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COVID-19 – Summary of duties, measures and simplifications in Germany

20 April 2020

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The COVID-19 outbreak whilst causing concern and uncertainty, poses challenges to companies and individuals. In order to relieve some of the negative economic consequences, the German government has introduced a wide range of measures and simplifications. Further duties of the managers might also be considered.

I. Simplification for board/shareholder meetings (GmbH & AG)

The formalities to host a shareholder or board meeting are now reduced. Written resolutions and virtual board meetings are possible, even though they weren’t allowed by the existing articles of association. These simplifications will be valid until 31 December 2021 for any resolutions adopted in 2020.

Any simplifications, resulting from applicable insolvency law will only apply in case COVID-19 is the reason for any (financial) issues.

II. Simplifications for employers

Under certain conditions each company may apply for certain subsidies, for example:

  • Application for short term work
  • Home office (working from home)
    • The employer may advise its employees to work from home. Please note that for the moment the employer isn’t obliged to allow this.
    • The employer is obliged to constantly monitor the situation and analyse the risk for each individual employee.
    • The employer is responsible for acting in the best interest of the company and their employees.
  • Data Protection (GDPR)
    • Continues to apply in full when working from home.
  • Social security payments
    • This will remain the obligation of the employer, but application for suspension will be possible under certain circumstances.

III. Simplifications in relation to tax-related requirements

  • Tax returns 2018
    • Deadlines have been extended for tax returns 2018 and the applicable deadline is now 31 December 2020 (please check each state the different requirements).
    • It is to be assumed that the extension will also apply for the finalisation of the statutory financial statements 2018.
  • VAT pre-payments
    • Application for suspension of VAT prepayments (monthly or quarterly) possible, if COVID-19 is the reason (please check each state the different requirements).
  • Tax liabilities
    • Application for suspension, deferral, reduction of prepayments in relation to tax payments possible.
    • These simplifications will, so far, not apply for trade tax (this is a special municipality tax and it’s recommended check per state).

IV. Simplifications in relation to insolvency

  • Extension of application period under certain circumstances possible
  • It’ is highly recommended to check this in detail with the related advisors.

V. Additional duties of the Management

  • Each manager is obliged to monitor the ongoing business, its impacts due to COVID-19, any risks resulting from it for the business itself and any financial impacts.
  • Each manager is required to:
    • Inform its shareholders, its supervisory board (if any) or potentially the business partners on the current situation. It’s advisable to document any measure taken in writing.
    • Set up a risk management system to document measures taken against impacts resulting from COVID-19
    • Documentation shall be done in writing, via a management board resolution (if more formal documentation is required) and/or a shareholder resolution (if required by law).

VI. Financial measures/programs in Germany (a selection only)

  • Application for short term work for employers/employees to avoid terminations, insolvencies
  • Subsidies (loans, credit programs) by the “house bank” covered/secured by Kreditanstalt für Wiederaufbau (KfW)
    • For small companies (less than 10 employees, annual turnover of max EUR 2million)
      • direct payments of EUR 9,000-15,000
    • For medium sized entity (max 50 employees, annual turnover of less than EUR50 Mio or EUR 43 Mio on balance sheet)
      • Immediate loan (new as of April 2020) by KfW – to be applied via the “house bank”
      • Subsidies via the ESM, special KfW programs
      • Special loan packages by the various states
    • For large entities (more than 250 employees, annual turnover over EUR 50million. /balance sheet over EUR 43million.)
      • ESM, special KfW programs
      • Immediate loan / KfW – see above
      • Syndicated loans, backed by KfW
    • ERP subsidies – for “young” companies. Less than five years active in the market
      • details to be checked

Any updates on measures taken in Germany please visit:

For more information on the legal standing of your German company or branch please get in touch with your usual Intertrust contact or via