New German Legislation on the Mandatory Subordination of Shareholder Loans

The publication focuses on news rules governing the subordination of shareholder loans in insolvency. The new regime – which will form part of the German Insolvency Code (Insolvenzordnung) – comprises a bright-line-approach on (i) the incidence and the scope of the subordination and (ii) the conditions for a claw-back of payments on shareholder loans and does away with a web of complex rules in various corporate laws and in case law.