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27 December 2022
If you, as a landlord, own more than one residential lease, you are covered by the rules on holding move-in and move-out inspections.
Failure to comply with this means that you as the landlord lose your claim to repair the lease upon the tenant's vacating, this also applies even if the tenant has defaulted on the lease. A great many rent board cases include the landlord's eviction claim in connection with the tenant's eviction, and if the formalities are not in place, the landlord has lost the case in advance, which unfortunately we see all too often.
Settlement inspection
The tenant must be summoned to a move-in inspection, however, there is no requirement for a written summons or requirement for the length of the tenant's notice, as the tenant must be able to adjust accordingly in terms of time. It is our clear recommendation that the move-in inspection is always held at the same time as the keys to the tenancy are handed over.
During the actual move-in inspection, the condition of the tenancy must be documented by drawing up a real move-in report. It may be a good idea to take pictures of the rental, as a supplement to the report. The move-in report must be handed over to the tenant during the inspection itself, and the tenant must acknowledge receipt of it.
It is therefore not sufficient that e.g. send the report subsequently per email to tenant. If the report is prepared electronically, it must be sent to the tenant at the end of the inspection, and the tenant must acknowledge receipt of it immediately upon receipt.
Only if the tenant does not attend or refuses to acknowledge receipt of the report, you have the option of subsequently sending it to the tenant, which must be done no later than 2 weeks from the move-in inspection. In practice, however, this exception has little meaning.
The most important thing for you as a landlord is to prepare a correct and detailed report as well as secure documentation that the tenant has de facto received this during the actual move-in inspection.
Evacuation view
When the time has come for the tenant to move out, an eviction inspection must also be called and held.
At the eviction inspection, the tenant must be summoned to the eviction inspection in writing with at least one week's notice. In the event that the tenant does not attend the eviction inspection, it is important that the formalities surrounding the summons are complied with, as otherwise the eviction inspection cannot be validly held, and the deadline for holding it risks being missed.
Invitations can be made per letter, email or SMS, depending on your agreement on digital communication and how you have communicated so far. It is important that you have documentation that the tenant has been duly summoned.
After the tenancy has been terminated or terminated, it is possible for you and the tenant to enter into an agreement on a shorter notice for the eviction inspection. However, always remember to follow up such an agreement with a written notice, e.g. ''According to the telephone agreement, I hereby confirm our agreement on holding the eviction inspection[dato] , at[tidspunkt] ''.
The eviction inspection must be held within two weeks of the tenant's eviction (key handover), or from the time when you become aware that the tenancy has been vacated, e.g. upon notice from the tenant.
During the eviction inspection itself, a written report must be drawn up - as with the move-in inspection - in which the condition of the tenancy at the time of eviction is indicated. Again, it is a good idea to supplement the report with pictures, especially of any damage to the tenancy for which the tenant is liable. It is essential that it is specifically stated which renovation works the tenant is responsible for, e.g. wallpapering and painting walls in the living room and bedroom, replacing a broken door in the kitchen, etc.
It is not possible to make further claims than what is stated in the eviction report, unless there are hidden faults and defects which could not or should not have been discovered during the eviction inspection. Therefore, remember to bring everything with you.
The tenant must - as when holding a move-in inspection - have handed over a copy of the eviction report at the inspection itself, and the tenant must acknowledge receipt of this.
It is not sufficient that e.g. send the report subsequently per email to tenant.
If the tenant does not attend the eviction inspection or refuses to acknowledge receipt, the report must be sent to the tenant in writing no later than two weeks from the inspection.
The most important thing for you as a landlord is to prepare a correct and detailed report and secure documentation that the tenant has been summoned to the eviction inspection and has received a copy of the eviction report during the inspection itself. Alternatively, this has subsequently been sent to the tenant, due to the tenant's failure to attend or if the tenant has refused to acknowledge receipt.
In this article, DreistStorgaard's business team reviews the Danish rules on when a company is guilty of greenwashing . Today, many companies make a point of telling what they do in the ESG area, but you have to be careful that you don't communicate something that actually goes against the rules of proper marketing. The problem is that some companies make themselves out to be greener than they really are, and are thus guilty of greenwashing .
The new "quick guide" from the Consumer Ombudsman
This is the focus area of the new guidelines, a so-called "Quick Guide", which the Consumer Ombudsman has come up with [1] .
