What does Section 8c KStG regulate, and what is its impact on target NOLs in an M&A deal?

Section 8c KStG is a German rule that can restrict or eliminate tax loss carryforwards after harmful ownership changes. In M&A, a change of control can reduce the buyer's ability to use target NOLs. The value of DTAs must therefore be diligence-tested under German tax rules, including exemptions and restructuring clauses where applicable.