Monthly Dose of Germany: July 2025

Authors: Dr Gregor Bender, Klaus Heeke

Forfeiture clauses not effective for stock options after self-termination.

Since 2008 at the latest, the case law of the Bundesarbeitsgericht (i.e. German Federal Labor Court has been established that the conditions for the acquisition of stock options in employee participation programs must apply as general terms and conditions (Allgemeine Geschäftsbedingungen - AGB) and are therefore subject to a review of the content pursuant to §§ 305 ss. of German Civil Code (BGB). 

Authors: Dr Lars Hinrichs, Elisa Ultsch

The sixth edition of our Monthly Dose Employment Law in 2025 on current case law explains the judgments of 

(1) the German Federal Labor Court (Bundesarbeitsgericht, BAG) dated on the proportionality of the length of the probation period in a fixed-term employment relation-ship,

(2) the BAG dated 12.02.2025 (5 AZR 127/24) on the issue of willful failure to actively seek em-ployment during a period of release in the notice period,

(3) the BAG on the lack of evidentiary value of automated break deductions and the burden of substantiation in overtime compensation proceedings,

(4) the BAG on liability risks for employers due to delayed target setting, and

(5) the Regional Labor Court (Landesarbeitsgericht, LAG) Mecklenburg-Vorpommern on the interpretation of tariff provisions - No entitlement to prorated annual bonus payment upon termination before November.

Authors: Dennis Buschmann and Johannes T. Passas

After lengthy and partly public wrangling, the EU member states have agreed on a 18th sanctions package, including further and in some cases comprehensive financial and economic sanctions (embargoes) against Russia and Belarus. According to the EU, this sanctions package is one of the toughest measures taken since the start of Russia's war of aggression against Ukraine. The package focuses on measures in the areas of Russia's energy and financial sectors, its military capabilities, as well as stepping up efforts to combat sanctions evasion. The additions concern the Regulation (EU) No. 833/2014, Regulation (EU) No. 269/2014 (both Russia) and Regulation (EC) No. 765/2006 (Belarus). Below we give a brief overview of the most important additions and amendments and their implications for European companies.

Author: Marleen Walderich

The Digitalization Directive II contains far-reaching changes for European company law. It simplifies the international business activities of companies by reducing bureaucratic hurdles and promotes the further networking of registers and member states through the standardization of various processes. If implemented correctly, this will lead to lower transaction costs and faster processing of company law procedures in the EU internal market, while at the same time strengthening measures to prevent illegal activities such as money laundering, terrorist financing or the circumvention of sanctions.

Authors: Linda Krüpe, Andreas Leclaire and Dr. Gregor Bender

Companies are faced with the challenge of managing growing volumes of data and complex international legal requirements that vary from jurisdiction to jurisdiction. Often, there is a lack of clearly defined and sufficiently operationalised concepts for retention periods and deletion obligations, which leads to risks and unnecessary costs. To ensure compliance and clarity and reduce costs, these obligations must be harmonised in a meaningful way.
Professional data retention and deletion management helps you use storage resources efficiently, minimise legal risks and reduce costs. Deloitte supports you with tailor-made data management solutions to make your data processes sustainable and compliant.

Authors: Dr. Till Contzen and Nikola A. F. Werry

The majority of assets for large businesses are intangible, driven by digital transformation and AI. These assets are often undermanaged, but there is an opportunity for businesses to use them to drive more value, requiring a shift in how intangible data is viewed and managed.

Authors: Nadine Forstmann, Pelin Sentürk and  Macide Sarican

Following an extended consultation phase and multiple revisions, the updated Interpretation and Application Guidance (“AuA”) of the German Federal Financial Supervisory Authority (BaFin) on the German Anti-Money Laundering Act (GwG) have been in effect since March 2025.

Authors: Nadine Forstmann, Pelin Sentürk and Macide Sarican

The European Commission’s latest AML package addresses urgent vulnerabilities in the area of combating money laundering and terrorist financing (AML/CFT). Its purpose is to strengthen EU-wide AML/CFT rules and harmonise requirements across member states, closing existing legal gaps.

Authors: Johannes T. Passas and  Julia Meyer and Dennis Buschmann

In the current global economic situation, companies are increasingly confronted with complex issues relating to contractual aspects in connection with customs and foreign trade law. Particularly relevant at the moment are the impact of US punitive tariffs and how to deal with the consequences of sanctions and embargoes. This two-part article provides an initial overview of this topic for affected companies.

In Part I, we discuss who bears the economic costs of potential punitive tariffs in supply relationships and how these can be managed best. Read more here

In Part II , we will discuss how sanctions and embargoes affect supply contracts and how these can be managed best. Read more here.

Author: Katharina Zickermann

No-poach agreements are contractual agreements or understandings not to hire or attempt to hire away executives and employees of the other party or competitor. In the USA and other jurisdictions, such agreements have long been regarded as cartel agreements and prosecuted accordingly.