Germany A Acceptance of inheritance Administrator ( Nachlasspfleger ) Applicable law Apostille

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1 Germany This glossary is intended primarily for solicitors whose client dies in Germany, leaving property there. The significant differences between common law and civil law often frustrates attorneys due to the fact that it at times is incredibly difficult to identify equivalent legal concepts. This glossary contains a small working vocabulary and definitions for important or frequently encountered legal concepts, including some idioms useful when dealing with German probate law. A Acceptance of inheritance Like in most continental jurisdictions German law requires the inheritance to be accepted by the beneficiary. But: German law simply assumes the inheritance is accepted unless it is disclaimed properly and timely. The time-limit in most cases is only six weeks, in cases where the decedent or the beneficiary concerned live abroad, it is six months. The heirs are responsible for determining whether an inheritance is worth accepting or should better be disclaimed. Certain acts (e.g. disposition of estate assets or application for a certificate of inheritance) may imply acceptance even before the disclaimer period expires. An inheritance may only be accepted or disclaimed in its entirety. Once an inheritance is accepted it can no longer be disclaimed. However, the heir may later revoke the acceptance if he can prove that he was unaware of estate debts and in view of these unknown estate debts the estate is insolvent. Administrator (Nachlasspfleger) Under German law there is no statutory administration of the estate by an executor or administrator. The estate directly passes to the heirs upon the death of the decedent and, if there is no executor, the estate is administered by the heir or if there is more than one heir the community of co-heirs. However, if the heirs are unknown, haven t accepted the inheritance yet or if their shares are uncertain, the probate court may, upon application, appoint an administrator, who will secure the estate. Applicable law The applicable law of succession and estate administration is determined by the citizenship of the decedent at the time of his death regardless of domicile. From August 17, 2015 on, the Regulation (EU) No 650/2012 will be in force and change that: According to this Regulation the applicable law will be determined by the last habitual residence of the decedent. If German conflict of law requires reference to the law of a foreign country, this reference includes the conflicts of law rules of that country. If the foreign law refers back to German law, German internal law applies. As an exception to the principle of unity of the estate, German courts apply the law of the situs with respect to immovable property located in England & Wales (and other common law jurisdictions). Apostille Germany is a member state of the 1961 Hague Convention abolishing the Requirement of Legalization for Foreign Public Documents. The Convention provides for the simplified certification of public (including notarized) documents to be used in countries that have joined the convention: The "Hague Apostille" certificate confirms the authenticity of a public document, the original of which must be submitted to the designated authority.

2 C Central wills registry In 2012, Germany started to create a central will registry which is managed by the chamber of German notaries (Bundesnotarkammer). The central wills registry is currently digitalizing information provided by the German civil registers (Standesamt) who are currently responsible to inform German probate courts about the registration of a will. The central wills registry is planned to be operating fully in Next to notarial will also inheritance contracts and other documents with influence to the inheritance of an individual are registered (e.g. contract to waive the right to inherit from mother or father and certain marriage contracts). Holographic wills may be registered only if handed over into court custody. The will registry only records where the Testator resides and where his/her inheritance documents are kept. The original will is kept at the notary s office where it was furnished or taken into court custody at the local court where the testator resides. During the testators lifetime nobody but him can request informations from the central wills registry. Only German courts and notaries are entitled to make a will search. The will search is free of charge. Certificate of executorship (Testamentsvollstreckerzeugnis) The German certificate of executorship certifies the identity of the executor. Furthermore, it shows any limitation to the powers of the executor. Pursuant to 2365 BGB it is presumed that the person named in the certificate as executor has the power to dispose over all estate assets without limitations other than those stated. Certificate of inheritance (Erbschein) The Certificate of Inheritance confirms the identity of the heir. Should there be more than one heir, the Certificate will identify the respective share of the co-heir in the estate. Furthermore, the Certificate shows any limitations to the heir's power of disposition over the estate. There is a presumption that the person identified as heir in the certificate of inheritance has the right of inheritance stated therein and is not subject to limitations other than those stated. Additionally, 2366 BGB protects those who acquire an item belonging to the estate from the person named as heir in the Certificate in good faith. They obtain title even though the transferor is not the true heir, unless they had knowledge of the inaccuracy of the certificate. The Certificate does not show if there are persons entitled to the statutory forced share or to a specific bequest. Charities Gifts to certain institutions of welfare, education or religion are exempt from inheritance tax. Foreign institutions of welfare are only exempt if the foreign country grants the same benefit to comparable German institutions. Civil partnership Germany allows registered partnerships (eingetragene Lebenspartnerschaft) only for same-sex couples. These registered partnerships provide nearly all of the rights of marriage except joint adoption and full income tax benefits. Inheritance tax benefits are fully available. Clawback (Pflichtteilsergänzungsanspruch) Persons entitled to a German forced share are entitled to request additional payments if the deceased gifted property during his lifetime. However, only gifts in the last 10 years prior to death are relevant and even those gifts will not fully be taken into account. If the donee is the spouse of the deceased or the donor retained an interest in the gift, the 10 year period fails to commence. The persons entitled to clawback may waive their rights during the life of the donor by notarized contractual agreement. Civil registration office (Standesamt) Germany has no central repository for civil records of births, marriages and deaths. Records of birth, marriage and death are generally kept at the local civil registration office (Standesamt) where the event occurred. Divorce judgements are kept with the the court where the divorce took place.

