Recent German court decisions in the cases of Mzoudi and Motassadeq illustrate the dilemma of dealing with international terrorism in legal terms when politicians and intelligence services believe themselves to be above or beyond the law. These cases have already been discussed in a special edition of the German Law Journal. The focus in this article is to contextualise the outcome of these cases in the “war on terror” and to analyse legal retribution, vengeance and torture on a scale of possible ways to address mass violence. The escalation of Islamist fundamentalism has the potential to rock Western democracies in their very foundations. Counter terrorism-measures in stepping up security legislation is not dealt with as such here, neither is this a fully-fledged discussion of the law of peacekeeping and armed conflict with reference to “new terrorism”. The aim here is much more modest. It is a search for truth and ways out of a dead-lock.

On February 16th, 2004 the German Federal Court of Justice (Bundesgerichtshof, BGH) delivered a judgment concerning stock options for members of the supervisory board of Mobilcom AG, a major German telecommunications company organized as a stock corporation. As is well known, German stock corporations have a two-tier board, consisting of the management board and the supervisory board. This decision by the BGH sheds again a new light on the much discussed and much disputed management structure of German stock corporations. After this decision, there are now only limited ways in which members of the supervisory board may be compensated with stock options, if at all. In the near future, even these possibilities might be foreclosed by new regulation. The following comment will give a brief overview of the case, the reasoning of the Court, the law as it stands, and finally the law as it might become.

[Editors’ Note: This short note concerns the most recent acquittals in the Mannesmann criminal trial against former Mannesmann CEO, Klaus Esser; Deutsche Bank's CEO (Vorstandssprecher) and then Member of Mannesmann's supervisory board, Josef Ackermann, and other members of the Supervisory Board. The Landgericht [Regional Court] Düsseldorf acquitted all six defendants on 22 July 2004, and this timely note provides but for a first rendition of the circumstances, the reactions and the thrust of the judgment. For more extensive background to the criminal proceedings against Esser, Ackermann et al. and the importance that domestic and international observers have regularly been assigning to this case in the context of a worldwide corporate governance debate, see already Peter Kolla's article in the 1 July 2004 Issue of German Law Journal. German Law Journal will publish a more extensive case commentary in the coming months. Meanwhile, the Mannesmann proceedings have, once more, highlighted to German, European and International observers the particular features of law and politics in “Germany Inc.”, “Rhenish Capitalism”, or “Rhineland Capitalism”. As begun in the aftermath of Josef Ackermann's inthronization at the head of Deutsche Bank and Ackermann's subsequent transformation of the Board's control structure, German Law Journal has published several contributions to the ongoing changes in German corporate governance and its embeddedness within the specific German economic and legal system. In this issue, we are publishing a fine piece by Jürgen Hoffmann, Professor of Sociology in Hamburg, on the current interdisciplinary debate over the future fate of so-called Rhineland Capitalism. In the next issue, to be published on 1 September 2004, Professor Christopher Allen of the University of Georgia will further deepen this inquiry and place the contemporary debate over the possible end of Rhineland capitalism in the historical context of Germany's development in the 20th Century. The Editors of German Law Journal are very pleased and honored to be able to provide for a further forum for this important debate, bringing together lawyers, economists, political scientists and sociologists, for a much needed exploration of the historical and political origins as well as of the legal framework of Germany's much critizised and, at the same time, ardently praised system of corporate governance and industrial relations. We invite our readers to contribute to this debate, which has so far found too little resonance in Germany itself. The Editors.]

The corporation celebrates its 400th birthday. What Adam Smith treated skeptically concerning relative efficiency in 1776, has become the dominant organizational form, and not only in Smith's home country of Great Britain.

On January, 1st 2004 the new German Investment Act (Investmentgesetz – “InvestG”) has entered into force and has established a new legal frame for funds. Especially hedge funds are regulated by German law for the first time. Nevertheless the solutions, used to establish hedge fund investments in Germany in the past, remain legal and it is argued that they will continue to play a practical role. The new InvestG on the one hand modernises German law, but on the other hand still clings to a somewhat old-fashioned regulatory approach. At the same time there are efforts at the European level to harmonise European hedge fund legislation. As a result an analysis of the German hedge fund regulation has to deal with three different, partly overlapping regimes: A past, that is still not bygone (II.), a present which is still not modern at all (III.), and a near future that will bring more changes and probably lead to an up-to-date regulation (IV.). After an introduction to these three regimes, I shall conclude with a short summary pointing out the main deficits of the new German legislation (V).

