Business and Law Papers

The Tax Treatment of a Mutual Fund – an Analysis with Specific Consideration of the Planned Changes to the InvStG law

On 01/01/2018, after 14 years, the current Investment Tax Act will be changed fundamentally with the Investment Tax Reform Act. With this step, the legislators are making good on their promise set out in the government’s coalition agreement. The reform wants to remedy the deficits of the current law and create an understandable and easy to administer taxation system. For this purpose, legislators have committed to some radical steps and have created a completely new management system in the future.

While there was only one taxation system until now – the so-called limited transparency principle – in the future, there will be two independent taxation systems for mutual funds and special investment funds. In particular in view of mutual funds (which are probably the first choice of "normal" small investors since they, for instance, represent a stock fund or ETF), there will be extremely significant changes since they will have a non-transparent taxation system in the future. This means that taxation will not occur only at the level of the investor, but already at the investment vehicle.

This thesis paper describes the current and future taxation system and discusses the effects of the reform. The focus lies in particular on mutual funds.

“An Increasing Shortage of Qualified Specialists Due to Unfilled Training Spots – the Wave of Refugees as a Win-Win Situation?"

Germany is a country in which high life expectancy and low birth rates is resulting in shrinking population numbers and an aging population. In addition, the rapidly increasing number of students beginning university is resulting in more and more dual vocational training spots going unfilled every year. These problems on the training market will also be noticeable in the labor market of tomorrow. There is a risk of a shortage of qualified specialists in the medium qualification area.

At the same time, in 2015 alone more than one million people fled to Germany. Most of them are young and looking for a better future than that their war-torn countries can currently offer them. One foundation for their better future can be obtained through professional training.

These two developments can result in win-win solutions for both sides - at least in theory. But what does reality look like? What prerequisites do candidates for a dual vocational training spot have to meet? What qualifications do the refugees bring with them? Does demand match supply in this case? And what legal and bureaucratic barriers are there? The state and business sector have also recognized the potential win-win situation and are trying to make this possible through numerous measures. What potential solutions are there and what else could be done?

This thesis paper looks at these questions and includes two case studies - craft businesses which offered a training contract to young refugees last year.

Possibilities and limitation of D&O insurance

Decisions of top managers can have far-ranging consequences for business development, personnel, operating equipment, capital donors, customers, the public, and the environment. The responsibility of the executives – in international terminology "directors and officers (D&O)" – comes with risks, in particular whenever liability claims are made - possibly as a consequence of a management decision.

In order to at least reduce the financial consequences of these liability risks for the top management of businesses, insurance companies offer so-called D&O insurance policies. This book provides a comprehensive overview of the "D&O insurance policies." It shows under what conditions a D&O insurance policy provides coverage and what is important to consider for managers / businesses.

The Economic Effects of Worker Migration on the Target Country – An Analysis and Depiction Using the Example of France

Worker migration: tricky, uncontrollable trigger for uncertainty, but nonetheless a necessity?

Migration and its effects on the labor market of the target country is still a very controversial topic and is frequently seen as origin of inequality. In particular in times of economic downturn and increasing unemployment, one can notice an increase in the prevalent skepticism of migrants. At first glance, it all appears to make sense that the expansion of the labor supply leads to decreasing salaries and, if salaries are not adjusted, to increasing unemployment among the native population.

However, can the economic arguments for justifying a restrictive migration policy targeted at protecting the domestic labor market be generalized and scientifically proven?

This article presents and analyzes the different theoretical and empirical assumptions and models for how and through which mechanisms migration can affect the labor market of the target country. The focus lies on the question about the salary and employment effects of migration on the native labor force, with a focus on the situation in France. Of particular significance are the profile of the migrants, the determining factors that lead to migration, national and European guidelines and laws, and the economic situation of the target country. In addition, we arrive at equally interesting insights by considering the adaptation of markets over the long term. Using interviews with two French companies, we also elucidate the effects with a concrete example.

The effects of labor force migration on the equilibrium and dynamics of the native labor market appear to be complex, in contrast to the assumptions made by the public and even by many economists. This paper investigates whether migration leads to a threat to or an opportunity for the labor market of the target country; what groups profit and lose on the labor market; and what challenges present themselves.

A Differentiated Analysis of the Electronic Buying Behavior of Men and Women   

Electronic retail plays an ever-increasing role in Germany's economy and for customers. This can be seen not only in the increasing sales but also in the ever-increasing acceptance of the internet as electronic market place. In this context, the question arises whether differences in the buying behavior of men and women also appear in electronic retail. Since buying in electronic retail follows other rules and behavior patterns, it makes no sense to apply the assumptions from traditional consumer research.  

