Earlier this year we seconded one of our senior associates, Mandeep Singh Rathour, to India for a period of four months. The objective was to gain knowledge of the emerging Indian market and expand our views on the type of outbound services we could provide to Danish clients seeking to establish themselves or invest in India (without advising on Indian or other foreign laws). While our efforts with regard to India are ongoing, they are only the first steps in a larger project aimed at developing outbound services targeting more of the world’s emerging markets.
We have found that a substantial number of our clients want us to take a more active coordinating role in their activities outside Denmark, including finding and working actively with foreign counsel.
We believe that we – as a leading Danish law firm with substantial transactional and commercial knowledge and an international network of legal and business advisors – have both the ability and the responsibility to assist our clients in achieving success with their ventures.
Kromann Reumert does not advise on foreign law. We seek the assistance of our contacts located abroad in such cases.
Social networks like Facebook give rise to new legal issues
By Frank Bøggild, Partner, and Kolja Staunstrup, Lawyer
Social networks on the Internet are developing rapidly. But the law lags five years behind. Any attempt to apply current legislation to the use of Facebook, MySpace or YouTube creates a number of legal challenges.
A glance at the terms of use for Facebook, for example, doesn’t offer much help and merely raises new questions because the terms of use are subject to frequent and substantial amendments and probably wouldn’t stand up to scrutiny by a Danish court. The terms require users to comply with "the laws of the State of California". But a Danish court is unlikely to consider itself bound by such a term, and this uncertainty creates a "Wild West" situation.
When a private enterprise is active on Facebook, it must – in addition to Facebook's own terms – comply with the Danish rules.
Rules that apply in the real world also apply in the virtual world. So the Danish rules on areas such as marketing, distance selling, e-commerce, pyramid selling and gaming are fully applicable to Danish businesses on Facebook.
Areas of focus for the Danish Consumer Ombudsman
There are still no Danish decisions dealing with marketing on social networks, but in the future, the area is likely to be given priority by the Danish Consumer Ombudsman. It will be interesting to see if the Ombudsman will consider Facebook communications by commercial enterprises as covered by the spam rules, and to see how case law will develop in relation to hidden advertising.
Sanctions against illegal marketing in Denmark
Breaches of the rules governing spam, hidden advertising, misleading information, prize competitions and other similar areas might result in sanctions in Denmark.
With respect to spam, the Consumer Ombudsman has introduced a model according to which spammers face a DKK 100 penalty for each illegal act, subject to a minimum penalty of DKK 10,000.
Human resources in a time of crisis
Times have changed in the HR departments of Danish companies. The effects of cost-cutting measures need to be felt immediately, and there is no time to wait for the long notice periods stipulated by the ordinary provisions of Danish employment law.
The financial crisis has encouraged many companies to focus on fast-acting solutions that will quickly improve their liquidity. HR organisations in particular are currently facing enormous challenges.
- "We have recently experienced a period of significant labour shortage, and we also know that this crisis is not permanent. Companies are therefore interested in finding alternative solutions that will prevent or reduce the number of dismissals". This is how Claus Juel Hansen, practicing lawyer and Partner at Kromann Reumert, explains the dilemma that HR organisations are facing right now.
Part-time work, job-share arrangements, reductions in employee benefits, or ...?
The solution could be part-time hours, job sharing, or discontinued or reduced employee benefits; or perhaps a quite different solution is required. However, employers should consider that some of these changes will be deemed material changes to the employees’ terms of employment, and in the event of such changes each individual employee must be given a notice period for the changes that is of the same length as that required to terminate the employee's employment.
- "For instance, it is possible to achieve savings in, or even call off, ordinary company events, or discontinue fruit arrangements and the like, but if you decide, for example, to let the employees pay their own ADSL or mobile telephone expenses, this will be comparable to a reduction in their salary. And that will constitute a material change to their terms of employment which will require notice to be given", says Kromann Reumert Partner Helene Amsinck.
Reform for Danish Tax Law
By Arne Møllin Ottosen, Partner
On 28 May 2009 the Danish Parliament approved a major reform to Danish tax law.