For more than a century, the cardinal provision ensuring the preservation of the capital reserve in the registered share capital amount in a Gesellschaft mit beschränkter Haftung (GmbH – German company with limited liability) has continued unaltered. This is the payout prohibition contained in § 30 (1) Gesetz betreffend die Gesellschaften mit beschränkter Haftung (GmbHG – German Act on Companies with Limited Liability), which the Bundesgerichtshof (BGH – German Federal Court of Justice) has identified as a “cornerstone of the GmbHG.“ In consideration of the impressive period of applicability and evident resistance of the provision against legislative encroachments, the lay person, for example a managing director of a GmbH as primary addressee of the provision, is now supposed to be able to assume that at least the fundamental legal issues concerning the provision have been sufficiently clarified through jurisprudence and legal practice in the meantime.

The implementation of Directive 1999/44/EC has turned German sales law on its head, and it has also led to a major reform of the general contract law. Old problems have been solved, and new ones created. Academics and practitioners have commented widely on the reform, and their perceptions range from fundamental opposition to strong enthusiasm. This article attempts to give an impression of the significance of these changes for German sales law, of the most controversially debated issues under the new law and also of the acceptance of the new provisions and of their European origin by academics and by the courts.

In its § 142(1) the American Restatement of the Law of Restitution provides that “[t]he right of a person to restitution from another because of a benefit received is terminated or diminished if, after the receipt of the benefit, circumstances have so changed that it would be inequitable to require the other to make full restitution.” The notion that the recipient of an unjustified benefit must in principle return not more than the enrichment that has actually “survived” in his hands, is not only fundamental to the American law of restitution, but can also be found in English and German law.

That the Law is never frozen in time and space is quite a trivial insight – but one, however, that is nonetheless particularly true for the area of international human rights law and the jurisdiction to see human rights norms respected and enforced. No less is it true for international criminal law and European law. It is, of course, true at the intersection of these three fields of the law as well, exactly the place I intend to explore in this paper. And, as we shall see, poetry, that rarely unveiled subtext of the law, is never steady in its foundations.

What are the key qualifications for tomorrow's attorney? And how do we have to structure legal education to teach the so-determined qualifications? The answers to both questions seem difficult, if not impossible, since they require a prediction of how the legal market will develop. However, as with most difficult questions, the answers prove to be easier than expected: In this case, they may be embodied in two poems by the German poet Erich Kästner (1899-1974) which are quite meaningful, not only in our regard. The first poem reads:

Ever since the incorporation of § 261, the offence of money laundering, into the Strafgesetzbuch (StGB – German Penal Code), the application of this statute to defence counsel has been discussed controversially. The debate stems from the extensive range of the statute, which calls not only for punishment of people who, for example, committed clandestine acts in order to conceal the criminal origin of a “dirty” object, but also from section 2, which addresses those who simply procured objects deriving from any prior crime enumerated in the money laundering offence. For defence counsel the risk of making themselves liable for prosecution is extraordinarily high. Since it is the nature of their profession that they deal with the accused and receive payment for their work, they are more likely to come in contact with and receive “dirty” money than most other people. The threat is intensified by § 261 sec. 5 StGB, a special rule on the mens rea requirement. According to this section, the money laundering offence does not necessarily require the person to know about or act with contingent intent as to the incriminated origin of the object. Instead, it is sufficient if he or she does not realise the origin, even though it was obvious, and thus acts grossly negligently concerning the incrimination of the object. Therefore, § 261 Abs. 5 StGB poses a serious threat to defence counsels since they obtain facts about their clients in order to fascilitate defence, which then may lead to the allegation that they should have realised the criminal origins of the money they received as a fee.

“I believe there is no trade-off to be made between human rights and terrorism. Upholding human rights is not at odds with battling terrorism: on the contrary, the moral vision of human rights – the deep respect for the dignity of each person – is among our most powerful weapons against it.”

Under German law, people with disabilities are entitled to help and assistance in order to avert, eliminate or improve their disability. The general goal is to overcome, as much as possible, the disability's effects and to enable the disabled to participate in all areas of society, especially in the labor market and in community life. The Federal Government is obliged to a barrier-free design and construction of public buildings, streets, etc. and to provide barrier-free access to communication, especially in the field of administrative Internet sites, official forms and notifications. In the area of public transportation, all facilities and means of transportation (bus, train, aircraft) are also required to be barrier-free. The same applies to restaurants.

On 27 November 2003 a political agreement has been reached in the Council on the compromise proposal for the Takeover bids Directive. On 16 December, the Parliament gave its approval and the proposal has still to receive the formal voting of the Council under the Irish Presidency in March 2004. Member States are required to transpose it into national law by 2006. The Directive regulates how a company or an investor that already has control in a listed company or seeks to obtain control can acquire securities in that company and applies to both voluntary and mandatory bids.