At the same time, the Consumer Ombudsman is given more money; 7 million per year in the period 2022-2025, to combat illegal greenwashing.
When companies communicate to the outside world, it is seen more and more often that they use words such as "environmentally friendly", "we focus on reducing CO2" and "we are sustainable". This gives the recipients the impression that they are dealing with a "green" company. But when are you really so "green" that you have to say so?
The rules on misleading marketing
The rules on misleading marketing are set out in §§ 5-6 of the Marketing Act and in § 13 [2] , and generally it follows that climate and environmental statements that are used in a marketing context (i) must be correct; (ii) must be clearly worded and (iii) must not omit material information.
Not only that, you must also be able to document statements about facts, which means that such statements must be able to be investigated and either substantiated by statements from or confirmed by independent experts [3] . The Consumer Ombudsman distinguishes between " general " and " specific " statements, and the way in which the two types of statements must be handled are different.
General environmental statements
General statements are positive statements such as "green", "climate friendly", "environmentally friendly" and "sustainable" - and often give the impression that there is a positive environmental effect. As the Consumer Ombudsman says, " all production will affect the environment/climate, it is therefore basically misleading to use this type of statement in marketing ". As a company, you may therefore only use these general statements in very special cases.
The following criteria have been set in relation to the use of the general environmental statements:
When using general statements, where there is also information about a specific environmental benefit of a product which explains the general part of the statement, a life cycle analysis is not necessary if it is ensured that the general part of the statement is read together with the explanation. However, a number of additional requirements are made in these situations, including that:
Concrete statements
Strictly specific statements are a little easier to use, as neutral and concrete information about a product or company given in an objective manner, without emphasizing environmental or ethical considerations, will not normally be considered suitable to mislead consumers.
But here, too, there are limits that you must be very aware of. If a product only meets environmental requirements, this must not be communicated as an environmental benefit.
You must also remember to continuously assess the statements that have been circulated, and update these if they are no longer correct. It can, for example, happen due to technological breakthroughs, which mean that a product that was previously very environmentally friendly is no longer so.
Communication on carbon footprint reduction
Many companies are working to reduce their CO2 footprint, and when communicating about this, it requires special attention to stay within the framework that the Consumer Ombudsman has now set out:
When can you call yourself sustainable?
One term in particular is often used in communication, the word "sustainable".
In the Brundtland report from 1987, which bears the title "Our Common Future", sustainability is defined as "development that meets the needs of the present without compromising the ability of future generations to meet their own needs ".
According to the Consumer Ombudsman's statement, it will be very difficult - without misleading - to call oneself or a product sustainable.
The rule is that a sustainability claim must be based on a comprehensive life cycle analysis that – when health, social and ethical issues are also taken into account – shows that the company does not impair the ability of future generations to meet their needs.
If you want to communicate that you strive for sustainability, it must be done on the basis of a concrete plan [7] , which must be verified by an independent body. If you write that you have made sustainable initiatives, you must specify which initiatives [8] are involved.
The Consumer Ombudsman has also emphasized that "sustainability" cannot be changed. It is an absolute term, and thus something cannot be e.g. "more sustainable".
The Consumer Ombudsman has thus clearly set its sights on the companies, and has thus in December 2022 tightened the marketing ban on misleading. This was expressed, among other things, when the Consumer Ombudsman completed five cases and in all the cases came to the conclusion that " they have marketed their products as sustainable without being able to document the claim " [9]
Use of "green images"
If you use "green" images in your communication[10] or slogans, one must also tread carefully. You may only use images and the like in your marketing when it portrays a correct image. And you must be able to substantiate the "green" communication[11].
The inclusion of e.g. "green" in a company name also requires that you have a very special profile that is differently good for the environment than other similar companies.
Conclusion
In DreistStorgaard's business team, we experience that more and more of our clients are working with initiatives that should result in more sustainable business operations - and that, as a natural extension of this, you want to communicate about what you do and what results you achieve.
When getting started with this kind of communication, there is good help to be found in the Consumer Ombudsman's new " Quick Guide ", which in addition to the general guidance also contains a number of concrete examples of when something is within or outside the " scope ".