3 In order to obtain a death certificate, marriage certificate or birth certificate you should contact the local civil registration office where the person was born, married or died. The local registration office generally requires the full name of the individual as well as his/her specific date of birth, marriage or death, in order to facilitate a quick and easy search. Additionally, you will have to prove a legitimate interest (e.g. that the person predeceased and thus is not an intestate heir). Codicil Wills may be amended by codicils. A codicil must be executed in the same manner as a will. Community of co-heirs If there is more than one heir there is a community of co-heirs. If there is no German executor, the coheirs jointly administer the estate. In principle, any act of administration requires unanimous decision of the co-heirs. Every co-heir is obliged to give his consent to measures that are necessary for the proper administration of the estate. If one co-heir refuses to give his consent to such measures of administration, a court may substitute his consent on application of a co-heir and he may be liable for any losses that are caused by his refusal for consent. In principal the co-heirs represent the estate jointly. However, each co-heir may claim performance to all heirs from any debtor. In cases of emergency every co-heir is entitled to act on behalf of the community of co-heirs. Dispositions of estate assets always require the unanimous consent of all co-heirs (see 2040 BGB). Every co-heir has the right to demand distribution of the estate after estate liabilities are paid. Distributions are made on the basis of a distribution agreement which requires the consent of all co-heirs. If one or more heirs do not agree, consent may be replaced by court order. D Debt liability Under German law, heirs (see Heir) inherit both assets and debts at the time of death. Heirs are personally liable for decedent's debts and liability is in principal not limited to the estate. In order to avoid personal liability for decedent's debts the heir can disclaim the inheritance or apply for insolvency of the estate. Pursuant to 2058 BGB, co-heirs are jointly liable for estate debts. Each co-heir is liable for the estate debt separately. Until the distribution of the estate, heirs may limit their liability to his or her share of the estate (see 2059 BGB). After the distribution of the estate, each co-heir is liable for the part of the estate debt that corresponds to his share of the inheritance (see 2060 BGB). Court of Protection The German equivalent to the Court of Protection is the Betreuungsgericht, which is a specialized subdivision of the ordinary local courts (Amtsgericht). Death registry There is no German equivalent to the General Register Office in England and Wales. Death certificates, marriage certificates and birth certificates can be obtained from the (local) civil registration office. Disclaimer of inheritance (Ausschlagung) As the heir is liable to the debts of the decedent (debt liability in Germany), an heir may seek to disclaim an inheritance in the case that the estate is indebted. The heir may disclaim the inheritance by making a declaration (Disclaimer) to the probate court for the purpose of authentication, or by a certified authentic declaration in front of a German probate court, a German notary or a German Consul. The general deadline for renunciation is 6 weeks, and 6 months if, among others, the last residence of the deceased was exclusively abroad. An inheritance may only be accepted or renounced in its entirety. Once the heir has accepted the inheritance (see: Acceptance of inheritance) he cannot renounce the inheritance. Upon

4 renunciation of the inheritance, the next in line will receive the estate, unless the decedent provided for an alternative distribution in his will. Usually the children will be next in line and will inherit the share of decedent s debts unless they also disclaim the inheritance. However, the parent of a minor child or one parent with full custody may disclaim in the name of the child if the child only inherits because the parent disclaimed the inheritance. Domicile The concept of domicile, as understood under English law, does not exist in German civil law. However, if German conflicts of law refers to English law (e.g. because the deceased was a British Citizen) this reference also includes English conflicts of law. If English law refers to German law because of the domicile of the decedent, Germany will accept the reference and German law will apply. E Evidence of foreign law German courts can apply foreign law. If the foreign law cannot be determined by the court, the court may obtain an expert opinion from an attorney who specializes in foreign law at issue. Most German courts have some knowledge of English inheritance law. E.g. most German courts know that a typed will, signed by the testator and witnessed by two persons is valid under English law (and, thus, recognized in Germany). Executor of the Estate (Testamentsvollstrecker) The German equivalent of an executor of the estate is called Testamentsvollstrecker. He is called to execute the testamentary