English barristers, German lawyers and the aftermath of the mis-selling scandal

19 March 2015

German banking lawyers and English barristers analyse legal aftermath of mis-selling scandals

Hugh Mercer QC

Hugh Mercer QC
Vice-Chairman, Bar Council International Committee

In the heart of Frankfurt, on the site vacated some years before by the Nazi-sympathising IG Farben, stands a series of Bauhaus-inspired modern buildings which together form the Goethe Universitaet Frankfurt.

Dr Rolf Friedewald - whose title is not dean but managing director of the House of Finance - welcomes us warmly, keen to extend the links between legal business and the law section of his faculty. 

The International Committee of the Bar Council has teamed up with the Banking and Capital Markets Association of the Deutscher Anwaltverein to showcase at a joint seminar on 19 February 2015, the role of barristers in dealing with cases and regulatory issues arising from financial mis-selling in England and Germany.  But the key to the event is teamwork between the participants.  A telcon some months ago refined the topics and served as an introduction to the speakers who also exchanged their papers a few days in advance.

With a diplomatically worded introduction ably crafted in a blend of German and English by Christian Wisskirchen, Head of Policy: International, the point is clearly made to the fifty plus lawyers from a mix of law firms and in-house roles from cities in a two hour radius around Frankfurt that all have direct access to barristers for their legal advice.

The first session focuses on regulatory approaches in the two countries and highlights the differing understanding in the UK and Germany of the same EU directive, MIFID.  Hearing German views on a secret agreement negotiated by banks and the British Government in one field of mis-selling gives rise to a lively debate.  Case law is given pride of place in the second session as we learn that the principal regulatory obligations for financial products sold in Germany have been set out not, as one might expect in a code (as in FSMA), but in a series of decisions of the Federal Supreme Court starting with the "Bond" decision in 1993.  Moreover fundamental regulatory principles, such as restrictions on kickbacks due to conflict of interest issues, are given effect by the civil law in Germany, a development which has not yet been reached in the UK.

Though the content is subject-specific, the style is transferable to most fields:  first, long-range planning and discussion of topics to permit adequate publicity on both sides; second, short presentations on a comparative law basis informing overseas colleagues of the essence of the subject followed by lively discussion of the knottier issues;  third, true cooperation in the conception of the event avoids any impression of our parking our tanks on our colleagues' lawns; fourth, allowance of time for networking through early arrival, generous coffee break and a drinks reception to follow.

Sure, if the German colleagues are looking for contractual documentation according to English law for a swap transaction, they are likely to look to the London City law firms.  But for advice on prospects and strategy in contemplated litigation, this kind of event provides another string to their bow in the shape of the barristers they have met in Frankfurt.   The International Committee is not aiming to replace the activities of the British-German Jurists, Combar or indeed the European Circuit of the Bar from whom the blueprint for this event has been borrowed on the strength of thirteen years of experience flying the flag for the Bar around Europe.  However, by the time that the European Circuit runs its annual conference in Berlin in September 2015, the Bar's flag will have been clearly visible to a large part of the German legal community.

And meanwhile, preparations in the International Committee continue apace for a further foray into Europe, this time to Warsaw at later date in 2015.  The subject focus this time - as agreed with our Polish colleagues who recall an earlier visit by the European Circuit - will be criminal and family law.  A combination of high levels of Polish immigration to the UK and the lack of discretion given to Polish prosecutors with regard to European Arrest Warrants means that both topics are timely.  Though obtaining a speaking slot is a good reason to go, it should not be regarded as essential.  Well-chaired events permit interventions from the floor and networking time is assured.  If you were looking for a slightly different angle on your criminal or family practice, perhaps the cost of an overnight stay in Warsaw might serve as a catalyst for change. 

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