Overview
The aftermath of the turmoil in the financial markets is still keenly felt by the legal profession. Antitrust experts are sought after for advice regarding summary proceedings and claims for compensation; however a slow but steady increase in merger control proceedings indicates the market’s recovery. Similarly, large deals began to increase in 2010 for the first time in years, with a few transactions amounting to several billion euros, even though admittedly, these were still few and far between. The German bank lending sector saw some return of liquidity in 2010, with many firms noting the willingness of banks to start lending again. Restructuring and refinancing transactions were still a notable feature of the market, as in 2009. Nevertheless, the watchwords appear to be “cautious optimism” for 2011, with a great emphasis on “transparency” in all matters. The capital markets sector was still nervous following the financial crisis, and saw only a limited number of IPOs and capital increases. The flat nature of the market was tempered towards the end of 2010 by a slight upturn in the sector, which was similarly reflected in both investment funds and structured finance. The distressed sector and small and mid-cap transactions proved a solid area for private equity. The German tax sector also had some strength with mandates concerning the increasingly frequent changes to the country’s tax rules and a number of compliance-related transactions. Nevertheless, the lack of activity in areas such as private equity, had an impact on firms’ tax practices.
The other side of the coin was the continued increase in contentious matters. Dispute resolution lawyers of almost every specialism were busy advising clients who did not want to take chances in the current volatile market situation. The public sector is still a good source of work, and restructuring and insolvency advisers have a relentless flow of new instructions. Firms have increasingly looked towards Chapter 11 bankruptcy proceedings in the US to learn what may be adapted to find its way into German or European insolvency legislation. As a result, the criteria by which German judges choose insolvency administrators for particular cases is increasingly becoming a subject of discussion.