The German Federal Court of Justice clarifies that State aid law supersedes German bankruptcy law (SKL)

Background From 1997 to 2000, BVT Industrie-Beteiligungsgesellschaft Magdeburg mbH(“BVT”), a company ultimately controlled by the German government, granted several loans to SKL Motoren und Systembautechnik GmbH (“SKL”), a company that developed and manufactured engines for ships and the energy sector. In the course of the restructuring of SKL, BVT became in September 1999 the sole shareholder of SKL. In August 2000, the European Commission initiated formal State aid proceedings to investigate the granting of the loans, and in September 2000 SKL filed for bankruptcy. In April 2002, the European Commission decided that BVT, i.e. Germany, had granted € 34.26 million of unlawful State aid to SKL, and that Germany was therefore required to recover that aid (Commission Decision 2002/898/EC of

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  • McDermott Will & Emery (Düsseldorf)

Quotation

Daniel von Brevern, The German Federal Court of Justice clarifies that State aid law supersedes German bankruptcy law (SKL), 5 July 2007, e-Competitions July 2007, Art. N° 14825

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