This is where the author of this paper, Julya Fromme, graduate of the Master program in Leadership at the University of Applied Sciences Frankfurt am Main, begins her argument. In order to gain insights into electronic buying behavior, she applies traditional consumer research, neuro-marketing, and gender research as a basis. The results of different current studies are expanded and verified with a survey conducted at the University of Applied Sciences Frankfurt.  

A precise classification of the buying behavior of men and women is not possible in either the traditional or the electronic retail sectors. However, tendencies and preferences can be determined. These can be used to derive recommended actions for the design of online shops. The analysis of the student target group also shows that such classifications not only depend on different life phases but also change over time.

Crowdfunding in Germany as an Alternative Financing Option – Opportunities and Risks vs. Legal Requirements

The paper studies the legal framework conditions of crowdfunding in Germany. In simple terms, this is about the financing of business models through the mass collection of small donations via the internet. In contrast to the US, this is still very new in Germany and has not yet been completely developed in legal terms. For this purpose, the paper provides an in-depth analysis that includes consideration of the basic constellation in civil law as well as aspects of market regulation (Securities Prospectus Act, Assert Investment Act) and institutional oversight (in particular the Banking Act). Furthermore, we provide balanced proposals for the legislative support of crowdfunding in Germany.

Gender Marketing in the Online Clothing Retail Sector with a Focus on Hedonistic Shopping Behavior

Online shops play an increasingly important role today as an alternative to traditional storefront shops. The clothing industry also sells a majority of its goods over the internet. In this context, we examine five different purchase motivators (by Arnold/Reynolds) in terms of hedonistic shopping on the internet. The focus lies on the separate consideration of the motivation degrees among women and men. The results are supposed to uncover new insights and help address women and men separately and thus more specifically through gender marketing. The data survey was performed using a standardized online questionnaire. The snowball sample was directed at online shoppers ages 18–50+.

ISBN: 978-3-942555-16-6

Design Options for Permanently Securing the Influence of the Owner of Family Businesses with the Legal Form of an AG or GmbH

A majority of German, in particular medium-sized, businesses is owned by one or several families or is influenced by families. In most cases, the owners have a great interest in maintaining their influence in the business for as long as possible and keeping the business in the hands of their family even after they leave the company or pass away. Problems can arise, for instance, if shares or stock were sold to third parties not in the family during capital procurement efforts, and thus there is a risk of dominant outside influence, or in the event of an inheritance, conflict can arise that threatens to split-up the business, for instance due to disputes among the heirs.  

This thesis paper illustrates possibilities for how the owners of a business in the legal form of an AG or GmbH can ensure their influence on the business decisions as well as the continued existence of the business across generations. In this context, the paper discusses designs based on restrictions on transferability and voting rights restrictions or exclusions and the possibilities for influencing the staffing of the Board of Supervisors. Furthermore, we present possibilities of securing and maintaining influence through  targeted succession planning. As examples, we mention inheritance contracts, provisions on how to separate the estate, execution of a will, and anticipated succession. These instruments can help the owners influence who continues the management of the business over generations and prevent that the business is split up and sold in the worst case scenario of inheritance disputes and compulsory portion claims.

ISBN: 978-3-942555-15-9

Possibilities of the Management Factor on the Group Dynamics in Companies

Group work is very important in today's business world. However, the work results or group targets achieved do not always live up to the expectations of the managers. This may be due to the way the group functions or the relationship between the supervisor and the group members.

This is where the author of this paper, Sabrina Bode, graduate of the Master program in Leadership at the University of Applied Sciences Frankfurt am Main, begins her argument. She examines the possibilities that are available to a manager for influencing the dynamics of a group. For this purpose, she works through the system-theoretical understanding of groups and their function. In addition, the analysis of the internal and external influences on groups in the business environment results in important insights. The main focus lies on the influencing factor of the manager. This paper goes beyond the manager-employee relationship and considers the relationship of a manager to a group. Based on the system-theoretical perspective, the group with its complex nature is represented as a entity that is fundamentally impossible to influence in a targeted manner. A manager cannot know how a group processes and implements influences that act on it. The question arises how to influence a group that is fundamentally impossible to influence in a targeted manner. For this purpose, the author has developed a model that displays the different options a manager has to influence a group.

