She also spoke in favor of completely nationalizing companies if necessary.

“In the crisis, it is imperative that we protect our country’s economic structure and prevent major companies from being sold out or broken up,” said Lambrecht. “The state is ready to partially or wholly participate in companies if this should become necessary.”

However, the Bundestag was able to implement changes elsewhere. For example, companies that use state aid should not be allowed to pay dividends, bonuses or share packages to their top managers. The housekeepers are learning lessons from the financial crisis. At that time, board members of the real estate bank HRE had approved millions of bonuses despite the state’s rescue.

In addition, the Bundestag demands that the state sell shares in companies “at the latest after ten years”, “unless there are urgent economic reasons or reasons that are important for the German economy”, as it was stated in a bill.

“Against this background, the bonus lock for board members makes sense,” said one MP. “This is the biggest incentive for companies to get out of state participation as quickly as possible.” The Bundestag also assures itself of a say. Rescue measures of over 500 million euros are to be discussed in the Budget Committee.

Help without collateral deposited

Another new feature is that start-ups can slip under the protective shield. Up until shortly before the Bundestag session, the details were discussed. Result: All young companies are entitled to help, provided they are systemically relevant and can demonstrate goodwill of at least 50 million euros.

After the accelerated legislation, it is now a matter of publicizing many rescue measures. The statutory health insurance company points out a particularly important point in a circular: On request, companies in need can have the contributions for pension, health and unemployment insurance due for the months of March to May, so that they do not run into liquidity problems.

The employer does not have to offer any security for this, nor is deferred interest or late payments charged. However, the deferral option only applies if other government aid does not work. For example, the expansion of short-time working stipulates that companies are fully reimbursed by the state for the social contributions for lost hours.

More: What the Bundestag has decided in detail.


The federal government gives companies more time to file for bankruptcy

mechanical engineering

Many companies are threatened by the corona epidemic.

(Photo: dpa)

Dusseldorf Companies that are in financial difficulties as a result of the corona pandemic should be given more time before they have to file for bankruptcy. For this, the Federal Ministry of Justice is preparing a law that suspends the so-called insolvency application. The regulation is to apply until September 30, 2020, with the option to extend it until March 31, 2021.

“We want to prevent companies from having to file for bankruptcy only because the aid decided by the federal government does not reach them in time,” said Federal Minister of Justice Christine Lambrecht (SPD). The regular three-week period of the bankruptcy code is too short for these cases.

Comparable regulations already existed during the flood disasters in several German federal states in 2002, 2013 and 2016. Restructuring and insolvency experts had called for the federal government to push again in a comparable direction last week when it became apparent how dramatic it was the situation for the German economy is now exacerbated by the rapid spread of the corona virus.

“This law is imperative because the crisis hit the companies completely unprepared and three weeks will not be enough to initiate rescue measures,” said restructuring expert Maximilian Hacker from CMS. “In addition, it is not yet possible to predict when the global situation will relax again and what long-term consequences the corona pandemic will have.”

Just last week, the federal and state governments announced a series of measures to prevent bankruptcies and layoffs due to the corona epidemic. For example, there will be a publicly financed short-time work allowance, and existing credit programs will be expanded and taxes deferred.

High penalties for delaying bankruptcy

A specific date for the entry into force of the law to suspend the insolvency application has not yet been fixed. Industry experts expect that this will happen at very short notice.

Companies wishing to take advantage of an extended application have to consider several factors: The reason for the bankruptcy must be based on the effects of the corona epidemic. In addition, “there must be reasonable prospects of remediation based on the application for public aid or serious financing or reorganization negotiations by an applicant,” says Hacker. “In addition, the management must immediately initiate the above-mentioned rescue measures in order to obtain the privilege.”

Handelsblatt Morning Briefing - Corona Spezial

Companies that were in a crisis before the corona pandemic began must continue to adhere to the three-week deadline.

If companies fail to comply with the obligation to file for bankruptcy in good time, those responsible can expect to face serious consequences due to the delay in bankruptcy. Even negligence is punishable. They face up to three years in prison or a fine.

Richard Scholz, partner in the well-known insolvency and restructuring law firm Wellensiek, sees the German insolvency system facing a major challenge with regard to the suspension of the obligation to file for insolvency.

And further: “Also due to this much larger mass of companies affected, it will be difficult in individual cases to prove which companies only came into difficulties as a result of the Corona crisis and which had previously been in difficulties.” This proof leadership could happen, for example, by intensely illuminating the business results of the past two years.

More: Bond trading almost comes to a standstill – concern about a bankruptcy wave among companies is growing