Federal Government of Germany approved on the establishment of Commercial Courts

On 16 August 2023, the German Federal Government passed the draft of the „Justizstandorts-Stärkungsgesetz“ regarding the establishment of commercial courts and English as language of the proceedings submitted by Federal Minister of Justice Dr Buschmann [BMJ - Press Releases]. We have already reported on the first key points (see our blog post of 7 February 2023) and the draft bill (see our blog post of 27 April 2023). Compared to the draft bill, the draft of the Federal Government contains the following changes:

1. Disputes in the area of intellectual property, copyright and under the Act against unfair competition (Gesetz gegen unlauteren Wettbewerb) shall not be brought before a commercial court (Sec. 119b (1) s. 2 GVG (new)).
2. If a third party is involved in the legal dispute, it shall no longer be possible to change the language of the proceedings from English to German. The third party may request for an interpreter (Sec. 184a (4) GVG (new)).
3. A third party may also be included in the proceedings by means of a legal document in English. The third party may object the service of this document within two weeks only if he or she does not understand English (Sec. 616 (1) ZPO (new)).
4. In addition to enforceable court decisions, it shall now be possible to translate settlement agreements pursuant to Sec. 794 (1) No. 1 ZPO into German. A translation shall only be made upon the request of a party (Sec. 617 (1), (2) ZPO (new)).
5. It should also be possible to refer a legal dispute to a commercial court if the jurisdiction of a commercial court is only established by a counterclaim or an extension of the statement of claim (Sec. 620 (2) ZPO (new)).
   
   
6. The commercial court at first instance shall agree with the parties as early as possible in an organisation meeting on the organisation and conduct of the proceedings. These agreements are to gain in greater significance through the application of Sec. 224, 296 and 356 ZPO (Sec. 621 sentence 2 ZPO (new)).

Among other things, the limit of EUR 1 million for the amount in dispute, which was already provided in the draft bill, and the possibility for the Federal Court of Justice to continue the proceedings in German at its own discretion have been retained. Thus, the Federal Government's draft retains two provisions that could reduce the attractiveness of the commercial courts. It remains to be seen whether further proposed amendments will be incorporated into the bill in the upcoming parliamentary process in the German Federal Parliament (Bundestag) and Federal Council (Bundesrat).

Tobias Pörnbacher
Christina Weinzierl