dispositions of the deceased. Unless otherwise provided by the testator, his tasks include the administration ( 2205 BGB) and the distribution of the estate (see 2204 BGB). In contrast to England and Wales, there is no mandatory administration of the estate by an executor (an administrator of the estate is not even recognized in Germany) and in most cases the heirs or the community of co-heirs administer the estate. F Forced share The children (or their offspring if they are predeceased) of the deceased, the spouse of the deceased and - if there are no children (or offspring) - the parents of the deceased are entitled to a forced share. The forced share amounts to one half of the value of the intestate share, 2303 I 2 BGB. The forced share is a claim in money against the heir or the community of co-heirs and there is no right to administer the estate. Foreign wills Germany is a member state of the Convention of 5 October 1961 on the Conflicts of Laws Relating to the Form of Testamentary Dispositions (Hague Testamentary Dispositions Convention). Thus, a will is valid if its form complies with the internal law: a) of the place where the testator made it, or b) of a nationality possessed by the testator, either at the time when he made the disposition, or at the time of his death, or c) of a place in which the testator had his domicile either at the time when he made the disposition, or at the time of his death, or d) of the place in which the testator had his habitual residence either at the time when he made the disposition, or at the time of his death, or e) so far as immovables are concerned, of the place where they are situated. Consequently, most foreign wills are formally valid from a German perspective and it is not mandatory to create a separate will for German assets. However, is may be advisable to make a separate will for Germany as the legal concepts differ significantly and a German will may facilitate estate administration.

5 G Gift inter vivos (Schenkung) A contract by which a gift is promised must be notarized. Otherwise it is invalid. A defective form is cured by rendering the performance promised. If the donor, after making the gift, cannot provide for himself or other dependent persons, he may revoke the donation and claim back the gift from the donee. Gifts may be added to the calculation basis for the forced share (see: Clawback). H Heir: Under German law, the estate passes directly to the heir upon the death of the deceased. If there is more than one heir, the estate passes to the community of co-heirs. An heir is generally a beneficiary who receives the entire estate or a part of it and who is liable for estate debts. If a person is only entitled to receive certain assets, this person is generally not an heir and generally is not liable for estate assets. Unless there is an executor the heir or the community of co-heirs administer the estate. Other persons like the devisee of a specific bequest or the person entitled to the statutory forced share, only has a personal claim against the heir. I Inheritance tax unlimited tax liability Unlike the UK IHT the German inheritance tax ("Erbschaftsteuer") is levied on the beneficiary s acquisition upon death (even if not distributed) and not the undivided estate. The worldwide acquisition (irrespective of the situs) is taxed (unlimited inheritance tax liability), if the deceased or the beneficiary had his habitual abode or residence in Germany. A taxpayer has a permanent home in Germany if he possess a home in Germany under circumstances from which it can be assumed that he will keep this home and use it ( 8 German General Tax Code). This home does not need to be his principal home. A habitual abode is held if somebody stays at a place (e.g. a long-term rented hotel suite) under circumstances from which it can be assumed that his stay at this place is not only temporary. In addition, the worldwide estate is taxable in Germany, if the deceased was a German national and was a resident tax payer the last 5 years before his death. Inheritance tax situs taxation In addition to the unlimited taxation principals discussed above, certain assets can be taxed in Germany if they have a German situs such as real property located in Germany. German bank accounts are not subject to taxation because of situs. Inheritance tax tax rates The tax rate of the German inheritance tax depends on the tax class of the beneficiary. The tax class depends on the family relation between the deceased and the beneficiary. For example, the tax rate of the children of the decedent starts at 7 % and tops out at 30 %. The tax rate for a non-family member starts at 30 % and goes up to 50 % depending of the value of the acquisition. Inheritance tax - tax allowances The tax allowance of the German inheritance tax depends on the tax class of the beneficiary. The tax class depends on the familial relationship between the deceased and the beneficiary. The tax free allowance for the spouse of the deceased amounts to EUR 500,000 and the tax free allowance of each child amounts to EUR 400,000, whereas siblings of the decedent, their offspring or non-family members only have an allowance of EUR ,--.

