International companies are increasingly settling legal commercial disputes abroad. In future, major legal proceedings in Germany will also be conducted in English. This was decided by the Bundestag.
In future, civil proceedings in commercial disputes in regional courts can also be conducted in English. This is stipulated in the Judicial Location Strengthening Act, which the Bundestag has passed. The law also grants the states the authority to set up so-called commercial courts at a higher regional court (OLG) or supreme regional court.
Value in dispute from one million euros
These are court panels before which commercial civil cases with a value in dispute of one million euros or more can be heard in the first instance – if the parties so wish. The commercial courts can then conduct the proceedings in either German or English. In addition, negotiations on trade secrets should be excluded from the public, and opponents should be able to be obliged to maintain greater discretion.
According to the draft law, this will provide “a fast, efficient and attractive court procedure that is geared to the needs of the economy.” This is intended to strengthen Germany as a place of jurisdiction nationally and to “gain international recognition and visibility.”
Companies are moving to other countries
“We have been observing a trend in the area of commercial disputes for many years: companies are increasingly not settling their disputes in German state courts,” explained Justice Minister Marco Buschmann. “We are reversing this trend with the law passed today.”
The Justice Ministry’s draft bill still has to be discussed in the Bundesrat. It does not need the approval of the Chamber of States. However, the Chamber of States can call on the joint mediation committee of the Bundestag and Bundesrat.