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Roland Berger appoints eight new partners in Europe

In home-country Germany, Frank Pietras and Uwe Weichenhain have joined the firm’s leadership. Pietras is based in Roland Berger’s Munich office and is an automotive expert. He specialises in automotive advisory, commercial due diligence, growth strategy, market & product strategy and business processes transformation.

Uwe Weichenhain has been with the consultancy for over a decade, and has been named a partner in the firm’s Energy & Infrastructure arm. He is an expert in new technologies that drive the transition towards sustainable infrastructure, including offshore wind, power transmission, gas and LNG, hydrogen, and digital technologies.

In the Netherlands, where Roland Berger has a team of around 100 consultants based in Amsterdam, Koen Besteman and Sameer Mehta have been promoted to partner level. Besteman specialises in the life sciences, and biopharma industry, supporting companies with innovation management, new market development, business cases, and setting up value models for research projects and portfolios. He also has gained extensive experience supporting universities with strategic and financing topics.

Having joined Roland Berger in 2010, Sameer Mehta focuses on merger & acquisition and investor support services. He works with private equity firms and corporate clients on topics related to due diligence, growth & performance improvement and restructuring. Mehta advises clients in a broad range of industries, including pharmaceuticals, healthcare and industrial products, with a particular focus on automotive, media, technology and steel.

In Sweden, Benny Guttman has been appointed a partner in the Gothenburg office. He has previously worked for three consulting firms, Accenture, EY and McKinsey & Company, prior to joining Roland Berger in 2017. In between consulting, he spent eight years at Volvo, the last six of which he was Senior Vice President at Volvo Logistics where he headed Strategy, Corporate Values and Operational Development. Guttman’s work is focused around strategic and operational improvement at clients in the automotive, manufacturing, med-tech and retail industries.

Artem Zakomirnyi has been serving the consulting firm for over twelve years, working from the offices in Moscow, Russia, and Kiev, Ukraine. He specialises in strategic and operations work in the consumer goods and retail industries. Zakomirnyi also has a deep understanding of supply chain and logistics topics, for both the traditional retail as well as online (e-commerce) retail channels.

Based in Bucharest, Romania, Szabolcs Nemes has been with the firm since 2001, in the period developing industry expertise in energy & utilities, telecommunications and transportation. His functional expertise spans strategy development, large-scale transformation, definition of new organisation models, operational excellence and efficiency improvement. Nemes supports clients in Romania and throughout the Central Eastern European region.

Last but not least, the Frenchman Pierre-Antoine Bodin, who has been named a partner in Roland Berger’s Pharma and Healthcare practice. Prior to joining the management consultancy in 2012, he spent eight years in various supply chain and marketing positions at pharma companies Johnson & Johnson and Pfizer.

Beyond the eight new partners in Europe, Roland Berger also promoted four partners in Asia and the Middle East.

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Report on Authorised Dealer’s Entitlement to Compensation

Under certain circumstances, an authorised dealer may be entitled to claim compensation after termination of the contract with the company if the latter continues to be able to use its business contacts.

In our experience at the commercial law firm GRP Rainer Rechtsanwälte, it is common for an authorised dealer’s potential claims for compensation after termination of the contract with the company to lead to legal disputes. We note that because the German legislature has not explicitly regulated authorised dealers’ entitlement to compensation, it is possible for the provisions governing commercial agents’ right to compensation under sec. 89b of the Handelsgesetzbuch (HGB), Germany’s Commercial Code, to be applied analogously.

These state that the commercial agent is entitled to claim compensation after termination of the contractual relationship with the company if he or she has established new business contacts and the company continues to be able to benefit from these contacts after the contract has come to an end. This right to compensation cannot be contractually excluded.

The provisions can be applied analogously to an authorised dealer’s entitlement to compensation under certain circumstances. The conditions that need to be met for this to happen were set out by the Bundesgerichtshof (BGH), Germany’s Federal Supreme Court, in a ruling from 5 February 2015 (Az.: VII ZR 315/13). According to this ruling by Germany’s highest court of ordinary jurisdiction, the right to claim compensation only arises if the authorised dealer was integrated into the company’s sales force and committed to making his or her business contacts available to the company so that the latter can continue using them. The authorised dealer must have committed to transferring his or her client base to the company in such a way that the company is able to readily harness the benefits of this client information without any delay. Furthermore, the authorised dealer must by virtue of special contractual arrangements be integrated into the company’s sales force to such an extent that he or she from an economic per
spective has extensive duties to perform that would otherwise have to be met by a commercial agent.

In the case in question, the BGH denied the authorised dealer the right to claim compensation because the company had not been entitled to use the client information, having contractually committed to block the transferred data and delete it at the request of the authorised dealer.

The right to claim compensation is a controversial topic in the case of commercial agents and all the more so in relation to authorised dealers. Lawyers who are experienced in the field of commercial law can assist authorised dealers and businesses in drafting agreements as well as in the event of legal disputes.

If you would like to find out more, please visit https://www.grprainer.com/en/legal-advice/commercial-law.html

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Criteria for Assessing Whether GmbH Managing Directors are Subject to Mandatory Social Security Contributions

According to a decision of the Bundessozialgericht, Germany’s federal court of appeals for social security matters, GmbH managing directors are ordinarily deemed to be employees of the company and hence subject to mandatory social security contributions.

