In a bid to make German courts more attractive for international dispute resolution, Germany is considering creating more English-speaking commercial courts — a move that could lead to increased demand for English-German translation services.
Germany’s Federal Ministry of Justice, known as the BMJ in German, published “Guidelines for the strengthening of the courts in commercial disputes and for the introduction of (English speaking) commercial courts” in January 2023.
While English-language chambers currently exist in certain cities — notably Stuttgart and Mannheim, which started operating them in November 2020 — the proposal would bring such courts nationwide, and would allow all proceedings, including final decisions, to be conducted in English.
In Germany, there is no automatic right to present evidence in court in English, although hearings can be held in English without an interpreter, if the parties and the court agree.
But, as German attorney Dr. Jürgen Mark wrote in a February 2023 blog post on the Guidelines, even in those situations, all written submissions to the court, the minutes of the hearings, and court decisions must be in German.
For large commercial disputes, the Guidelines would also authorize federal states to set up, as an alternative to district courts, special commercial courts where parties would be able to choose English language proceedings from the start.
The key proposed changes would also allow federal states to expand the use of English to all proceedings, including the court decision, for certain commercial litigation before select courts.
In English-language cases, judgments at all levels of court would be translated into German and then published, in order to improve the enforcement of rulings.
Language, Alone, Might Not Be Enough
Since the Guidelines intend to galvanize Germany as a competitor to nearby business centers such as Amsterdam, Paris, and — especially in the wake of Brexit — London, they go beyond simply introducing English into the courts.
In particular, the Guidelines set out to stack these special commercial courts against typically shorter arbitration proceedings by means of a process for shortening proceedings for disputes valued over EUR 1m. But arbitration has more than just speed going for it.
“In arbitration, [parties] can choose their own judges, can schedule their own proceedings and can then enforce the award in 172 different countries,” wrote King & Spalding LLP partner Jan K. Schaefer and associate Rüdiger Morbach in a March 2023 article.
“None of these advantages come with the proposed English-language proceedings,” they added.
Perhaps more fundamentally, until Germany can guarantee a critical mass of judges proficient in legal English and in high-profile commercial disputes, expanding English-language proceedings in German courts may not make much of a difference.
According to Mark, “In view of the major challenges the German government is facing, it remains to be seen whether English-speaking Commercial Courts will remain an important concern for the government and the Guidelines will be followed by a draft bill before the end of this legislative period.”