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Government responds to financial crisis

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Schaefer Helge
Dr Helge Schäfer

Partner

Hamburg

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Wittgens Jonas
Dr Jonas Wittgens

Counsel

Hamburg

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20 October 2008

State-backed privileges for financial sector - Partial suspension of stock corporation law and amendment of Insolvency Code

In light of the global financial crisis, the German legislator has passed the Financial Market Stabilisation Act (Finanzmarktstabilisierungsgesetz; FMStG) together with the Ordinance Implementing the Financial Market Stabilisation Fund (Finanzmarktstabilisierungsfonds-Verordnung; FMStFV), thus establishing temporary provisions relating to stock corporation law for the financial sector at a single stroke.  Insolvency law is also to be applied differently, at least until 31 December 2010, with far fewer insolvency proceedings to be initiated in future, and the prospects for corporate restructuring measures being significantly improved.