Emergency management is set up when
a) no other manager exists AND
b) the managing director can not assume the management (e.g. by death or serious illness, coma).
In such a case, the shareholders as well as the creditors can submit an application for the appointment of an emergency manager to the local district court and propose a person. It is recommended that a clear regulation for such an emergency be included in the statutes / articles of incorporation at the time of incorporation and that any existing statutes and articles of incorporation be amended as appropriate.
Since it is usually about a short period of time - until the shareholders have found a suitable new managing director - often the accountant or the lawyer of the company could act as interim managing directors, since they know the company and its business relations. However, it should be noted that the elected emergency manager can reject the order of the local court, so you should make sure to obtain in advance their consent, so that the company's ability to act is secured.
In the frequently occurring constellation of a sole shareholder and managing director, heirs / family members should immediately submit the application to protect their interests. Otherwise, a malicious creditor may be the first to file an emergency claim and propose a manager agreeable to him.
The emergency manager is registered in the German Trade Register like any normal managing director. The managing director registered in the Trade Register is authorized to conduct all business transactions on behalf of the company.
The emergency manager is recalled by the court that ordered him. The shareholders can not recall him, but they can make a request to the court.