24 January 2023 | Hotel Schani Wien

On 21 April 2021, the European Commission (ECOM) published measures aimed at fostering sustainable investment and steering finance towards the European Green Deal.

31 January 2023 | University of Natural Resources and Life Sciences Ilse Wallentin Haus

In the world of finance, the rise of environmental, social and governance considerations has compelled bankers, investment professionals and banking and finance lawyers to reevaluate their mindset.

Environmental protection and climate change are by far the hottest topics in contemporary competition policy. The European Green Deal, signed by the EU 27, sets out to make Europe the first climate-neutral continent by 2050, where economic growth is decoupled from resource use.

Across the globe, more and more companies are looking into ways to strengthen their environmental, social and corporate governance ("ESG") profile as investors realise that a strong ESG profile is the key to safeguarding a company's long-term profit and growth.

In August 2022 the Hungarian Competition Authority (GVH) closed its accelerated sector inquiry into the market for insulation materials, providing recommendations to manufacturers, the public, waste management operators and the legislator, aiming for a decrease in product prices.

Sustainability is crucial for ensuring the long-term wellbeing of the planet and future generations. It encompasses responsible practices that preserve natural resources, mitigate climate change, and promote social and economic balance, ultimately creating a harmonious and sustainable world for all.

ESG ratings are all the rage these days, especially in the Polish banking sector. But there is still no one-size-fits-all methodology supervised by, for example, the European Banking Association. Instead, multiple rating institutions such as MSCI, Morningstar Sustainalytics, S&P Global and Sustainable Fitch, assess companies on their environmental, corporate governance and social attributes.

Greater interest in ESG and the energy transition may be observed recently throughout Europe, especially after the COVID-19 pandemic and the Russian aggression against Ukraine. The green energy transition has become not only a matter of climate protection but also of domestic security. As banks are one of the most important sources of external financing, they play a significant role in the transformation to a sustainable economy and can contribute towards mitigating adverse effects on the environment and society by key players in the global economy.

The world has seen a significant shift towards sustainable energy sources in recent years. One of the most promising and rapidly growing sectors in the renewable energy industry is offshore wind parks. These structures that use the power of wind over the open seas are quickly gaining popularity as part of the global effort to combat climate change. This article will explore the global trend of offshore wind parks and shed light on Montenegro's potential in this eco-friendly energy source with a special focus on fixed-bottom wind parks.

The issue of environmental crime has been addressed in international and European fora for many years. The most recent international event dedicated to environmental protection was the 5th EELF Annual Conference "Sustainable Management of Natural Resources – Legal Instruments and Approaches" held from 30 August to 1 September 2017 at the University of Copenhagen.

Proposed new legislation would introduce automatic permits for certain energy infrastructure projects (eg, electricity grids and power plants). According to the federal minister for digital and economic affairs, in order to maintain Austria's attractiveness as a business location and ensure sustainable development, comprehensive investment in its infrastructure is required. 

The draft of the Nature Restoration Law (NRL) unveiled by the EU Commission in 2022 and narrowly approved by the EU Parliament in July 2023, has been met with both enthusiasm and controversy. It sets lofty objectives for the Member States to restore ecosystems, supporting the unionwide and long-term sustainable recovery of biodiversity and nature's resilience. To achieve this, the NRL aims to establish binding restoration targets and obligations for various ecosystems. By 2030, these measures should cover at least 20 % of the Union's land and sea areas and extend to all ecosystems "requiring restoration" by 2050. To meet these goals, Member States must create and implement "restoration plans".

As we wrote in last year's edition, sustainability claims are "trendy but tricky", at least from the perspective of advertisers: On the one hand, there is social and economic pressure to offer green, sustainable, climate-friendly or even CO2-neutral products and services. On the other hand, one should avoid not only the accusation but also the legal consequences of engaging in greenwashing, i.e. misleading environmental advertising. This year, our slogan needs the following update: "Sustainability claims: trendy, tricky and soon to be expensive", as the EU Commission's latest proposal for a Directive on Green Claims foresees a strict regulation of environmental claims and labels. 

Montenegro's Law on Games of Chance (the "Law") was enacted in 2004 and has undergone multiple amendments since. The most recent ones came into effect on 1 January 2024. The aim of the amendments, as stated by the competent authorities, is to ensure a sustainable regulatory system for organising games of chance via the internet or other telecommunication means, as well as to generate additional revenue from these activities. This objective is to be achieved through measures aimed at establishing a variable concession fee for the organisation of online games of chance, a provision not envisaged in the prior legal framework in this area. Another measure to achieve the set goal is to introduce a ban on participation in foreign games of chance via the internet and other telecommunication means for which bets are paid on the territory of Montenegro.

Schoenherr advised Seven Refractories GmbH on the sale of its European, Indian and US operations to RHI Magnesita for a cash consideration of approximately EUR 93m. Closing is expected in the second half of 2023 and is subject to the fulfilment of customary regulatory approvals.