6 Intestacy rules If the deceased's spouse is still alive at the time of the deceased s death, the spouse's share of the estate is to be determined first. According to 1931 BGB the surviving spouse of the deceased is entitled to receive: 25% of the estate if there are any surviving children (or their issue) of the deceased 50% of the estate if the deceased is survived by his/her parents or their issue (i.e. sisters/brothers or nieces/nephews of the deceased) or grandparents 100% of the estate if the deceased is not survived by any of the aforementioned relatives The share of the surviving spouse is modified depending on the matrimonial property regime of the spouses. In the case of the statutory property regime of community of surplus the surviving spouse's intestate share is increased by one fourth as a lump sum for the regular equalization of the surplus (see 1931 III, 1371 I BGB). After the share of the spouse has been deduced from the estate, the shares of the other beneficiaries are determined. As in most jurisdictions the relatives of the deceased, especially his issue, are the first to claim inheritance rights. If there is more than one relative of the deceased, the following principles apply. First the class of the inheritance right has to be determined ("Ordnung"). Any beneficiary of a foregoing class excludes any potential beneficiary of a higher class (see 1930 BGB): Class one (see 1924 I BGB): issue of the deceased and their issue, e.g. the children, the grandchildren and great-grandchildren of the deceased. Class two (see 1925 I BGB): the parents of the deceased and their issue, e.g. the brother or sister, nieces and nephews of the deceased. Class three (see 1926 I BGB): the grandparents of the deceased and their issue, e.g. uncles, aunts and cousins of the deceased. Within the same class, inheritance rights are determined as follows: First class: According to 1924 IV BGB the issue of the deceased inherits in equal shares. Living children of the deceased exclude the grandchildren of the deceased from any inheritance rights. They are represented by their father / mother ("principle of representation"). Where one of the deceased's children has died before the deceased, the deceased child's share passes over to his children ( 1924 III BGB). If the issue of de deceased had more than one child, each of his children inherits an equal share ( 1924 IV BGB). Second class: If both parents are still living at the time of the deceased`s death, they inherit the estate in equal shares excluding all other members of their class ( 1925 II BGB). If one parent has died before the deceased, his share of the estate passes to his issue (see 1925 III 1 BGB). If the pre-deceased parent does not leave any descendants, his share falls to the surviving parent (see 1925 III 2 BGB). If both parents of the deceased have died before him, each of the parents' shares passes to their issue. Third class: If all grandparents are still living, they inherit in equal shares excluding the other members of their class ( 1926 II BGB). When at the time of the deceased death one of his grandparent had predeceased, his share passes over to his issue. If the deceased grandparent had no issue, his share passes over to his spouse or the spouse s issue. If the spouse predeceased and had no issue, the other pair of grandparents or their issue receives their share (see 1926 III, IV BGB). Fourth or higher classes: succession is determined by the degree of relationship. The degree of relationship is determined by the number of intervening births ( 1589 S. 1BGB). If there are several relatives of the same degree, they inherit equal shares ( 1928 III, 1929 II BGB). Inventory An estate inventory (Nachlassverzeichnis) is required in many situations. For example, an inventory is required when the court seeks to calculate it s fees for issuing a certificate of inheritance or because the forced heirs ask the testamentary heirs for an inventory as a calculation basis for the forced share. Depending on the reason, the content of the inventory varies. In some instances (e.g. in case that there is an executor of the estate) one can ask a notary to draft the inventory.

