Germany Adopts Its Own Rescue Package For Financial Institutions

With unprecedented speed, on October 17, 2008, the German parliament enacted a €500 billion package of measures intended to shore up the country's financial sector and restore confidence among market participants. The new financial market stabilization law (Finanzmarktstabilisierungsgesetz, the "Stabilization Law"), which was agreed in close cooperation with members of the European Union and the G7, establishes a fund authorized to secure the refinancing of financial institutions in Germany. On October 20, 2008, the German government adopted implementing regulations (Finanzmarktstabilisierungsfonds-Verordnung, the "Decree") detailing the powers of the fund as well as the obligations to be imposed on companies that apply for support under the rescue package. Requesting state support is voluntary, but the stabilization measures will be available only until December 31, 2009.