The primary purpose of the tax reform is to reduce the taxation of employment income, which, for Den¬mark, is currently set at one of the highest levels in the world. However, the tax reform will also have signifi¬cant tax consequences for Danish businesses.
While the changes to individuals' taxation has drawn most attention, the tax reform significantly reshuffles the Danish regime for taxation of companies' share gains and dividends, and introduces anti-avoidance rules on intermediary holding companies. Also, the rules on limitation of interest deductions are adjusted and there may be a need for restructuring existing holding and financing company structures involving Danish companies.
Read more about the reform here.
Meeting with UN Secretary-general
On Sunday 24 May 2009, UN Secretary-General Ban Ki-moon attended a lunch meeting hosted by the Minister for Development Cooperation and participants in the Nordic Global Compact Network that have signed the Caring for Climate Statement.
At the meeting, top executives presented proposals designed to help the business community fight climate change.
Kromann Reumert’s Chairman of the Board, Jørgen Kjergaard Madsen, was among the 19 business leaders attending the meeting. Other participants included executives from A.P. Møller-Mærsk, Novo Nordisk and ICA.
The Secretary-General was in Denmark in connection with the World Business Summit on Climate Change held from 24 to 26 May 2009, an event that brought together more than 700 research scientists, NGOs, top executives, heads of government, and other leading academics and professionals from around the world.
Marianne Philip joins the Nørby committee
Kromann Reumert partner Marianne Philip has joined the reputable Danish corporate governance committee known as the Nørby Committee. The Committee seeks to promote corporate governance in Danish listed companies. Marianne will serve as Vice-Chairman of the Committee.
Doing Businesss in... 2009
Kromann Reumert has again contributed to the international handbook Doing Business in Denmark.
The handbook provides answers to some of the legal questions that arise when firms carry on business in a specific country. The book has been written in cooperation with Lex Mundi and Practical Law Company. As the only Danish law firm that is a member of the Lex Mundi association, Kromann Reumert has contributed to the handbook’s information on Denmark.
Lex Mundi comprises more than 20,000 lawyers from 160 of the world's leading law firms. The association counts among its members only the most prominent local law firms recognised for the breadth and depth of their legal expertise and the quality of their client service. In order to maintain its high standards, Lex Mundi regularly reviews each member firm.
The handbook is available online at www.practicallaw.com/dbihandbook.
ILO Client choice award for Kromann Reumert
Kromann Reumert has been awarded the ILO Client Choice Award as "best law firm for client care" in Denmark.
ILO, or International Law Office, identifies law firms that stand apart from the rest because of the excellent client care they provide. The ILO shortlist was generated from a survey of corporate counsel, which received more than 1,500 responses, as well as additional research and detailed interviews.
Law firms were assessed on a range of criteria:
- Quality of legal advice
- Value for money
- Commercial awareness
- Effective communication
- Billing transparency
- Tailored fee structures
- Depth of team
- Response time
- Sharing of expertise
- Use of technology
Read more at www.clientchoiceawards.com.
Kromann Reumert wins law firm of the year award
Kromann Reumert has once again been awarded the Danish title of National Law Firm of the Year by the International Financial Law Review (IFLR), a respected magazine that rates leading global law firms according to client recommendations and other industry feedback.
Kromann Reumert awarded top ranking in PLC Which Lawyer?2009
The international rating agency PLC Which Lawyer? has just released its annual review of leading global law firms. For Denmark, law firms are rated according to 13 main categories.
Following on from success in previous years, Kromann Reumert tops the 2009 rankings for Danish law firms in multiple categories.
