Charlottenburg Local Court ordered insolvency proceedings for safeguarding NIKI Luftfahrt, a company incorporated under Austrian law with its registered office in Vienna. At the time, its indirect shareholder, Air Berlin (with its registered office in Berlin), had already commenced proceedings in Germany. While Charlottenburg Local Court was satisfied that NIKI's centre of main interest was in Berlin, the Berlin Court of Appeal decided that it had been wrong to assume jurisdiction.
German regulations obliging managing directors to monitor the liquidity of a company during crisis situations are typically strict and give rise to the risk of personal liability in cases of non-compliance. Legislation requires company management to file for insolvency proceedings without undue delay in the case of illiquidity or over-indebtedness. Continued trading where the company is considered to be materially insolvent can have serious consequences.