7 J Joint tenancy There is no equivalent of the common law concept of joint tenancy in Germany. Property can only be acquired in Germany as co-owners. On the death of one co-owner, the share does not accrue automatically to the survivor (see 'Tenancy-in-common' below). Joint will (Gemeinschaftliches Testament) Spouses or same sex living partners can make a joint will. A joint will is generally made on one document. It must be signed by both spouses / living partners. However, only one spouse / living partner will generally write it (by his own hand). Many joint wills contain mutual dispositions upon death (mutual will). Such mutual dispositions may limit the freedom to make or change a will. Jurisdiction of German Courts Unless a treaty provides otherwise, jurisdiction is determined by domestic German law. Accordingly, a German court has international jurisdiction whenever it has jurisdiction according to the provisions of the Code of Civil Procedure (ZPO). Pursuant to 12 ZPO (General venue; term), the court within the jurisdiction of which a person has his general venue is competent for all (contentious) actions that may be brought against that person, unless an exclusive venue has been established for court actions. Alternatively, the claimant may choose to initiate an action in the court in which the testator had his general venue at the time of his death, 27 ZPO (Specific jurisdiction of an inheritance). If the deceased is a German citizen who had no general venue in Germany at the time of his death, the court at the last place of residence in Germany has jurisdiction, 27 II ZPO. If the deceased is a German citizen who never had a residence in Germany, the local court of Schöneberg in Berlin has jurisdiction. Special rules apply for non-contentious probate proceedings. L Land Registry (Grundbuch) There is no nationwide land registry in Germany. The land registry is a special division of the local court (Grundbuchamt beim Amtsgericht). The land registry shows the names of the current and previous owners, third party rights in rem (e.g. mortagage), discription of the property The land registry may be accessed only by persons who can prove a legitimate interest (e.g. forced heir, creditor). Those persons may also apply for an extract from the land registry. There is no public internet search tool. However, German notaries can request information online. Changes of rights to land do not take effect before being registered in the land registry ( 873 BGB). Some exceptions apply (e.g. the heir becomes owner of a property even if he is not registered as owner in the land registry). Until otherwise proven, the correctness of all titles recorded on the register is assumed and a buyer can rely on the correctness of the land registry ("public faith", 892 BGB). A buyer of a property in Germany will be guided through the registration process by a German notary or a German lawyer. An heir needs to provide a certificate of inheritance or a will notarized by a civil law notary in order to get registered as owner in the land registry (which is generally a precondition for selling the property), 35 German law on the land registry (GBO).

8 Lasting powers of attorney Under German law it is possible to appoint an agent to make decisions on a person's behalf, when that person lacks the mental capacity to do so. This appointment can even be used to administer the estate if it is stipulated that it does not end with the death of the principle (Vollmacht über den Tod hinaus). Letters of administration There is no equivalent of letters of administration in Germany as inheritance and distribution of the estate are achieved by the beneficiaries without court intervention. The courts will only intervene in the event of disagreement between the beneficiaries. There is no designated probate division in the German court system, and there is no procedure that specifically corresponds with probate or grant administration. M Matrimonial property regime The matrimonial property regime is a set of mandatory rules which apply automatically to all married couples in Germany. The regime outlines their minimum duties and rights in respect of the managing of assets and the administration of their estate. There is no equivalent in England and Wales. According to 1363 BGB (German Civil Code), the spouses live under the property regime of community of accrued gains (Zugewinngemeinschaft) if they do not agree otherwise by marriage contract. In this case, the property of the spouses before marriage does not become the common property. The same applies to property that one spouse acquires after marriage. However, the gains accrued during the time of marriage (except from donations and inheritances) are equalized when the community of accrued gains ends (e.g. by death or by judgment). In case of intestacy, the gains are equalized by augmenting the intestate share of the surviving spouse by ¼ of the estate (see Intestacy rules). Mutual will (Gegenseitiges Testament) A testamentary disposition in a joint will is mutually connected with another testamentary disposition if it would not have been made without that disposition (see 2270 I BGB). According to 2270 II BGB, unless otherwise provided, it is presumed that a testamentary disposition is mutually connected to another testamentary disposition if the estate shall pass over to the surviving spouse and after the death of the surviving spouse to a relative or otherwise related person (e.g. friend) of the first dying spouse. According to 2270 III BGB, 2270 I BGB does not apply to dispositions other than those concerning the appointment of heirs, testamentary bequests or testamentary burdens. Any other testamentary disposition, e.g. regarding the administration of the estate, is not mutual. If a mutual testamentary disposition is revoked or invalidated, the corresponding testamentary disposition is invalid as well (see 2270 I BGB). During the lifetime of the other spouse, each spouse may revoke his own disposition by informing the other testator by way of notarial letter. After the death of one spouse, mutual testamentary dispositions of the other spouse can, in principle, not be revoked anymore and are binding. However, if the surviving spouse renounces the inheritance, he is free to change his will ( 2271 II BGB). N Notary German notaries are highly qualified lawyers who focus their practice on non-contentious private civil law. Their participation is required under German law in certain cases. Specifically, cases involving important agreements with long-term effects and particular economic or personal significance for the parties concerned ( e.g. transfer of title to real estate, incorporation of a limited liability company or a public corporation, prenuptial agreements and inheritance contracts) often require the participation of German notaries. Without a notarization, such agreements are void. The justification for mandatory involvement of notaries is the theory that it protects the parties from rushing into such agreements without first obtaining proper legal advice. Additionally, the involvement of a notary can ensure proper documentation and preservation of such agreements.

