Impact of the COVID-19-Pandemic on the use of profits by corporations
With regard to and in connection with the economic consequences of the COVID-19-Pandemic, numerous questions of commercial and company law arise, which in part also interact with the possibilities of applying for loans under the KfW programmes and the scope for action when using KfW loans.
The focus here - also with a view to the corporate calendar - is on questions relating to
- whether and, if so, how the economic consequences of the Pandemic are to be taken into account when preparing and adopting the annual financial statements,
- contractual and statutory restrictions on dividend payments,
- influence of the Pandemic on dividend policy,
- interaction between prohibitions on profit distribution when KfW loans are taken up and proposals for the appropriation of profits and resolutions on profit distribution,
- execution of profit distribution resolutions,
- potential liability and duties of action of the management bodies.
In our paper, we give an overview on what companies and their boards should take into consideration when dealing with financial statements and profit distributions – and how actions taken might correlate with KfW Loans.