While it is not possible to achieve complete targeted management of the group dynamics, this model does convey to personnel managers a realistic picture of the possibilities that a manager has to influence this dynamic. In addition, it represents a basis for verifying the manager’s perception of his/her role and his/her responsibility in this role. This is significant, since executives should always be aware of the fact that a functional, independently acting group can act as innovators and this generates a qualitative added value for businesses.

ISBN: 978-3-942555-14-2

Education and Knowledge in the Organizational Context - Successful Business Management Through Professional Management of Intangible Resources

The globalization of the markets leads to increasing competition for businesses. High-quality goods and services are becoming increasingly important to survive in international competition. However, creating them requires lots of know-how and adequately trained workers. In this respect, competent employees are becoming increasingly more important from the perspective of the companies. Not lastly because demographic change will reduce their availability even further in the future. Competent employees or (more precisely) their education and skills represent valuable resources. It is important to tap into and develop them with a plan to use them in the best possible way for the business. This well-planned endeavor is all the more difficult due to the intangible nature of education and knowledge. For this purpose, a systematic approach that accounts for this problem is necessary.

The author of this paper – Dipl. Economist (UAS) Sören Hense, M.A. uses this as his starting point. In this context, he shows the terminological interdisciplinary and heterogeneous nature of education and knowledge and uses these terms in a business administration context. Based on this, two separate yet interconnected management concepts are developed, which distinguish themselves by their pragmatic character and can be applied in every business – regardless of the size or industry. Using these concepts, the development of the education and knowledge of each individual employee can be planned, managed, and controlled systematically.

ISBN: 978-3-942555-13-5

The Freedom of Information Act within the Strained Relationship Between the Interests of Capital Market Regulation and the Market Participants - Is the Right to Information Disclosure from BaFin Too Far-reaching?

This paper deals with entitlements to information against the Federal Regulatory Commission for Financial Services (BaFin) according to the Freedom of Information Act (IFG). Such an – unconditional – entitlement exists for all federal agencies. However, BaFin in particular is very frequently asked for such information. As the obligated party, it also stands in the middle of a number intermeshed interests and motives of regulatory agencies, capital market participants, and interested claimants who are also potential candidates for future claims for damages against market participants. As the result of information claims being asserted in court, the topic has been gaining practical significance and explosiveness for some time now.

ISBN: 978-3-942555-12-8

Effects of Basel III on Bank Loans to Small and Medium-Sized Businesses

A Comparison Between Germany and France

The prosperity of an economy primarily depends on the growth of its businesses. However, sustainable growth can only be generated with investments that generally require third-party financing. For this reason, financial institutions are essential for the prosperity of an economy.

As a result of the sub-prime crisis, which developed into a threat for many economies, the finance sector has been subjected to special observation and criticism.

As a reaction to this severe global finance market and economic crisis, stricter regulations of credit institutions were agreed upon. The Basel III concept developed in this context is supposed to stabilize the globally networked finance system and limit the risk of new crises.

In conjunction with these framework agreements, banks have access to different measures. As a consequence, small and medium-sized businesses (SMB) fear reduced bank lending or an increase of interest margins, since SMBs are very dependent on bank loans.

In her thesis paper, Jennifer Brod conducted studies that uncover the potential effects of increased equity and refinancing requirements on loans to SMBs in Germany and France.

The basis for these studies are the financing structures of German and French SMBs.

Student Support - A Study at Six European Universities

In times of scarce university places and after the transition due to the Bologna process, students’ success with their studies - preferably within the regular program duration - is becoming increasingly important. In addition to optimizing the teaching of subject-related knowledge, the significance of support services that go beyond subject-related aspects is becoming more important. Career centers, student support centers, departments for students, student advisory services, mentoring, and coaching are keywords for the institutionalization of this subject area in educational institutions.

Until now, there has not been a theoretically-based "design system for student support." This study therefore performs an explorative basic function and can provide decision-makers with initial ideas for the orientation and operative design of student support. We see that so far there has been a great variety of not very well thought-out designs of student support in many places.

Dr. Nicolas Giegler and Diplom Economist (UAS) Sören Hense conducted an explorative study at the University of Applied Sciences Frankfurt am Main which is being undertaken at six European universities. The results illustrate a possible basic design for the topic of student support. In addition, a variety of operative implementation options is presented, the final look of which could be freely chosen. This provides the responsible parties at educational institutions with a foundation for establishing their own support services for the success of the students on a wider and more targeted basis.