Violation of the rules can not only result in fines, but also significant damage to a company's reputation, as one of the tools that the Consumer Ombudsman has in his bag is to publish decisions about companies that have been guilty of greenwashing.
The gift stick effect and resulting consumer activism can be costly both in terms of lost revenue and, more and more often, in relation to the recruitment and retention of employees.
We can contribute with the following practical advice when you need to communicate about what you do in relation to sustainability:
If you need advice, you can contact us on phone 5663 4466 or send an email to kontakt@dslaw.dk.
[1] https://www.forbrugerombudsmanden.dk/media/56731/kvikguide-om-miljoemarkedsfoering.pdf
[2] Violation of the rules of the Marketing Act can be punished with a fine.
[3] If there is disagreement between experts, this must also be disclosed.
[4] In a life cycle analysis, the (environmental) conditions are mapped and the significant (environmental) impacts are assessed throughout the product's life cycle from the acquisition of raw materials and the manufacture, use and disposal of the product as well as transport within and between these phases.
[5] E.g. "Swan label" or "EU flower"
[6] Which effectively excludes particularly polluting industries from using this kind of communication.
[7] The plan must result in the product etc. continuously improved/developed so that the load is gradually reduced, which must be measurable. An implementation of the plan must be initiated or immediately imminent.
[8] And the measures must of course concretely promote sustainability, for example the promotion of biodiversity or the choice of materials that consume less of the Earth's resources
[9] https://www.forbrugerombudsmanden.dk/nyheder/forbrugerombudsmanden/pressemädelingen/2022/virksomgerer-kaldte-produkter-baeredygdigge-uden-at-kunne-dokumentere-det/
[10] For example, the use of flowers, green fields, clean water, wind turbines, forests, animals, etc.
[11] The Consumer Ombudsman cites an example with a case of a soda bottle that was partly made from plant material and was marketed with the statement "100% reusable bottle". The statement was objectively correct, but because the statement was supplemented by a picture of the bottle, where plants, farms, windmills, animals etc. appeared. out, the marketing gave consumers the impression that it was a special environmental advantage that the bottle was 100 per cent reusable. Since all bottles – even those that were not partially based on plant material – were 100 per cent. reusable, the statement was misleading.
In 2024, the new housing tax system will be introduced, and you will have to pay housing tax on the value of your home in a new way - both as a current home owner and as a new home owner.
Until the new housing tax system comes into force, the homeowners are protected by a tax freeze on the property value tax and an increase limitation on the land debt.
The new reform will overall increase the overall housing taxation for owner-occupied apartments and owner-occupied dwellings in the large urban areas, while most homes in the countryside and in the smaller urban areas will experience a slightly cheaper tax on residential properties
The new property tax system requires new public property assessments to be made. The assessments must reflect the real value of the home, and form the basis for the new calculation of the property tax. On that basis, the property assessments help to determine what the home owners have to pay in property tax.
One of the main points in the new tax agreement is that home owners must not pay more in housing tax in 2024 than they do in 2023. Since the tax payment is maintained from 2023, there is a tax discount, which corresponds to the difference between what you pay in 2023 and what you should have paid under the new set of rules. The tax discount is given every year as long as you live in the property. This also means that those who buy a home from 1 January 2024 onwards will not get a tax discount.
If you are looking for a new home and would like to obtain the tax discount, the property must be purchased and taken over by 31 December 2023 at the latest.
The good advice from DreistStorgaard Bolighandels estate agent Camma Ryborg: "If you have found your dream home in 2023, be extra careful that you do not lose the opportunities in 2024. Check the housing tax so that you are not shocked if there is a change after the new rules per January 1, 2024 comes into force.”
If you need advice or help to assess your housing situation, contact estate agent Camma Ryborg on phone 93 60 14 05 or send an email to cry@dslaw.dk.
The Data Protection Regulation and the Data Protection Act, which have been in force since 25 May 2018, provide for a new, significantly increased level of fines that must be effective and deterrent. With the regulation, it is also assumed that the Member States harmonize the sanctions for breaches of the data protection rules.
In Denmark, it is the Data Protection Authority that, as the supervisory authority, controls the compliance of private and public authorities with the data protection rules. As far as the Courts' processing of personal data is concerned, the task is left to the Danish Courts Agency. The Norwegian Data Protection Authority processes complaints and can, if necessary, initiate investigations on its own initiative.
