Deutsche Pfandverwertung — Our expertise and services in lien law.
Why Deutsche Pfandverwertung?
Our role and the legal requirements for conducting a public auction.
We are publicly appointed and authorized to conduct public auctions (“Public Auctions”) and, in that capacity, operate as part of the justice system in a functional sense. We are sworn to independence, freedom from instruction, diligent performance, and confidentiality vis-à-vis third parties. This is essential because the owner of the auctioned property has no control over the sale price or the reserve (minimum bid) and must therefore be able to rely on the auctioneer to protect his proprietary interests to a particularly qualified standard. Public Auctions are conducted under the applicable provisions of the German Civil Code (BGB), Commercial Code (HGB), Limited Liability Companies Act (GmbHG), Stock Corporation Act (AktG), Anti-Money Laundering Act (GwG), Trade Regulation Act (GewO), and the Auctioneers’ Ordinance (VerstV). The German Code of Civil Procedure (ZPO), the Act on Compulsory Auction and Receivership (ZVG), and the Court Bailiffs’ Service Instructions (GVGA) do not apply to publicly appointed auctioneers.
With the amendment of Section 383 BGB as of 01.01.2025, the legislator is clearly focusing on the publicly appointed and sworn auctioneer. The group of persons authorized to conduct public auctions is defined and qualitatively focused. This means that the auctioneer is not only de facto, but also fully anchored in the law as a regular actor. The legislator has thus made a clear evaluation decision. In the case of non-performing contractual relationships, the legislator deliberately intends to bring about an efficient, market-oriented and commercially-oriented solution to the settlement between creditor and debtor by appointing a publicly appointed and sworn auctioneer.
The public auction, as the statutory rule for the realization of pledged assets under Sections 1235 et seq. of the German Civil Code (BGB), delivers legal clarity and finality. Under the surrogacy principle, value is determined by sovereign act via the public auction.
In special situations, stakeholders require a robust, time-efficient, and legally compliant realization path that delivers a final outcome without post-closing renegotiation—particularly where prior negotiations, extensions, or an attempted private sale under Section 1245 BGB have failed.
Legal requirements governing the proper conduct of a public auction.
(1) A valid and enforceable pledge right
A public auction requires a valid and enforceable pledge right that confers the legal authority to realize the collateral.
(2) Confirmation of legal requirements
Prior to accepting the mandate, the auctioneer must obtain an express confirmation that the civil-law and trade-regulatory requirements for the realization are satisfied.
(3) Transparency
Transparency must be ensured through a virtual data room (VDR) (for rights and for sensitive or high-value tangible assets) containing all realization-relevant documents then known to, and made available to, the auctioneer.
Where the auction relates to rights, this includes disclosure of all value-relevant circumstances known to the auctioneer, in particular liabilities, legal and corporate-law restrictions, and any other value-affecting factors, in each case on the basis of full information parity among all bidders.
(4) Marktschaffung
Der Versteigerer muss keinen Markt garantieren; er darf aber kein Verfahren durchführen, bei dem ex ante feststeht, dass ein Markt bewusst verhindert wird. Die Versteigerung erfordert eine angemessene, zweckmäßige Bekanntmachung (§ 1237 BGB) an den relevanten Erwerberkreis. Maßgeblich ist die tatsächliche Herstellung von Wettbewerb. Ein “Mindeststandard” für ewaige Mindestmedien oder Reichweiten ist gesetzlich nicht definiert. Die Kommentarliteratur erwähnt zu § 1237 BGB die ordnungsgemäße Bekanntmachung, Zweckmäßigkeit und Wettbewerbserzeugung.
(5) Independence from direction or control
The auctioneer must act independently and not be subject to instructions. The process must not be directed or pre-determined by any individual stakeholder interest—whether through the scope and manner of public notice, the setting of the opening bid, the auction format and procedure, the time, place, or modality of the auction, or the award decision.
(6) Appropriate opening bid (avoidance of undervalue allegations)
The opening bid serves solely to facilitate an orderly price discovery process and must not be set as an artificial minimum value. Any form of price steering that restricts competition creates a risk of challenges or liability claimsbased on an alleged realization at an undervalue.
