6.250
%
Negative
29
mm boe
44
%
Germany continues to rely increasingly on imported gas, yet fails to support any growth in domestic production. Further, EU membership remains an unknown factor, especially when considering the "top down" approach to legislation. Consequently, we believe that the country remains as high a risk for O&G investment as France.
May 21, 2021
Europe - Central
mm bbl
bcf
Central Europe, bordering the Baltic Sea and the North Sea, between the Netherlands and Poland, south of Denmark.
Concession
In principle, there is no special taxation regime applicable to the oil and gas industry in Germany. Oil and gas companies are subject to the general accounting and taxation principles, i.e., they are subject to corporate income tax, solidarity surcharge and trade tax. In addition to that, oil and gas companies are subject to royalties for the exploration of oil and gas in Germany. Germany does not impose signature or production bonuses, and there are no state participation arrangements.
The German government continues to strengthen provisions for national security screening inward investment in reaction to an increasing number of high-risk acquisitions of German companies by foreign investors in recent years, particularly from China. In 2018, the government lowered the threshold for the screening of investments, allowing authorities to screen acquisitions by foreign entities of at least 10 percent of voting rights of German companies that operate or provide services related to critical infrastructure. German legal, regulatory, and accounting systems can be complex and burdensome but are generally transparent and consistent with developed-market norms, operating in a well regulated, albeit high cost, environment. Foreign investors can rely on the German legal system to enforce laws and contracts; at the same time, this system requires investors to closely track their legal obligations.
Source: ESRI, Heritage Index, HMG Foreign & Commonwealth Office, US Department of State, International Trade Administration, International Law Review, Ernst & Young, Wood Makenzie & OGA data.
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