Schoenherr provided comprehensive legal advice to Austrian green tech scale-up neoom on the structuring and implementation of its "impact invest" customer financing scheme as well as related project debt financing in an amount of up to EUR 30m arranged by Solas Capital. The financing enables neoom to offer its customers long-term instalment purchase contracts for equipment related to decentralised energy projects, thereby improving the accessibility of energy efficiency and self-consumption PV technology for neoom's clients in Austria and Germany. Schoenherr acted as lead counsel to neoom on all aspects of this transaction. 

Schoenherr advised the Carrier Global Corporation (Carrier), a provider of intelligent climate and energy solutions, on its acquisition of Viessmann Climate Solutions, alongside Linklaters. The cash and stock transaction is valued at EUR 12bln and is the largest transaction in the German M&A market to date this year.

21 March 2024 | 5:00 – 8:30 pm EET

Molteni&C Flagship Store | 202 Calea Dorobanti, Bucharest

Schoenherr Romania advised AkzoNobel on the sale of its extruded polystyrene (XPS) insulation material production activities in Romania to HIRSCH Porozell. The production facility near Bucharest became part of AkzoNobel following the acquisition of Fabryo in October 2018. Through this divestment, AkzoNobel plans to focus on its key expertise and streamline its footprint towards a single production site in the local market.

Welcome to our March edition of Schoenherr's to the point: technology & digitalisation newsletter!

The Central Bank of Hungary (MNB) is encouraging the banking sector to increase the level of green loans. To this end, significantly reduced capital requirements have been put in place when applying for loans, and green company bonds were introduced in summer 2020 as part of the MNB bond funding for growth scheme. The Hungarian government is now ready to intervene to achieve climate neutrality.

13 - 15 June | Malta

Hungary, renowned for its architectural heritage, is on the verge of a major transformation in architecture and construction.

Thanks to numerous governmental measures, such as the introduction of the 5 % VAT rate, favourable conversion of foreign currency loans, baby waiting loans and VAT refunds, the number of Hungarian residential construction projects increased by the end of 2019. 

Hungary’s agricultural sector has a rich historical tradition but faces challenges due to insufficient financing. The European Union’s Common Agricultural Policy (CAP) provides funding for farm restructuring and market support, while Hungarian farmers can seek financing from banks and cooperatives. The Hungarian government has also established various programs to provide financing for agriculture, including subsidies or machinery and technology investments and funding for training.

For over 15 years, interested parties have been permitted to establish long-term leases on privately owned construction land for investment and building purposes. This opportunity for business expansion was formalised in 2008 with the Construction Land Act, following the adoption of the first Macedonian Construction Act, which prescribed long-term leasing as a legal basis for obtaining building permits.

Schoenherr advised Enery on the acquisition of a Romanian renewable energy multi-technology (wind, solar and hydropower) portfolio with 81 MWP of installed capacity from Jade Power Trust, and on the related financing. With this deal Enery, which has been developing solar greenfield assets in Romania for three years, enters the local green electricity production market as a major player.

22 September 2023 | Intercontinental Athénée Palace, Bucharest

Schoenherr advised Enery on signing a multi-year virtual power purchase agreement (VPPA) with Ursus Breweries, part of Asahi Europe & International, to provide green energy and guarantees of origin for the production at their brewing facilities in Romania.

As a part of the "Fit for 55" package for a climate neutral Europe by 2050, a recast of the EU Energy Performance of Buildings Directive (EPBD) is currently being adopted. Although still in the legislative process, the new EPBD clearly will impose stricter requirements for energy efficiency of buildings, with the plan to achieve zero-emission and fully decarbonised building stock by 2050. The three main aspects of the revised legislation are described below.

The smart city concept has been a topic of much debate and several legal instruments, such as the New Leipzig Charter or the Pact of Amsterdam. Nevertheless, robust legal support from the Romanian government is needed to transpose the European decisions and to narrow the gap between innovative ideas and their implementation.

Schoenherr advised Raiffeisen Bank International AG in connection with a EUR 31.06m project financing to Energy Financing Team SE Bileca d.o.o. Bileca as the borrower. The funds will be used to develop a 60 MW solar power plant in the Republic of Srpska, Bosnia and Herzegovina.

Schoenherr advised Vienna Stock Exchange listed Wienerberger AG, a leading international supplier of building materials and infrastructure solutions, on the EUR 81.25m placement of treasury shares with institutional investors.

In an era where convenience is king, consumers worldwide are embracing the ease of online services. A transformative trend known as open banking is making waves in the realm of finance.

The Danube is the longest river in Central Europe, and thus has significant economic potential. However, the full potential of the Danube as a major transport route has not yet been exploited. A reason for this is the fact that the Danube crosses ten countries, and there are, as a result, ten different applicable port legislations in the Danube region. 

Users are increasingly looking for innovative, time and cost-efficient dispute resolution. Commercial mediation can do the trick!

The EU Data Protection Regulation is in its second round. Having been rejected by the European Parliament earlier this year, Viviane Reding’s ambition of replacing the member states’ data protection laws by one single EU wide regulation has arrived at second base.