Feel-Good Factor Volunteering?

Analysis and Recommended Actions for Different Satisfaction Factors of Volunteers

The third sector in Germany encompasses all organizations that cannot be classified as belonging to either the public or the private business sector. Also called non-profit sector, it is becoming increasingly indispensable for ensuring the provision of many social goods and services. For this reason, volunteers of non-profit organizations have been and are absolutely indispensable for ensuring the continued existence of the institutions.

In order to account for this fact, it should be determined as precisely as possible why people commit as volunteers, what their motives are, and from where they derive the satisfaction with their commitment that keeps them from ending this commitment and spending their precious time otherwise.

In this diploma thesis, mentored by Dr. Nicolas Giegler, possible satisfaction factors of volunteers are collected and analyzed based on different studies on the topic. This serves the purpose of creating a tool that can be modified depending on the requirements of the user but still has a certain degree of general validity. The paper wants to give organizations of the third sector in Germany an instrument they can use to increase the loyalty of their volunteers to the organization and thus the probability that they will remain there long-term.

Does Morocco Have a Future as A Production Location for the European Clothing Industry?

For a few years, European clothing manufacturers have been facing a great challenge with the trend of "fast fashion." Not only do they have to produce small, changing collections with short development and production times cheaply, but they also have to bring the products to the fashion market quickly and with short delivery times.

In view of the global competitive situation of Morocco in comparison to other emerging countries that are competing with even lower average labor costs in some cases, the geographical proximity to Europe is a great benefit for the North-African country. The transport routes are very short compared to Asian countries - the shortest distance is only 14 km. This factor and the Association Agreement with the EU or the trade treaty with Turkey have favorable effects on the production costs of the goods and make Morocco attractive for the textile and clothing industry as a production location. The competitiveness of Morocco is studied under different aspects such as logistics, employment and qualification structure, legal situation, and investment climate.

Economic Opportunities and Legal Problems of In-game Advertising

While computer and video games were consumed by a relatively small target group a few years ago (or at least it was presented this way in public), they now address a wide audience. This former niche product has become mainstream and is exciting across generations, genders, and income levels. Whether virtual bowling tournaments in the senior center, gripping football duels broadcast over the internet, or digital make-up parties during half-time, the composition of gamers is becoming more and more similar to the population structure.

Of course, advertisers have also noticed this development and large, worldwide companies such as Coca-Cola or Adidas have discovered the possibility of advertising in computer and video games (in-game advertising) as a marketing tool. This paper presents the different implementation forms, discusses critical success factors, and explains them using numerous examples. A second focus lies on the legal aspects of in-game advertising and possible developments for the future are discussed in the areas of competition law and child and data protection.

Regulation Concept for a Conversion of Debt to Equity (Debt-Equity Swap) in the Insolvency Plan Procedure

In light of the latest economic crisis that is still affecting at least parts of the economy, the instrument of debt-equity swaps (DES), which had been completely ignored up until just a few years ago, has attracted the eye of academics and consultants. DES is used as an instrument to save a business in economic trouble. The concept of DES is based on the "conversion of liabilities into equity." But, as simple and as tempting as this sounds, it is just as complicated to implement this instrument in many cases.

The objective of the paper is to create an understanding of a DES, first providing an overview of the typical procedure of a DES. Based on this, the paper describes the use of insolvency plan procedures as they take place in everyday consulting and business practice.

The author attempts to apply regulations of the discussed Law on the Reorganization of System-relevant Banks (KredReorgG) to businesses outside of the banking sector and develops an independent, industry-neutral regulation concept for a DES in the insolvency plan procedure.

Capital Market Investor Protection in the German and US Legal Systems – a Comparative Legal Analysis with Special Consideration of the KapMuG and the Securities Class Actions

The increasing interest of private investors in the "stock" investment class in recent years has repeatedly raised the question in legal scholarly discussions as to whether the legal protection provided by German law is sufficient to account for the changed investment behavior. The focus of the public has been on the aspect of investor protection, not lastly due to the current economic crisis.

The paper provides an overview of the existing liability system for incorrect or omitted capital market information in the German capital market law. The current legal situation is discussed critically, and as a consequence, there is a demand for improvements to be made to the Capital Market Information Liability Act (KapInHaG) by legislators.

In this context, the paper presents a draft of a KapInHaG, which has so far not been enacted, and it examines the purpose of introducing such a law.