It is not uncommon for disputes to arise over whether GmbH managing directors are subject to mandatory social security contributions. We at the commercial law firm GRP Rainer Rechtsanwälte note that it can prove to be a costly affair for the company if it is determined that the managing director is subject to mandatary social security contributions but no payments have been made to this end and therefore supplementary contributions become payable.

In rulings from 14 March 2018, the Bundessozialgericht set out clear criteria for assessing whether GmbH managing directors are subject to mandatory social security contributions (Az.: B 12 KR 13/17 R and B 12 R 5/16 R). According to these judgments, the managing director of a GmbH is ordinarily deemed to be an employee of the company. The Court held that they are only considered not to be employees if they own more than 50 per cent of the company’s share capital and are thus majority shareholders. The Court went on to state that if they have a 50 per cent stake in the share capital, a presumption in favour of self-employed status is then only possible if the articles of association clearly confer a full blocking minority on the managing director and this enables him or her to prevent instructions from being issued by the general meeting of the shareholders. The Court therefore concluded that the decisive factor for the managing director’s status as self-employed is whether he or she has the legal power to determine the fate of the company by influencing the general meeting of the shareholders.

In doing so, the Bundessozialgericht has set high standards for recognizing managing directors as self-employed. It also made clear that the crucial factor in assessing whether the managing director is an employee and thus subject to mandatory social security contributions is not how he or she acts in relation to third parties. Even if he or she is granted broad powers and freedoms, this alone does not indicate that they are self-employed. Instead, it is the extent to which the managing director has recourse to legally enforceable measures for the purposes of influencing resolutions of the general meeting of the shareholders that is the key factor.

Companies should keep in mind the issue of mandatory social security contributions for managing directors as early as when agreements are being drafted in order to avoid unpleasant surprises at a later date. Lawyers who are experienced in the field of company law can provide companies as well as shareholders with expert advice on matters that go beyond mandatory social security contributions.

If you would like to find out more, please visit https://www.grprainer.com/en/legal-advice/company-law.html

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German businesses reluctant to invest in UK over Brexit uncertainty

German business leaders have issued a strongly worded statement warning they are reluctant to invest in Britain because of Brexit uncertainty.

The intervention from German Industry UK (GIUK), which represents firms including carmakers BMW and Mercedes-Benz as well as the Lufthansa airline, came as the UK’s largest carmaker, Jaguar Land Rover (JLR), said a bad Brexit deal would put £80bn of investment and 40,000 jobs at risk.

Amid mounting anxiety from some of the UK’s largest manufacturers, politicians from both sides of the House of Commons lined up to criticise the government’s attitude towards business concerns during Brexit negotiations.

The Liberal Democrat leader, Vince Cable, accused the government of treating major employers with “complete contempt” by failing to listen to their concerns. Cable said he knew JLR boss Ralf Speth from his tenure as business secretary and that the German boss of the carmaker was “not bluffing” when he said on Wednesday that the firm’s place in the UK would be untenable in the event of a hard Brexit.

The shadow business secretary, Rebecca Long-Bailey, warned that Tory infighting over the nature of the UK’s departure from the European Union was putting jobs and investment at risk.

“They cannot continue to spar with each other and play ideological games whilst British jobs and industries are being pushed off the edge of a cliff,” she said.

The cabinet is due to meet at Chequers on Friday in an effort to thrash out disagreements among ministers about the right Brexit plan to pursue.

Just 24 hours before the summit, representatives of German firms employing 400,000 people in the UK joined JLR in issuing a dire warning about the impact of ongoing uncertainty. GIUK, whose members also include the train and bus operator Arriva – owned by the Germany’s state-owned rail company – and the steel producer ThyssenKrupp, said it needed “certainty and clarity about the way forward sooner rather than later”.

Bernd Atenstaedt, the chairman and chief executive of GIUK, said: “There is some reluctance from German business to invest in the UK with projects on hold because of the uncertainty about the future and, with only nine months left before the UK leaves the EU, time is running out.”

GIUK said German business would like continued free access without tariff and non-tariff barriers – such as customs checks – for exports to the UK, plus continued free access to the EU for exports from the UK, which is one of Germany’s most important export markets.

Atenstaedt told the Guardian that many GIUK members would not go as far as aerospace company Airbus, which has threatened to cut back their operations in the UK in the event of a hard Brexit.

JLR, the UK’s largest automotive business, this week became the latest manufacturing powerhouse to say it could be forced to withdraw investment from Britain in the event of a hard Brexit.

The warning sparked renewed criticism of the government’s attitude to industry, just days after the foreign secretary, Boris Johnson, was reported to have said “fuck business” when asked about employers’ Brexit concerns.

Cable said: “I got to know Ralf Speth well enough to know that he’s not bluffing when he says JLR’s position is that a hard Brexit would make the company’s position in the UK untenable.

“The Conservatives should listen. But there’s no evidence that they are willing to treat major employers with anything other than complete contempt.”

