Clifford Chance
European Court finds directors of English company may be liable for breach of German company law
18 February 2016
In a recent case Kornhaas v Dithmar C-594/14, the European Courts of Justice have held that the managing director of an English company is liable to reimburse the company's liquidator for failing to file for German insolvency proceedings within a 21 day time limit imposed by German company law. This was in accordance with the provisions of the European Regulation on Insolvency Proceedings (EUIR), which provides a framework for allocating insolvency jurisdiction amongst Member States and then decides which law applies to those insolvency proceedings. So because the English company was subject to German insolvency proceedings, certain aspects of German corporate law which were closely linked to the insolvency law also applied.
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