9 In contrast to a German attorney at law (Rechtsanwalt) who is an advocate for his client, a notary is neutral and must comply with the German law governing notarization (Beurkundungsgesetz). Under this law, the notary must advise all parties involved and ensure that they have understood all the implications and warn a party if the notary thinks that such party is entering into a disadvantageous or harmful agreement. German notaries hold public office. Nevertheless, notaries operate typically, but not always, in private practice. The mode of practice depends on the state (Bundesland). In some German states, notaries practice exclusively as a notary (Nur-Notar). In others they are practicing simultaneously as an attorney and notary (Anwaltsnotar). In Baden-Württemberg the notaries are public servants (Beamten-Notar) and are regularly staffed in government agencies and offices. In some parts of Baden, notaries are also competent to issue certificates of inheritance (Amtsnotar). Most German notaries do not receive a salary from the state. Instead, he or she charges fees to the parties. Such fees are fixed by law (GNotKG) and depend on the value of the matter. In case of negligence, a notary is personally liable for all damages caused. Liability insurance is mandatory for all notaries. Furthermore, the regional chambers have established a special fund for damages that are not fully covered by the liability insurance. All German notaries are subject to the supervision by the President of the competent district court (Landgericht). Negligence and non-compliance with the German law governing notarization or the professional conduct code (Bundesnotarordnung) can also result in disciplinary actions and sanctions. In addition, all notaries are subject to a regular review of their files and their practice by the supervising authority. Additional information is available on the website of the Bundesnotarkammer. P Payable upon death account (Vertrag zu Gunsten Dritter) Under German law, a person may name somebody as beneficiary of the balance of a bank account in the event of his death (Payable on Death Account). The entitlement generally overrides the will. However, under certain conditions, the heir may have the right to claim the funds from the beneficiary. Payment to the beneficiary may also result in claims of a forced heir. Probate Records Germany Probate records in Germany are kept with the local probate court at the place of the last residence of the deceased (Nachlassgericht). They are not public and anybody who requests information from the German probate records will have to prove a lawful interest (e.g. potential heir or forced heir). Probate records include various types of documents and files, including Estate inventories Wills and inheritance contracts Application documents Affidavits Certificate of inheritance or certificate of Executorship R Rechtsanwalt German lawyers are known as Rechtsanwalt. The legal profession in Germany is not divided between barristers and solicitors. All German lawyers are permitted to exercise their profession in all German courts (except the Supreme Court - Bundesgerichtshof -, where only 46 (January 2015) elected attorneys

10 are permitted to practice exclusively). They are supervised by the Rechtsanwaltskammer. They have to ascertain confidentiality. Correspondence between German lawyers and their clients is privileged. They are required to keep separate office and client accounts and to follow the rules of professional conduct. Recognition of foreign decisions in Germany in inheritance matters The recognition of foreign succession law judgments is determined by 328 ZPO (German Procedural Code) - Recognition of foreign Judgments. Final foreign court decisions generally are recognized as long as the exceptions stated in 328 ZPO do not apply. Pursuant to 328 ZPO a foreign judgment cannot be recognized if: 1. The courts of the state to which the foreign court belongs do not have jurisdiction according to German law; 2. The defendant, who has not been heard and who takes recourse to this fact, has not duly been served the document by which the proceedings were initiated, or not in such time to allow him to defend himself; 3. The judgment is incompatible with a German judgment, or with an earlier judgment from a foreign court, that is to be recognized, or if the proceedings on which such judgment is based are incompatible with proceedings that have become pending earlier in Germany; 4. The recognition of the judgment would lead to a result that is obviously incompatible with essential principles of German law, and in particular if the recognition is not compatible with the German constitution; 5. Reciprocity has not been granted. This does not contravene that a judgment can be recognized if the judgment concerns a claim, that is not in money and German Courts had no jurisdiction. In view of these vast exceptions, in most cases foreign decisions in inheritance matters cannot be recognized in Germany unless there is a treaty which facilitates the recognition of foreign judgments. Such treaties are in force with Spain and