As part of the enforcement of the data protection rules, the Danish Data Protection Authority has been granted a number of powers. These powers are divided into investigative powers, corrective powers and approval and advisory powers. This article deals exclusively with the first two types of powers.
As far as the investigation of the data processor's compliance with the data protection rules is concerned, the Data Protection Authority can demand from the data processor any information that is of importance to its business - in other words, the Data Protection Authority can issue orders that the data processor must hand over information. Next, the Danish Data Protection Authority has access, without a court order, to the premises of the data processor, from which processing of personal data is carried out.
If the Norwegian Data Protection Authority concludes that the data processor does not comply with the data protection rules, it is assigned a number of so-called corrective powers, of which warnings, criticism, various orders, prohibitions and fines are the most important. This article deals exclusively with fines for companies.
When the Danish Data Protection Authority has to set a fine, this is generally done based on the considerations set out in the data protection regulation article 83. The fine must thus be effective, proportionate to the violation and have a deterrent effect.
Based on the general principles that follow from the data protection regulation, the Danish Data Protection Authority has issued fine guidelines regarding both fines for natural persons and fines for companies. As far as fines for companies are concerned, it follows from the guidelines for the assessment of fines for companies that the Danish Data Protection Authority first determines the so-called basic amount, which is then adjusted on the basis of a number of elements:
Since the calculation of the total fine is relatively complex, this article deals only with the general features of the calculation of the basic amount. In the calculation of the basic amount, the nature of the violation and the size of the company are taken into account. The Danish Data Protection Authority has published a number of decisions which can contribute to a more concrete understanding of the level of fines. You can find the published fine cases here.
According to the data protection regulation, companies can be fined a maximum of up to:
In addition to the powers to issue fines, the Danish Data Protection Authority is authorized to publish its statements and decisions. In practice, this means that the data processor's errors can be published on the Danish Data Protection Authority's website, from which anyone (including journalists) has access to the circumstances of the case and the Danish Data Protection Authority's position on this.
Concluding remarks
The data protection rules can seem very confusing to many ordinary people. As stated above, lack of knowledge of the rules can have very large financial consequences as well as consequences for the publicity of your company.
If you are in doubt as to whether your company's processing of personal data is in accordance with the data protection rules, you can always contact DreistStorgaard Advokater. We are available for any questions you may have. You can contact us on phone 56 63 44 66 or by email kontakt@dslaw.dk.
When you are looking for your dream home and spend your time going to open houses, it is a good idea to be prepared. It can be by writing down the questions that you would like answers to.
DreistStorgaard Bolighandel's real estate agent, Camma Ryborg, has gathered some good advice below for you who are house hunting.
Buying a home is a big decision. Our experience is that you get the best experience if you already contact an adviser while you are looking for the new home - and always before you sign the purchase agreement.
DreistStorgaard Bolighandels real estate agent Camma Ryborg has more than 18 years of experience in the real estate industry, and can help you find and buy your dream home. If you need to know more, you can contact Camma on 93 60 14 05 or by email to cry@dslaw.dk .
Many choose to sit with the responsibility of completing an estate after the death of a family member. This means that many people opt out of a lawyer and even if there is a little money to be saved on the lawyer's fee, you are on the other hand also alone with all the difficult things that have to be done in connection with estate processing.
In the event of a death in Denmark, the heirs, the banks, the Insolvency Court, the Tax Agency and various other authorities are involved. It is therefore an ongoing communication with many different agencies, and many private individuals find that the grief over the loss of the family member wells up again and again.
The deceased's assets must be disposed of, including closing bank accounts, selling securities, terminating leases or transferring properties. The deceased's liabilities must be paid, but perhaps some claims against the deceased must be completely rejected, e.g. obsolete debt.
During the processing of the estate, the Probate Court has a number of deadlines during which the heirs must submit information about the estate itself to the authorities. It is, among other things, 6 months after the death that you must submit an opening status, which is an overview of the deceased's assets and liabilities per the day of death, while a final estate statement must be submitted no later than 15 months after the death. If the deadlines are not met, the Probate Court will appoint a lawyer as executor to manage the further processing of the estate.
