Liability of the state for damages in connection with the measures adopted in crisis Posted on 22. March 202023. March 2020 by Gabriela Fuchsová In order to slow down the spread of the COVID-19 virus, the government has decided to introduce the state of emergency in the Czech Republic. Subsequently, it has adopted a number of crisis measures the list of which is being extended every day. The most important measures include restrictions of the free movement of persons, closing of most shops (except groceries, pharmacies and other vital stores) and catering facilities, prohibiting of sale of accommodation services, restrictions on travel and transport and prohibiting of social, cultural and sporting events. These measures bring significant economic consequences. There is no doubt that many entrepreneurs will suffer economic losses. What can be claimed as damages? According to the Crisis Management Act the state is liable for any damages incurred in connection with the emergency measures. The law stipulates that the state is obliged to compensate the injured natural and iuristic persons for the damages. In general, damages include both actual damages (damnum emergens) and loss of profit (lucrum cessans). The actual damages comprises not only of a loss or damage to property (e.g. expired food or unusable goods), but also the costs incurred as a result of crisis measures or the costs of avoiding damages, costs of damages calculation or remedying them, including the costs of related legal assistance. This applies provided that the expenses incurred necessarily and effectively. The state can only be exempted from its responsibility if it is proved, that the damage was inflected by the injured party itself. In order to claim the damages the injured party needs to provide sufficient evidence (a) about the amount of damages incurred and that (b) suffered damages are result of adopted crisis measures. This can be difficult in many cases, especially when proving loss of profit. Currently it is unclear how the state will handle damage claims resulting from the measures adopted under the Crisis Management Act and what will be the actual amount of compensation granted to entrepreneurs. An effective (across-the-board) solution could be compensating for the loss of income suffered by entrepreneurs as a result of the measures adopted, considering the most affected industries. Any injured party is entitled to file a claim at court if it considers the compensation awarded by the state as inadequate. What to do Next? The claim for damages must be raised within 6 months after becoming aware of damages. Given the unusual nature of the situation and the extent thereof, there is no relevant previous experience or precedent in claiming damages. Historically, the courts dealt with a number of cases related to floods happening back in 2002, but the case facts are going to be very different in current situation. We could reasonably expect that the government will take economic measures that will aim to mitigate the impacts on the most affected industries. The aforementioned provisions of the Crisis Management Act will constitute one of the possible measures to compensate suffered damages. Currently the clear priority is to protect the health and safety of all persons. However, given the expected economic impact of the crisis, it is strongly recommended to commence immediately with gathering evidence and underlying documents to prove the cause as well as amount of the damages resulting from the crisis measures. In summary, we would like to note that the measures undoubtedly impact certain industries and services significantly more than other industries. In our opinion, the state should aim to make sure that economic losses are borne by the whole society as the measures adopted in times of a crisis aim to protect the health and lives of all individuals.
The 2nd COVID-19 legislative package also introduces something new with regard to deadlines for merger notifications: Posted on 22. March 202022. March 2020 by Jessica Zenz-Spitzweg For merger notifications (Art. 9 KartG 2005) received by the Federal Competition Authority prior to April 30, 2020, the deadline for review applications pursuant to Art. 11 KartG 2005 shall run from May 1, 2020; for review applications pending before the Cartel Court at the time of the entry into force of this Act or made by the end of April 30, 2020, the decision period pursuant to Art. 14 KartG 2005 shall run from May 1, 2020.
Government unveils major relief package Posted on 21. March 202029. March 2020 by Lisa Fortmüller On Wednesday (18 March 2020), the President and Prime Minister announced a relief package worth PLN 212bn to counter the fallout from the coronavirus outbreak. Although full details of the relief measures are not yet available, it is clear that the stimulus plan is going to be massive by Polish standards. The majority of the funds are intended to help struggling businesses. The package, nicknamed the “anti-crisis shield,” will be based on five pillars: labor market relief measures,business relief measures,additional funding for health services,financial sector security measures,public investment package. The measures making up the first pillar are designed to help workers keep their jobs. The government will contribute to the salaries paid by struggling businesses (it is not yet clear what criteria businesses and employees will need to satisfy to qualify for the help). The government will cover up to 40% of average salary paid on the basis of an employment contract, with the employers paying the other 40%. In case of self-employed persons and those working under civil-law contracts, 80% of the minimum salary will be paid from public funds. The allowances for parents who need to look after a child due to the closure of day care facilities will be also extended. The Office of Competition and Consumer Protection (UOKiK) and other government agencies dealing with price control are to implement measures to counter excessive pricing.The measures to be implemented as part of the second pillar are primarily intended to inject liquidity into the economy and will be handled by development institutions, as defined in the Development Institutions Act – mainly the Polish Development Bank (BGK), the Polish Development Fund (PFR) and the Industrial Development Agency (ARP). Loan guarantee will be increased to 80% of the loan. Businesses will be also offered preferential micro-loans of up to PLN 5thous. A helping hand is also extended to the transport sector, with ARP offering to cover a part of operational lease payments owed by companies operating in the sector. It was also announced that businesses will be able to delay social security payments or divide them into instalments. There are plans that contractual penalties stipulated in contracts executed under the Public Procurement Law will not be enforced. Unlike in Germany, the government was silent on the extension of bankruptcy filing deadline.As part of the third pillar, the health services are due to receive PLN 7.5bn, which especially means stepping up the financing for infectious diseases hospitals.The measures covered by the forth pillar aim to increase the security of the financial sector, incl. bank deposits, however, detailed information about the solutions have yet to be provided by the government, cooperating with the Polish Financial Supervision Authority (KNF) and the National Bank of Poland (NBP).The last pillar covers a boost to public investment worth PLN 30bn. The investments are to focus on improving energy and transport infrastructure as well as digitalization and environment protection.Poland’s leaders paint a picture of a massive and ambitious stimulus plan to save the economy from the coronavirus crisis. The President stated that details of the legislation about to be passed would be available in the days to come. We will keep you up to date on the latest developments.
COVID-19 – The activity of the National Trade Registry Office and of local trade registry offices Posted on 20. March 202023. March 2020 by Ana Pandelea The state of emergency was instituted in Romania for a period of 30 days as of 16 March 2020 (i.e. the date when Decree No. 195/2020 establishing the state of emergency in Romania was published in the Official Gazette). During the state of emergency, the activity of the National Trade Registry Office and of the local trade registry offices continues as regards the registration of amendments regarding legal and natural persons registered with the trade registry. Such activity will be carried out by electronic means, based on the request for registration of the amendments and documents attached to it in electronic form, having incorporated, attached or logically associated the extended electronic signature. act legal continues to provide assistance regarding the registration of amendments with the trade registry, by using extended electronic signature.