Our core expertise
Our publicly appointed and sworn auctioneers specialize—strategically and operationally—in the realization of collateral based on contractual or statutory pledge rights in distressed and enforcement situations, with particular focus on the auction of equity interests and IP rights such as trademarks, patents, licenses, domains, as well as high-value tangible assets.
Our strengths and capabilities
- Legally compliant execution: Each step is documented, traceable, and designed to meet the requirements of courts and secured creditors. This minimizes liability risks and increases process acceptance.
- Long-standing, proven process structure and experience in the exploitation of rights of all kinds as well as specialist auction design
- Rapid process implementation from order placement (standard lead time: 3–6 weeks)
- Cross-border settlement competence (cross-border)
- Proven contract in all process phases and transfer agreement for the commercial register
- Assessment of prospective bidders: financial investors, strategic investors, opportunistic investors, and bidders acting pursuant to Section 1239 BGB.
- International reach: Through digital marketing and international bidding circles, we increase demand — especially for IP rights, company shares and location-based assets — and plausibly create the market
- A non-discriminatory bidder universe, including potential buyers identified by the creditor, with registered and vetted participants subject to KYC/AML and sanctions checks and a creditworthiness review.
- Formal notice to the debtor to provide current documentation for populating the VDR in accordance with contractual cooperation obligations and covenants.
- Online live auction with live stream, legally compliant according to § 383 BGB n.F; transmission on German server, low latency time
- Transparenz bis zum Abschluss: klare Zeit- und Erlösplanung bei kurzer Laufzeit, öffentliche Bekanntmachung gemäß § 1237 BGB, regelmäßige Reports, strukturierter, belastbarer Datenraum auf deutschem Server (VDR/NDA) und plausible Dokumentation.
Key Messages
The public auction is not a negotiation process, but a legally compliant, sovereignly legitimized procedure; the knockdown ends the procedure in a legally binding manner and excludes any renegotiation. Signing and closing coincide in one act (§ 156 BGB) and bring about a realization with clear temporal and economic finality:
Clearly defined, legally provided recovery mechanism; clear separation between the conduct of proceedings and legal advice
Plannable exit and workout structures; reliable basis for credit, recovery and committee decisions
Costs: Full burden of costs on the debtor as the initiator of the proceedings.
Irrevocable valuation by virtue of a sovereign act
Final award instead of open negotiation processes
No renegotiation, no closing risk; no re-trading risk
No ongoing contractual or execution risks
Objective, market-based pricing; market price determination through competition instead of bilateral negotiation
Transparent risk structure (“as is”)
Reduced potential for liability and disputes
No right of realization of the insolvency administrator for pledged rights (no application of Section 166 (1) InsO for rights; BGH 27.02.2022 IX ZR 145/21). Realization is the responsibility of the pledgee — thereby excluding liability for possible claims by individual creditors or the creditors’ meeting
- Documented decision-making and award logic; high connectivity to internal decision-making and auditing processes, complete documentation for compliance and auditing.
Conclusion:
The publicly appointed and sworn auctioneer acts under a statutory duty of care, with neutrality and professional expertise. The governing standard is a diligent, commercially reasonable, transparent, and well-documented conduct of the auction process, safeguarding the interests of all stakeholders.
He is obligated to ensure a market-conforming, transparent, and equal-opportunity procedure. He must not facilitate an evidently unconscionable undervaluation (cf. § 138 German Civil Code – BGB), engage in collusive conduct, or systematically exclude or shield bidders from participation.
The opening bid, determined on the basis of a plausibility assessment, constitutes a procedural instrument rather than a valuation commitment. The hammer price (award) establishes the fair market value as determined through competitive bidding.
Efficient processes and innovative solutions
Optimized and proven processes developed by us guarantee efficient and legally compliant recycling — quickly and at short notice.
We integrate AI into our processes.
We use legally compliant, modern methods for online live auctions,
Virtual data room (NDA), server in Germany
Legal certainty
The exclusion of any warranty at the auction protects creditors from subsequent claims.
Acquisition in good faith when selling pledged property provides security against third-party claims.
The value is irrevocably determined by a sovereign act.
Legally compliant processing in all procedural steps.
Market expertise
Our expertise includes the analysis of national and international markets for rights, company shares, patents, trademarks and objects of all kinds.
As export merchants, we correspond multilingually via international sales channels.
As proven experts in the field, we offer a good price/performance ratio.