The final inventory must be approved by the Tax Agency and the Probate Court. This means that the value at which the deceased's assets are included is reviewed and revised, and then the Tax Agency can question the value and demand changes. You must therefore be sharp on the current rules on valuation if you want to avoid extra amounts from the Tax Agency.
If the estate's holdings are over DKK 3,160,900 (per person in 2023), an estate tax return must also be prepared with any calculation of non-payment of residual tax as well as any share and property capital gains taxation.
With a lawyer's help, you avoid overlooking important details, deadlines or legislative requirements for the estate. The actual overview of the estate, the ongoing processing of the assets and the preparation of the official documents for the authorities is something that we typically find that many people have problems with. Therefore, it can be a good idea to get a lawyer on the sidelines when one of your loved ones passes away.
At DreistStorgaard, we have lawyers who specialize in private law, and can therefore advise you and your family so that you can safely get through a difficult time. If you have questions or need to know more, contact us on phone 56 63 44 66 or by email kontakt@dslaw.dk .
By associate attorney Mette Tarp Pedersen
Crypto-assets are becoming more and more common, and they are an expression of the rapidly growing digitization and globalization in the technological and financial fields. However, they have so far been subject to very limited regulation, which is why they attract a lot of interest from a legal angle, especially for companies that intend to operate within the area. Financial regulation in Denmark is generally characterized by retail regulation, which is largely based on EU regulation. This also applies in the area of crypto asset services.
The EU and the European supervisory authorities have long focused on crypto-assets and their impact on the financial system, and in 2018 the EU adopted the 5th Money Laundering Directive for e.g. 'virtual currency'. The purpose of the directive was to meet the risks that were immediately associated with the use of virtual currencies, whereby the actors in the field were covered by the scope of the money laundering regulation. In January 2020, the directive was implemented in the Danish Money Laundering Act, which thus expanded the scope of the law to also include a number of providers of crypto asset services in the future, cf. section 2 below. Since then, the EU has accordingly put forward proposals for the Market in Crypto-Assets (MiCA) regulation in 2020, which creates an independent, supranational regulatory regime for crypto-assets in the EU, cf. section 3 below.
Under the Money Laundering Act, companies that offer a number of crypto-asset services must be registered with the Danish Financial Supervisory Authority as a Virtual Asset Service Provider (VASP), if the services are offered commercially. The Danish Financial Supervisory Authority defines a VASP as " Companies that offer services with the exchange, transfer, issuance and storage of virtual currencies. ” Covered by the Money Laundering Act and registration with the Danish Financial Supervisory Authority are then companies that:
Companies must be registered if they wish to offer one or more of the activities mentioned above, if the company is not already under the supervision of the Danish Financial Supervisory Authority in relation to other legislation. Furthermore, registration must only take place if the activity is carried out for business purposes, even if the activity is not the company's main activity. Commercial means that the activity is offered to third parties ("customers") or that the activity has such a scope that it constitutes a not insignificant part of the company's turnover. If, on the other hand, it is simply a matter of individual business dispositions that have a natural connection to the company's main activity, the company does not have to be registered, e.g. companies' ongoing placement of surplus liquidity, where the purpose is passive asset management. The provider is then obliged to carry out risk assessment and know-your-customer procedures (KYC), and is also subject to the supervision of the Danish Financial Supervisory Authority, including a number of investigation, listing and notification obligations. Members of the company's management and beneficial owners must also be assessed as fit-and-proper in connection with the registration request before the company can be registered with the Danish Financial Supervisory Authority.
In addition to the mentioned amendment to the Money Laundering Act, which now regulates a number of providers of crypto-asset services, crypto-assets are not independently regulated, which is why they basically fall outside the Danish financial regulation. This has meant that, for a number of years, providers of crypto-asset services have found themselves in a legal gray zone, where it has been doubtful which rules – if any at all – should apply, including whether a crypto-asset should be interpreted so that it is covered by the previous regulation. However, due to new EU legislation, the Danish FSA may soon supervise companies that work with cryptocurrency and technology, as the EU legislature is currently adopting a pan-European regulation of the market for cryptocurrencies with the regulation Market in Crypto-Assets (MiCA), which they have been working on since 2019.