A new Building Act No. 283/2021 Coll. was approved in the Czech Republic and most of it is slated to take effect on 1 July 2023. But the right-wing coalition that won the parliamentary election in October 2021 is already planning to suspend its effect and amend it.

On 10 July 2020 the Bulgarian lev and the Croatian kuna were included in the Exchange Rate Mechanism II (ERM II). In the short term this means that the inclusion would support the confidence and credit ratings of the two countries while in the long term – this is an important milestone in Bulgaria and Croatia's efforts to join the euro area.

In the European Commission’s recently published Communication regarding the Capital Markets Union (“CMU”), it urges other institutions to accelerate completion of a true single market for capital across all EU Member States, and announces its work programme for 2017.

Rules for buying Romanian agricultural land will change as a new draft law is prepared. Will the new rules boost acquisition by foreigners or impede the process?

In ever-changing circumstances, adaptability is gold. And the traditional dispute resolution practice in CEE has been ridden with change in the last few years – modernised, advanced, improved. 

In May 2021, a judgment of the Hague District Court ordering Royal Dutch Shell to reduce its worldwide CO2 emissions by 45 % by 2030 reverberated across the globe.

Healthcare and life sciences have a special status as a type of legal practice. The debate about what this specialisation entails, and to what extent it even qualifies as legal work, is endless. However, as a crisis is also an opportunity, the coronavirus pandemic has defined the areas where law, healthcare and the life sciences overlap.

2023 began with further compliance challenges. Large German companies must adhere to the due diligence requirements of the new German Supply Chain Act, which aims to foster human rights and environmental standards. In parallel, the European legal initiative for a Corporate Sustainability Due Diligence Directive on due diligence in supply chains is progressing. A worldwide movement to hold companies responsible for activity across their supply chains is accelerating, ushering in a new era of ESG compliance for companies and their advisors.

The proposals for Public Procurement Directives are expected to increase the uptake of PPI by providing several instruments allowing the strategic use of public procurement to spur innovation.

The European Union has adopted far-reaching reforms to the EU Emissions Trading System (EU ETS) to meet its ambitious target of reducing net greenhouse gas emissions by at least 55 % by 2030. These reforms are part of the "Fit for 55" package and are intended to play a central role in combating climate change. Below we provide a brief overview of the measures adopted and their national implementation.

The German Supply Chain Act (Lieferkettensorgfaltspflichtengesetz; "LkSG"), which applies to companies seated in Germany or operating a German branch with 3,000 or more employees, entered into force on 1 January 2023.

The recent years' sprint towards digitalisation was one of the decisive factors in accelerating the transformation of telecommunications infrastructure. The global markets expect an increase in investments in telecom infrastructure and Romania is no exception.

On 29 December 2017, the Montenegrin parliament adopted a new Law on Tourism and Hospitality (the "Law"), which entered into force on 18 January 2018.

On 16 December 2016, the Council of the European Union announced agreement on its negotiating stance in relation to the proposed regulation amending the European Venture Capital Funds ("EuVECA") Regulation (Regulation (EU) No 345/2013) and the European Social Entrepreneurship Funds ("EuSEF") Regulation (Regulation (EU) No 346/2013), which is now at the European Parliament's ECON committee, scheduled to be voted on, on 22 March 2017. 

The unprecedented economic crisis caused by the COVID-19 pandemic is severely impacting the electricity sector, with demand falling as much as 20 % in certain cases, according to data published by the International Energy Agency (IEA).

In September 2015 the European Commission ("Commission") adopted an action plan on building a capital markets union (the "CMU") (the "CMU Action Plan"). 

When Schoenherr entered the Romanian market 25 years ago, the local real estate sector was barely getting off the ground. 

On 14 August 2023 the Hungarian Government issued Gov. Decree 382/2023 ("Decree") establishing the legal framework for the implementation and functioning of the new Contracts for Difference ("CfD") support scheme for electricity storage operators ("Storage CfD Scheme").

Supply chains have been in focus throughout 2020, and not only thanks to COVID-19. Earlier this year, the European Commissioner for Justice, Didier Reynders, announced that in 2021 the Commission would propose legislation on mandatory corporate due diligence covering human rights and environmental risks across a business's supply chain.

Introduction

CSR, CSRD and now CSDDD: so many abbreviations have appeared over the last years in the context of sustainability. Sometimes referred to as the "European Supply Chain Act", CSDDD stands for the "Corporate Sustainability Due Diligence Directive". It is commonly abbreviated as the "CSDDD", "CSDD directive" or "CS3D".

The EU Shareholder Rights Directive II (2017/828) (SRD II), amending Directive 2007/36/EC as regards the encouragement of long-term shareholder engagement, must be transposed into national law by 10 June 2019.

As a result of the strong decrease in electricity market pricing, green electricity plant projects cannot find a place in special promotion quotas. 

In the past twelve months, energy prices seem to have taken a life of their own. Their continued and, at times, shocking growth has raised concerns across the region and prompted differing responses and policy changes in each country.