Investment control has become significantly more important in recent years due to the rising number of corporate acquisitions and the recent tightening of laws, especially in the light of the increase in Chinese takeovers in the area of German key technologies. In addition, as a result of the impending BREXIT, the numerous British investments in Germany will also become subject to German investment control. Over and above this, an almost uncountable number of national, European and international regulations require exporting companies to exercise the utmost care and a maximum degree of internal control. What is permitted today might not be permitted tomorrow, and any violation or circumvention of export restrictions may result in severe monetary penalties or even imprisonment. Our team’s expertise in international trade law helps ensure that nothing such will happen. Our experts are the ideal partner for you in all matters relating to export and investment control and compliance.
Our team can advise your company on all matters pertaining to export control law, in particular in connection with embargos, dual-use goods, and export restrictions under the German Foreign Trade and Payments Act (AWG) and the German Foreign Trade and Payments Ordinance (AWV), and can provide concrete training for your managing directors and staff. Due to their many years of experience and continuous further training, our experts always provide your with top quality advice when drafting and reviewing internal export control guidelines and developing and installing compliance systems.
As takeovers are very complex transactions, clients are well-advised to know, and observe, at an early stage the legal framework conditions regarding duties to cooperate and other obligations under the German Foreign Trade and Payments Act (AWG) and the German Foreign Trade and Payments Ordinance (AWV) and, where applicable, also under the relevant foreign law. Our team has great expertise in this area. As a result, we are the ideal partner for you especially in the context of bidding procedures when it comes to dealing with the investment control requirements under the German Foreign Trade and Payments Act (AWG) and the German Foreign Trade and Payments Ordinance (AWV), or to obtaining non-objection certificates and approvals from the German Federal Ministry for Economic Affairs and Energy (BMWi). The Federal Ministry for Economic Affairs and Energy (BMWi) may review the acquisition of German firms by foreign – in particular, non-European – buyers on a case-by-case basis for the purposes of guaranteeing the public order and security of the Federal Republic of Germany. In this respect, a distinction is made between cross-sector and sector-specific investment review procedures. Cross-sector investment control pursuant to Sections 55 et seq. German Foreign Trade and Payments Ordinance (AWV) is of particular importance in practice and applies to any acquisition of a German-based company – irrespective of the sector in which this company operates – by an investor based outside the EU and the EFTA. After the most recent statutory amendments in 2017 and 2019, the acquisition of a 10% stake is now enough for certain investments to fall within the scope of the German Foreign Trade and Payments Act (AWG) and the German Foreign Trade and Payments Ordinance (AWV), with a particular focus of the reviews being on stakes in “critical infrastructure” companies.
Another aspect that needs to be taken into consideration is the simultaneous review of planned transactions by other countries. Particular mention should be made of the increasingly stricter approval requirements applied by CFIUS, the Committee on Foreign Investment in the United States; however, various EU countries are also tightening their national regulations, and the EU itself is working towards harmonising the investment control provisions of its individual Member States.
We are aware of the situation in, and the particularities of, important foreign markets, also as a result of our Asian offices, and, therefore, are in a position to assist you with your export projects. In addition, we are also very familiar with investments by Chinese and other foreign investors.
We can advise you on the drafting of your contracts and support you during negotiations, thus ensuring that your company obtains the best possible results. Our team is a reliable partner in safeguarding your interests and enforcing your claims against your contract partners. While our focus is on matters relating to international trade law, our thinking is interdisciplinary and we work closely with colleagues from other practice areas, such as corporate, antitrust or tax law, whenever the situation so requires.
Investment Control under the German Foreign Trade and Payments Act (AWG) and the German Foreign Trade and Payments Ordinance (AWV) Compliance
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