The Financial Times billed the Mannesmann trial, which began on January 21, 2004 and where final arguments by the prosecution and by the defense are scheduled for June 30, July 8 and 14, 2004 before the Regional Court (Landgericht) in Düsseldorf, as the “biggest criminal trial in German corporate history.” The backdrop for the trial was the January 2000 hostile takeover of Mannesmann AG, the once massive German telecommunications and engineering company that employed over 130,000 people. Vodafone Airtouch, the British telecommunications giant, had initially offered €101 billion for Mannesmann but only succeeded in their takeover by sweetening the price to €178 billion. Consequently, the Mannesmann takeover is still the largest the world has ever seen. The six defendants include towering figures in corporate Germany, most notably Josef Ackermann, the current chief executive of Germany's largest bank, Deutsche Bank and former member of Mannesmann's supervisory board (Aufsichtsrat). The enormity of the companies and personalities involved stretched the trial's magnitude beyond the confines of this single takeover. Reporting for their global business audience, the Financial Times conflated the trial to an indictment of Germany's entire system of capitalism. “What is on trial here is the free market itself,” wrote Wolfgang Munchau, their continental European business columnist.

During the last few years, agency work has received heightened legislative attention in Europe, on an EU level as well as on national level, since the early 1990s. This interest was spurred by the relative growth of the sector as well as by the hope that agency work might offer solutions to unemployment by providing enhanced flexibility. As a result, agency work is no longer considered as a form of employment to be shunned, but has gained in acceptance. This article undertakes to analyse the legislative development towards acceptance of agency work by comparing the EU approach with the German approach. Over and above the specific issue of agency work, the question whether needs for flexibility of employers and employees are capable of being reconciled by recourse to new methods of organising work and what regulatory policy is most likely to achieve this, forms a background to our considerations.

After giving an overview of the definition of agency work with a specific reference to the inherent risks and the potential of enhancing flexibility and resulting regulatory approaches, we will consider the EU strategy on regulating agency work, especially within the conceptual framework of the EU employment policy. The next step is to analyse the German case with reference to the historical development of the approach towards agency work and an analysis of the latest legislative reform and its practical consequences. The conclusion assesses whether the German legislation complies with the draft directive, which national peculiarities shape its practical effects and what recommendations may be referred for the final version of the draft EU directive.

Infrastructure in Iraq lies in tatters. Unscrupulous exploitation by Saddam Hussein's dictatorial regime, burdensome economic sanctions and massive destruction during the U.S.-led military operation ‘Iraqi Freedom’ have turned Iraq into one of the world's most destitute countries. On the UN Human Poverty Index for 2003, Iraq ranks seventy-first out of ninety-six developing nations. The reconstruction of basic infrastructure is but one first step towards development and economic growth. Rebuilding Iraq's infrastructure, however, involves substantial economic interests. After all, the cake to be distributed for rebuilding Iraq is expected to exceed $100 billion. Some companies see on the horizon one of the most rewarding business opportunities “undertaken in over 50 years” At the same time, there is a growing suspicion that political or even personal biases of the United States' administration have a bigger role to play than economic reason when it comes to sharing the cake. In December 2003, Deputy Secretary of Defense, Paul Wolfowitz, announced that some of America's trading partners, among them Canada, France, Germany and Russia, would be altogether excluded from competition for major reconstruction projects in Iraq. Public opinion in Europe was quick to brand the United States an international law-breaker. Can one State simply reserve to itself the final word on the Iraqi reconstruction money?

There are few cases in the law of corporate groups that have provoked as much interest, applause and critique as the Holzmüller decision of the Federal Supreme Court. On February 25, 1982, the 2nd Zivilsenat (Chamber of civil cases) of the Bundesgerichtshof (BGH – Federal Court of Justice), the highest court with assigned competences for company law, adopted what would later be known as the Holzmüller doctrine. Since then the Holzmüller case has influenced the course of countless shareholders’ meetings, been relied on in numerous shareholder actions and has initiated intensive academical as well as practical debate. What is it all about? At the core, Holzmüller deals with the balance of power between the Hauptversammlung (shareholders’ meeting) and the Vorstand (board of directors) of a German Aktiengesellschaft (AG – stock corporation) within the context of corporate groups. Practically, the protection of minority shareholders of a corporate group's parent company is a major underlying issue.

The enlargement of the European Union, the attempt to put together a constitution we can all live with, the divisions rendered raw by passionately opposed positions on the prosecution of the so-called “War on Terror” are just some of the issues which make identifying oneself as European so damn confusing of late. The inaugural conference of the European Society of International Law, held at New York University's Villa La Pietra in Florence on 13 – 15 May 2004, saw the question of what precisely Europe is fall to the international lawyers to answer. The process of drafting a European constitution had already provided the constitutionalists with the opportunity to ponder what it is that defines us and, more specifically, distinguishes us from our American cousins; in Florence, the international lawyers had their turn to mull over such questions.