A spokesperson for the prime minister said the government took the views of the business community seriously. The spokesperson added: “We also know the importance of providing certainty as we leave the EU. We’re looking forward to providing further details in the white paper. But I would also make the point that we have already successfully negotiated an implementation period, so firms will be able to trade on the same terms as now until the end of 2020.”

Conservative MP Owen Paterson attracted criticism after brushing off JLR’s concerns in an appearance on the Radio 4 Today programme, claiming the company would be in a “wonderful position” and could buy car parts more cheaply.

Labour MP Alison McGovern, whose Wirral South constituency includes Vauxhall’s Ellesmere Port plant, said Paterson did not understand the automotive industry, particularly its use of “just-in-time” supply chains that require precision timing.

“It is quite stunning that Owen Paterson thinks himself better placed to comment on Jaguar Land Rover’s future than their own CEO. Perhaps even more striking is his obvious total ignorance of the just-in-time supply chains which make the car industry profitable and the fact that it is not tariffs but non-tariff barriers which would be the major obstacle to manufacturers in a no-deal Brexit.

“People in manufacturing towns across Merseyside, the north and the Midlands know all too well what it feels like when Tories show they just don’t care about our communities and our families’ livelihoods and they will not stand for it.”

A senior figure at one manufacturing trade body with strong ties to the automotive sector said: “I don’t think we’d dignify Owen Paterson’s remarks with a response because they’re not worth anything.”

Maria Eagle, whose Garston and Halewood constituency includes JLR’s Halewood plant, said the company was rightly concerned about the “appalling effects of the extreme Tory hard Brexit supported by half the cabinet and a hard-line cabal of Brexit extremists”.

She said: “It’s about time this appalling government put the interests of the people of this country above their own manoeuvring to stay in office. Otherwise, our manufacturing industry faces total destruction.”

The EEF manufacturers’ trade body said: “This is not just an issue for big companies, however, but those SMEs who are also heavily exposed in the major supply chains and, as yet, are unable to know what scenario they are planning for. Time is now running out to secure the frictionless and tariff-free relationship we need with the EU if there are not to be serious consequences right across UK industry.”

Meanwhile, a survey by Scottish Engineering has found that just 1% of its members were positive about Brexit. Its chief executive, Paul Sheerin, said the organisation was worried about “a deeply concerning stance to business coming from parts of the UK government”.

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Lessons for business leaders to take from World Cup 2018

We’ve seen it all before. We’re a likeable bunch of tryers who will put in a shift, but then watch depressed as the organised and efficient Germans prove too much for us.

A World Cup prophecy? No. That’s an analysis of European productivity rates.

The World Cup holders may have suffered a shocking 1-0 loss to Mexico on Sunday, but the characteristics of Germany’s first 11 – a well-organised unit who know their individual roles inside and out, and work hard to achieve their team’s goals – are also reflected in the country’s working economy.

But what are the other lessons that business leaders can take from the greatest tournament in sport? Are skills transferable from the beautiful game into the office?

Team Structure

Few bookmakers are tipping England to be the team to lift the World Cup trophy. According to some sports data analysts, England has less chance of winning the tournament than Peru.

However, that hasn’t deterred some fans who – for the first time in decades – are cautiously optimistic about the national team’s prospects.

In terms of ability, most would argue that past England teams have been superior “on paper”, but previous managers have failed to find the right formation to suit the team’s strengths.

Where earlier squads have failed, this year’s team has a clear plan in place. Rather than a set of square pegs for round holes, Gareth Southgate, our current manager, is going for a three-four-three formation that suits the players’ abilities perfectly.

Similarly, businesses can get the best results out of their staff by establishing the right team structure. This means creating specialised roles within clearly defined departments that are geared towards completing a specific set of tasks. It’s important that each staff member understands the requirements of the job, and is given the training and support they need to perform to the best of their abilities.

Recruitment

As the 32 managers taking part in this year’s tournament know, people decisions are often the most difficult.

When choosing their 23-man squads, the national managers were tasked with recruiting the right characters into the team without upsetting the apple cart.

Unlike England’s balanced squad, Argentina suffers from a weak defence, while boasting several of the world’s finest attacking players, from established stars like Lionel Messi to up-and-coming talents like Paulo Dybala. I’d go as far as to say that the lack of balance and cohesion jeopardises Argentina’s chances of winning.

Their top-heavy squad is a lesson to any business that fails to consider its recruitment process carefully. Organisations must employ the right balance of junior and senior staff in each department, and each function is serviced by the right number of people.

Motivation

History shows that many of the stars billed to shine at the start of the World Cup often fail to make an impact. Perhaps it’s a result of the pressure involved in the tournament, but often it’s the unexpected players and teams that capture the imagination.

Business managers can similarly reap the dividends if they are able to provide staff with the motivation and encouragement they need to perform at their peak. Ultimately, this comes down to confidence. Managers should remove barriers to staff development, and in time their self-confidence in their role will grow too.

It’s an age-old sporting cliche that youngsters play without fear. With the third youngest squad in the tournament, there is plenty of confidence in the England squad, and reason to believe that the Three Lions may yet ensure football’s coming home this summer.