MiCA aims to 1) create uniform rules for players in the European market for cryptoassets and related services, 2) support innovation and fair competition, 3) ensure adequate consumer and investor protection as well as market integrity, and 4) ensure financial stability. MiCA's scope of application is broad and thus aims to affect the entire industry and not just the players who either deal with or offer cryptocurrency. According to MiCA, crypto asset services may only be offered by companies that (i) is domiciled in the EU, and (ii) has been granted permission as a provider of crypto asset services by the relevant supervisory authority, which in Denmark will be the Danish Financial Supervisory Authority.
Crypto asset services are defined in MiCA as one or more of the following activities:
In MiCA, a distinction is also made between three subcategories of cryptoassets:
The regulation that providers of crypto-asset services must now comply with has certain features in common with financial legislation, including in relation to reporting and reporting requirements as well as requirements for management, but the providers will greatly benefit from the clearer guidelines in this area. MiCA will apply supranationally in all countries in the EU, and is expected to be adopted in 2023 with entry into force in 2024 at the latest.
At DreistStorgaard Advokater A/S, we have already advised a number of companies that do business with crypto assets, including providers of crypto asset services. We follow the regulation and developments closely, and we are of course available if you or your company have any questions in this regard.
You can contact us on phone 56 63 44 66 or by email kontakt@dslaw.dk.
Even if the buyer defaults on the payment of an item, according to the provisions of the Sales Act, the seller does not have the option to cancel the purchase and demand the return of the item once the item has been physically handed over to the buyer. A special exception to this, however, applies in the situation where the seller has taken a reservation of title.
A retention of title is a clause that can be included in a purchase agreement for the sale of any (movable) item, including for example a car, a boat, a house or something else entirely. A sale with retention of title implies that the buyer only owns the goods when the conditions in the purchase agreement have been met. In other words, the purpose of the retention of title is that the seller can take back the sold item if it turns out that the buyer subsequently does not comply with the purchase agreement. Even if the buyer owes money to other creditors, the retention of title also ensures that the creditors do not thereby get their receivables back in the sold item.
Form requirements:
There are a number of conditions that must be met before the retention of title is valid. In this connection, a distinction is made between consumer and business purchases.
Consumer purchase means a purchase that a consumer makes from a trader. The following conditions apply here:
Business purchases are purchases where both buyer and seller act as part of their business.
The conditions for a valid retention of title are largely the same as in consumer purchases, but where there is no requirement that the seller must be in full payment for at least 20% of the cash price at the latest upon handing over the goods.
In addition to the conditions listed above, a so-called "security deed" can also be attached to the item. The security deed is the action (deed) that is carried out to ensure that the seller's right is protected against the buyer's creditors or contract purchasers regarding the sold item.
As a general rule, no security deed is attached to a retention of title, whether it is a consumer or business purchase. A significant exception to this, however, is in particular motor vehicles, where the retention of title must be registered in the vehicle register in order to obtain protection against the buyer's creditors and contract purchasers.
The repossession:
If it can subsequently be established that the buyer unfortunately does not fulfill the conditions of the purchase contract, including in particular the payment, the seller can request the return of the sold item with the help of the bailiff, if the conditions stated above are met.
When calculating his receivables in the bailiff's court, the seller can include:
If the buyer pays the overdue services, arrears interest and any costs before the item sold has been taken back, the seller cannot take the item back.
If you want help in connection with the purchase and sale of goods with retention of title, our office is available to provide advice. We help you, regardless of whether you are a buyer, seller or a third party.
By lawyer Dennis Brixen Brandt
Plan the generational change in good time, especially in times of crisis
The general recommendation for generational change is to always start the preparations well in advance. With the right transfer structure, you can save both money and, not least, trouble.
In the event of a planned change of generations, you can make use of various transfer methods, including:
Many of the reasons that are usually at play when considering restructuring your company also apply, of course, even if there are times of crisis. It may be because a generational change awaits, because you want to separate an activity with a high risk, or because you want a better structure in the company. In certain cases, the crisis can concretely increase the need for or desire to restructure.
Tax matters
Tax succession at company and shareholder level may be preferable to transfer taxation. Especially in times of crisis, it should be considered together with one's adviser whether it would be advantageous to make the restructuring taxable.
If there is a need to restructure as part of the generational change, the lower values will reduce the need for the restructuring to take place tax-free. If the restructuring is not to take place tax-free, the restrictions that a tax-free restructuring would otherwise entail can be avoided.