Carlsberg
Kromann Reumert has assisted Carlsberg, one of the world’s largest brewery groups, in connection with the establishment of a new EMTN programme and the negotiation of two major bond loans. Amounting to EUR 1 billion and GBP 300 million, respectively, the loans were obtained in the international lending market. Partner(s) involved: Kim Rasmussen
Fionia Bank (now Fionia Holding)
Kromann Reumert has assisted the Danish regional, full-service bank Fionia Bank (now Fionia Holding) in transferring its activities to a newly established entity - also called Fionia Bank. The newly established bank is owned by Fionia Holding and is technically a subsidiary of Finansiel Stabilitet through a share pledge. In connection with the transfer, capital was provided to the new Fionia Bank (ordinary funding as well as hybrid core capital) by Finansiel Stabilitet. Finansiel Stabilitet was established in October 2008 as part of a scheme by the Danish State and financial sector to secure financial stability in Denmark. Deal value: Over EUR 5 million. Partner(s) involved: Christian Hennings, Christina Bruun Geertsen, Henrik Møgelmose, Kim Rasmussen.
DSB (the Danish State Railways)
Kromann Reumert assisted Denmark's largest train operating company, DSB (the Danish State Railways), in reaching a settlement with Italian train maker AnsaldoBreda after protracted delays in the delivery of new trains. Involving a compensation amount in the range of billions of Danish kroner, the case is one of Denmark's biggest commercial cases to date. Kromann Reumert also advised DSB in relation to a major IT agreement with a new supplier of train computers. Partner(s) involved: Erling Borcher, Erik Bertelsen, Søren Skibsted, Jens Rostock-Jensen.
Finansiel Stabilitet
Kromann Reumert has assisted Danish company Finansiel Stabilitet in connection with the sale by auction of Gudme Raaschou Bank's asset and portfolio management activities, including a small loan and deposit portfolio, to Lån & Spar Bank. Finansiel Stabilitet is a Danish company that was established in October 2008 as part of a scheme by the Danish State and financial sector to secure financial stability in Denmark. The remaining activities of Gudme Raaschou Bank, primarily involving mortgages, will be transferred to a new subsidiary of Finansiel Stabilitet. Partner(s) involved: Henrik Møgelmose
Danish Ministry of Economics and Business Affairs
Kromann Reumert has assisted the Danish Ministry of Economic and Business Affairs and the Ministry of Finance with an agreement on state-funded capital injections. Involving hybrid core capital injections, the arrangement concerns Danske Bank A/S, the largest financial enterprise in Denmark, and Realkredit Danmark A/S, one of Denmark’s largest providers of mortgage finance. Under the agreement, Danske Bank A/S will receive approximately EUR 3 billion and Realkredit Danmark A/S around EUR 270 million. Partner(s) involved: Jens Steen Jensen, Ian Tokley, Kim Rasmussen
DSV (trucking and logistics company)
Kromann Reumert advised Nordea Markets and Danske Markets in connection with a share offering by trucking and logistics company DSV. Nordea Markets and Danske Markets are respectively the financial market arms of Nordea Bank (the leading financial services group in the Nordic and Baltic Sea regions), and the Danske Bank Group (the largest financial enterprise in Denmark). The offering was conducted through an accelerated book-building process on 29 April 2009, and all new shares were fully subscribed for at a final price of 57, earning the company gross proceeds in the order of DKK 1.4 billion. The closing price on 29 April 2009 was 58.5, and therefore the final price represented a discount of approximately 2.6%. Deal value: EUR 188 million. Partner(s) involved: Marianne Philip
Danske Markets
Kromann Reumert assisted Danske Markets - the entity responsible for the financial market activities of the largest financial enterprise in Denmark, Danske Bank Group. Advice was provided in connection with a share issue with pre-emption rights to existing shareholders that was carried out by Bang & Olufsen A/S, one of the world's best-known manufacturers of high-end audio/video equipment. The issue was announced in a prospectus dated 16 April 2009. If all new shares are fully subscribed for, the issue will generate gross proceeds of approximately DKK 459 million. Deal value: EUR 62 million. Partner(s) involved: Marianne Philip.
SAS
Kromann Reumet has assisted SAS with a prospectus prepared in connection with a capital increase of SEK 6 billion. Partner(s) involved: Henrik Møgelmose, Arne Møllin Ottosen, Carsten Raasteen, Ieben Christensen