Network and customer base
We combine traditional print communication with innovative strategies that combine video, audio and text formats to reach a broad national and international target group.
Our extensive network, established customer base for goods and rights of all kinds and intensive case-related research enable us to create markets for (new) prospective buyers at short notice.
How we work with creditors
Our function
We are not an enforcement body of the state. As publicly appointed, sworn auctioneers, we are part of the administration of justice in collateral enforcement. We help to solve problems. In doing so, we follow the commercial approach, because the default on contracts almost always has commercial causes. It is therefore the most effective course of action to solve the problem fairly. This results in the best possible realization of claims for creditors and a reduction in liabilities for debtors. We act independently and impartially. We are not a service provider for the creditor, but an authority sworn to independence in the realization procedure. We are called in to protect property rights, including those of the debtor, due to the state prohibiting self-help.
Special expertise
Legislation stipulates that a publicly appointed and sworn auctioneer must have special expertise. This is understood to mean above-average specialist knowledge and extensive practical experience. An auctioneer to be appointed has sound legal and specialist knowledge, many years of professional experience and particular trustworthiness and stands out from his professional colleagues.
We combine comprehensive expertise with the highest professional qualifications to enforce liens in a targeted and efficient manner — with the aim of achieving economically optimal solutions for both creditors and debtors in the short term. Our many years of experience enable us to precisely analyze national and international markets and develop optimal sales opportunities for rights such as company shares or patents and objects of all kinds in a targeted manner. Depending on the task at hand, we put together interdisciplinary teams from our network to develop tailor-made solutions. Our aim is to help creditors to enforce their claims promptly and at the same time help to reduce debtors’ liabilities.
What we stand for
Our profession in Germany has its origins in the days of the Hanseatic League, an era characterized by the fundamental values of the Hanseatic merchant. These values — integrity, reliability and the pursuit of commercial solutions — form the foundation of our corporate culture. For the free Hanseatic merchant, it is a matter of course to solve problems by commercial means first. We are committed to this tradition. It characterizes not only the way we work as publicly appointed and sworn auctioneers, but also the partnership-based cooperation with our clients.
Empathy
The realization of claims due to liens is often an unusual and stressful situation for creditors and debtors. For us, however, the realization of liens is part of our daily practice. We do not see ourselves as an enforcement body, but as a partner who respectfully considers the interests of both sides.
We address the underlying problems with empathy and develop individual, tailor-made solutions. Tolerance and respect form the basis of our actions. By putting ourselves in the shoes of everyone involved, we create a framework in which demands can be balanced responsibly and outstanding liabilities can be reduced — always in a spirit of mutual appreciation.
In some cases, we encounter difficult debtors who behave obstructively and irrationally, often acting against their own interests. Our many years of experience enable us to de-escalate such situations professionally and bring communication from an emotionally aggressive to a factual level.
In most cases, the legitimacy of the claims is beyond question. Nevertheless, attempts are often made to prevent the public auction by looking for formal errors. Our top priority is therefore complete and precise compliance with all legal requirements.
Entrepreneurial spirit
We understand the challenges of entrepreneurial activity and know what makes companies successful. For us, being an entrepreneur also means taking responsibility — for decisions, solutions and their consequences.
With this understanding, we develop innovative and sustainable strategies to enable creditors to realize their claims quickly and efficiently. Our approach combines foresight with pragmatism and aims to shape economic interests in a responsible and future-oriented manner.
Excellence
Excellence and innovation — for success at the highest level: We stand for outstanding results and set standards for measurable and sustainable success. Our commitment to excellence shapes everything we do, from strategic planning to working with creditors and debtors.
We always aim to achieve the best — through precision, commitment and a consistent focus on the highest standards. For us, excellence is not just a claim, but our promise.
If you are affected by a claim.
The “one-size-fits-all” approach is often not expedient when realizing receivables through contractual or statutory liens. Each case requires an individual approach and tailor-made solutions.
During this call, we will outline the key legal prerequisites of a public auction, explain our statutory role and function, and invite you to briefly present the relevant facts of your case. Together we will analyze your situation and clarify whether a collaboration makes sense. Following the discussion, we will provide you with a concise handout summarizing the principal parameters of the process, together with a description of our services.
Would you like us to propose specific time slots for the initial call?
We look forward to hearing from you > contact us.