Eg. will be able to save a lot of time for carrying out the generational change if the holding requirement can be avoided for 3 years after a tax-free restructuring.
Risky business
The crisis can also change the assessment of what constitutes a risky company, and thus increase the focus on separating companies into several different independent units.
If you have clear expectations in good time that one business branch will do well, while another business branch is challenged in terms of earnings, an early restructuring will be able to separate the two businesses and thus remove the risk of the unhealthy business dragging down the healthy business . If you want the restructuring to take place tax-free, it is important to be in good time so that there are no large deficits or losses that are lost in connection with the restructuring.
If a company is under pressure from the economy, so that the company's existence is threatened, the owners may want to consider whether, through a reconstruction, it is possible that the healthy part of the company's business can continue. If the crisis is so serious that the company's existence is threatened, it is rarely a good idea to carry out restructuring tax-free - especially if the profits found during the restructuring can be deducted from otherwise unused losses that will be lost in a tax-free restructuring. In these cases, it will often be most appropriate to sell the healthy part of the company to a new company. Depending on how serious the company's situation is, such a reconstruction must also keep an eye on the insolvency law rules.
The ownership structure
Changes in ownership structure, e.g. in connection with the transfer of a company to the next generation, requires thorough preparation, not least in times of crisis. In the case of a generational change, the ownership structure can be changed at once or in several stages. The different forms of generational change all have both advantages and disadvantages and therefore require careful consideration. Here, it is important to consider both the economy, tax, law and the management aspects thereof.
Need advice?
If you need advice about the change of generations and the tax matters, contact us for a non-binding chat about how we can assist in ensuring the best possible transfer from one generation to the next. You can contact us on phone 5663 4466 or by email kontakt@dslaw.dk .
In 2018, the General Conditions for Works and Deliveries in Construction and Construction (also called AB) were revised and in 2019 it entered into force as AB18. In connection with the revision, several new paragraphs were added and others were clarified.
A construction agreement is usually a very burdensome agreement for the parties, which partly involves many hours of work and a lot of money. It is precisely for this reason that it is important that the parties pay special attention to their rights and duties. This may be a contributing factor to the fact that many business operators in contracting relationships choose to enter into the agreement on AB terms. It ensures uniformity and transparency in rights and obligations, right from tender to handover and a good amount of time afterwards.
Crunch in the relationship
As in all types of contractual relationships, major challenges of one kind or another can arise within contracts, which make one of the parties want to get out of the agreement. As a starting point, it must be said that it is often in the interest of all parties to try to resolve conflicts amicably without canceling the agreement, which the AB terms also encourage.
Sometimes situations can arise that mean that the only reasonable way out is to cancel the agreement. However, it is not entirely clear in which situations one enjoys this right and the consequences of an incorrectly made decision can be great.
The developer's right to terminate a construction agreement
The developer has the right to terminate a construction agreement if one of four conditions is met. The four conditions can be summarized as follows:
Although it seems like four simple conditions, it is far from practical. It can be difficult to say with certainty whether a point in the contractual relationship falls under one of these conditions. It must be said that it depends on specific assessments from case to case.
What is fixed is; If the moment concerns a financial disadvantage, a client does not have the right to terminate the contractual relationship if the client can be satisfied in another way, e.g. through security provided or similar.
The consequence of canceling the agreement
If a developer rightfully cancels the agreement, his compensation claim against the other party could contain several parameters. It could, for example, be costs for completing the contract, costs for conversion of work already carried out and in glaring cases where the work already carried out is of such poor quality that it is not usable, the client will be able to demand repayment of the contract sum already paid.
On the other hand, the consequence for a client who withdraws unjustifiably is that the other party will be able to claim his loss covered by not being able to complete the work minus any savings, i.e. after so-called negative contractual interest. A wrong decision can therefore be costly.
Counseling
When a developer can cancel a construction agreement can be difficult to determine and have major financial consequences if you make the wrong choice. It therefore requires careful consideration and not least a thorough review of the legal basis.
We advise in all parts of the contract's lifetime, both in good times, but not least when challenges and disputes arise between the parties. Do not hesitate to contact us for an informal chat about how you can best deal with disagreements and disputes. Contact us on phone 56 63 44 66 or by email kontakt@dslaw.dk.
By solicitor Nicolai Christiansen
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