The author outlines a practical solution by making a comparison to the investor protection laws in the USA, which are considered exemplary, while comparing the German Capital Investors' Test Cases Act (KapMuG) to the American system of securities class actions.

Anti-trust Barriers of the Brand Licensing Contract

An Analysis of the German and European Anti-trust Law under Special Consideration of Competition-Restricting Agreements

The relationship of commercial copyrights - for instance trademark rights – and anti-trust law has been fraught with tension since these legal areas have arisen. The conflict between the exclusive rights of industrial property on one hand and the free market access of anti-trust law on the other remains very topical today. In the area of licensing contracts, this tension appears particularly strongly and is the most visible in practice.

This paper deals with the question to what extent brand licensing contracts can be affected by the anti-trust barriers of German and European law – the ban on competition-restricting agreements, the abuse of a market-dominating position, and merger control. The focus here lies on the question of what brand licensing clauses represent competition-restricting agreements.

The literature discusses the tension between industrial property and anti-trust law mainly within the framework of patent licensing. By comparison, brand licensing contracts are treated somewhat disdainfully. But licensing contracts particularly lend themselves to the misuse of trademark rights in order to restrict competition. For this reason, licensing anti-trust law - the anti-trust content control of licensing contracts - plays a special role in the design of a brand licensing contract. The difficulty is that there is a tremendous amount of legal uncertainty in this legal area. The jurisprudence in non-uniform and supreme court decisions has mainly concerned industrial property rights other than trademark rights. The opinions in literature differ widely and there is no block exemption regulation for brand licensing contracts. By going through the research and jurisprudence, this paper develops insights and potential solutions for the area of licensing anti-trust law.

Leasing According to German and Islamic Law 

In an era in which banks are reserved when granting loans, leasing stands out as a helpful financing form. Due to its balance sheet neutrality and tax benefits, leasing is particularly popular among businesses. This financing form makes it possible for companies to react flexibly to business requirements that are changing ever-faster and more frequently. It also embodies a quick form of financing for private individuals. In Islamic regions, leasing is offered with a few differences to the western leasing model. So the question arises whether Islamic leasing could not be offered in Germany. This book illustrates both Islamic leasing and German leasing norms and discusses and compares the two forms. An essential point in Islamic leasing is the prohibition of interest. The vivid presentation of the framework conditions needed for offering leasing in a manner that is compliant with Islam uncovers a variety of different variants of leasing. It is possible to clarify the parallels between German and Islamic leasing. In this context, readers are given the opportunity to take a look at the basic principles of the Islamic financing system and understand its functionality. Within this framework, the tools and adjustments are shown that could ease the introduction of Islamic leasing to the German market. The result of the paper is that changes to certain tool kits in Germany can help Islamic leasing establish itself in Germany. Since Germany has 3.2 million Islamic citizens, it is possible to develop the Islamic market in Germany in a targeted manner. This would make is possible to offer financing products that are compatible with the religion of this customer group and thus would be considered as particularly interesting by this customer group.

ISBN: 978-3-942555-11-1

Talent Management

Hardly a day goes by without the media mentioning the keywords skilled worker shortage, talent drain, and migration of foreign skilled workers. The perceived discussion is multi-layered and will not be able to derive a correct solution. However, it can already be determined at this point that the shortage of skilled workers cannot be satisfied just from abroad and there has to be a (re)turn to the domestic market.

But how to win the best talent for yourself? Business have been facing this challenge for a long time, but the question is increasingly becoming an existential issue for businesses. Some industries, such as investment banks and law firms, have been trying for years to get and keep the best talent with industry-leading salaries; however their efforts have only led to partial success since, as they say, money isn't everything. So other ways have to be found to win over motivated and talented employees and tie them to the company in the long term. This has to be done in a structured process and not just based on sheer luck – as talent management

This is where this paper comes in, which was submitted as a diploma thesis in the summer semester 2010 at Faculty 3: Business and Law of the University of Applied Sciences Frankfurt am Main. The author clearly presents what requirements generation Y has for their professional environment and how a business structure can be developed on a permanent basis that satisfies the needs of the employees and ensures that the businesses remain competitive.

The work does not stop with purely theoretical considerations, but gives the floor to six business experts from the areas of personnel development to explain their understanding of talent management in all stages of the employee experience. One could only hope that this paper can give HR managers in businesses and employees at the start of and during their professional careers valuable ideas for a personnel culture which not only manages talent but leads to joint success for employees and business.