Turkey. The European Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters does not apply with regard to rights in property arising out of a matrimonial relationship, wills and succession, Art. 1 Nr. 2 lit. a EC. The European Succession Regulation, which will come in force on August 17th 2015 will change this. The recognition of foreign grants of probate or administration in non-contentious matters is not determined by the German procedural code but by the German Act on the Procedure in Family Matters and in Matters of Non-contentious Jurisdiction (FamFG). Pursuant to $ 107 FamFG, foreign judgments are generally recognized in Germany. However, German courts have ruled that a foreign grant of probate or administration is no judgment in the meaning of 107 FamFG and, thus, cannot be recognized in Germany (see OLG Bremen, decision dated W 6/11). Instead, the personal representative or the heir will have to apply for a German certificate of inheritance or a certificate of executorship. Revocation of the will The testator may at any time revoke or modify a will or part of a will (see 2253 BGB). A will or part of a will is revoked only by - making another will that contradicts the old one ( 2254, 2258 BGB), - making a will that explicitly revokes the old one, - destroying (e.g. burning, tearing) or marking (e.g. by crossing it out) the document with the intention to revoke the will ( 2255 BGB) - in case of a notarial will: by withdrawal of the will from official custody ( 2256 BGB). If revocation is made by will, the revocation itself may be revoked (e.g., by destruction); in this case the original will is effective again (see 2257 BGB). The right to revoke a will may be limited by way of a contract of inheritance or a joint will. In case of divorce, there is a presumption that the testator wanted to revoke the dispositions in favour of the spouse. However, the spouse may prove that it was not the testator`s intention to revoke the will in case of divorce.

11 S Solicitors Accounts Rules Under 43 a V 1 BRAO a registered German lawyer (Rechtsanwalt) is required to keep client money safe and pay out client funds to the client or to a trust account (Rechtsanwaltsanderkonto) without delay. Subsequent heirship In some cases the testator may wish to have an influence on the fate of the inheritance after his death, e.g. because he names his second wife sole heir but does not want that she passes the estate to her children from a prior marriage. In order to achieve this, the testator may provide that the estate first passes to the preliminary her (Vorerbe) and upon a certain condition to the subsequent heir (Nacherbe), 2100 BGB. T Tenancy-in-common All co-ownership under German law is held under tenancy-in-common, so the deceased's share of the coowned property will be part of his estate and will pass in accordance with the terms of his will or intestacy. Trust The concept of trust is basically unknown in German civil law and German property law does not recognise the transfer of assets located in Germany to a trust. However, there are German legal concepts that may have the same effect. For tax purposes, certain trusts are deemed to be legal entities and transfers to such trusts are taxed at a rate of up to 50% (if there are ties to Germany). Distributions are taxed as a gift, however, in most cases at a more favourable rate. U Universal Succession (Germany) In contrast to common law legal systems, the property of the deceased passes in its entirety to the heir or the community of co-heirs (this is called the principle of universal succession ), 1922 BGB. W Will Generally, under German law the testator is free to determine the distribution of his property upon his death by means of a testamentary disposition (testamentary freedom). The testator is free to appoint heirs and to assign shares in his estate as sees fit. A testator is also free to modify or revoke a testament prior to death. The testator can choose between two forms of regular wills: the public will, and the holographic will. Spouses and registered same sex life partners can make a joint will. A holographic will must be made entirely by the own handwriting and signature of the testator. A will which was written on a typewriter or computer is not handwritten even if it was signed by the testator. The signature of the testator must be made following the end of the text of the will and must be made by the testator in person. The testator should state the time and the place where he made the will. However, if the testator fails to do so, the testament is still valid, if time and place can be otherwise ascertained. The signature should contain the first name and the surname of the testator. However, if the testator fails to do so, the testament is still valid if the identity of the testator can be determined without doubt on the grounds of his signature and it can be assumed that the testator had the serious intention to make a will. Codicils and additions to a testament must always be signed separately. Witnesses are not required for the validity of a holographic testament and will not result in a void testament.