Effective conversion. (1) A change in the terms of the debt relationship between creditor and debtor shall be considered as an effective conversion, if it was made before 9 June 1933, or if it occurred on or after 9 June 1933, as a result of free negotiation or on account of the insolvency or threatened insolvency of the debtor. (2) It shall be presumed that there is no effective conversion resulting from free negotiation if at the time of conversion the creditor was represented by the German Custodian of Enemy Property or by a similar person appointed by the German authorities without his consent. (3) In the case of bonded claims, a conversion shall likewise not be considered an effective conversion if the creditor has merely accepted a unilateral offer made by the debtor. (4) The burden shall be on the debtor to prove that the conversion was an effective conversion. (5) In the case of Church loans, any conversion shall be considered effective.
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Sources: Agreement on German External Debts, Agreement on German External Debts