VW law

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Basic data
Title: Law on the transfer of the shares in Volkswagenwerk limited liability company into private hands
Short title: VW law (not official)
Abbreviation: VWGmbHÜG (not official)
Type: Federal law
Scope: Federal Republic of Germany
Legal matter: Commercial administrative law , corporate law
References : 641-1-1
Issued on: July 21, 1960 ( BGBl. I p. 585 )
Entry into force on: July 28, 1960
Last change by: Art. 14c G of 30 July 2009
( Federal Law Gazette I p. 2479, 2493 )
Effective date of the
last change: 		September 1, 2009
(Art. 16 G of July 30, 2009)
GESTA : C181
Please note the note on the applicable legal version.

The law on the transfer of shares in the Volkswagenwerk limited liability company (VWGmbHÜG) - colloquially known as the VW law - came into force on July 28, 1960, when Volkswagenwerk GmbH was privatized and converted into a stock corporation.

It states that no shareholder can exercise more than 20 percent of the voting rights , even if he owns more shares. The aim of the public sector at the time was to maintain influence over the car manufacturer, as the law grants the state of Lower Saxony with its share of 20.2 percent a blocking minority , i.e. a veto right in all important decisions. A large part of the capital was donated to the Volkswagen Foundation.

content

The law originally consisted of 14 paragraphs, the majority of which have now been repealed or have become meaningless. Section 1 stipulated that Volkswagen GmbH was to be converted into a stock corporation immediately when the law came into force. Section 2 contained regulations on voting rights and restrictions on voting rights. This regulation is no longer in force today. Section 3 regulates representation when exercising voting rights. Sections 5–12 concerned details of the purchase and sale of the new shares created by the conversion into a stock corporation. These regulations are also no longer in force today.

Four-fifths majority for general meeting resolutions

Section 4 (3) of the VW Act states that

"Resolutions of the general meeting for which a majority is required according to the Stock Corporation Act, which comprises at least three quarters of the share capital represented when the resolution is passed, [...] a majority of more than four fifths of the share capital of the company represented when the resolution is passed."

As a result of this special regulation, important resolutions at Volkswagen AG, such as changes to the articles of association and capital increases , can only be made with a majority of more than 80 percent. For other stock corporations, a 75 percent majority is sufficient. Since the state of Lower Saxony holds more than 20 percent of the VW shares, such resolutions are not possible without the approval of the state. The state of Lower Saxony therefore has a blocking minority . If Section 4 (3) of the Act were to be repealed, this blocking minority would no longer apply.

Two-thirds majority in production facility decisions

According to Section 4 (2), the construction and relocation of production facilities require the approval of the Supervisory Board. The resolution requires a majority of two thirds of the members of the supervisory board. With this special regulation, the VW supervisory board has a say when the board of directors decides on the fate of the VW production facilities. The supervisory board must also agree with a two-thirds majority, which ultimately means that the employee representatives on the supervisory board, who make up half of the members, can prevent the construction and relocation of production facilities.

history

The reason for this law lies in the VW company's Nazi past. Shortly before the Second World War, the VW plant was built by the " German Labor Front " (DAF), the NSDAP's branch with the largest number of members and financially strong . The construction of the factory, which was built east of Fallersleben in 1938/39, was partially financed by DAF with the assets of the unions, which were broken up in 1933. This and the use of forced labor formed a financial basis for the group.

The privatization was the result of a dispute between the then CDU-led federal government and the then SPD-ruled state of Lower Saxony. The British High Commission had handed the company over to the State of Lower Saxony in the name and on instructions of the Federal Republic of Germany. So it was unclear whether Lower Saxony only the trustees of the society had become or property owner. The dispute was settled through a settlement that was concluded as a state treaty . On the basis of the state treaty, the VW law was passed. The law transformed the Volkswagenwerk limited liability company into a stock corporation .

An agreement was only reached with the federal, state, trade unions and buyers of the purchase option certificates with the VW Act.

The privatization was reviewed by the Federal Constitutional Court (BVerfGE 12, 354; Az .: 1 BvR 561/60, 579/60, 114/61) within the framework of constitutional complaints and deemed to be proper. The constitutional complaints were unfounded.

Another constitutional complaint (Ref .: 1 BvR 764/70) against the revocation of the privileges granted to the Federal Government and the State of Lower Saxony according to Section 2 (4) of the VW Act (old version) by the Second Act amending the Act on the Transfer of Share Rights in the Volkswagenwerk Gesellschaft limited liability of July 31, 1970 ( Federal Law Gazette I p. 1149 ) was declared as "not inadmissible", but not accepted for decision according to § 93a Abs. 4 BVerfGG.

Conflict with the EU Commission

1. Legal action at the ECJ

The European Commission has asked Germany end of March 2004 an ultimatum to amend the Volkswagen law until the end of May of 2004. The responsible commissioner Frits Bolkestein saw in the VW law, which is supposed to prevent a “hostile takeover” of the Wolfsburg-based car company, a violation of the free movement of capital (Art. 56 (1) EGV ) in the European Union. It is possible that the freedom of establishment under Article 43 (2) of the EC Treaty has been violated.

On October 13, 2004, the EU Commission decided to refer the matter to the European Court of Justice (ECJ) in accordance with Art. 226 (2) EGV . The action before the ECJ was received on March 18, 2005 (Ref .: C-112/05).

In a judgment of June 2, 2005, the ECJ declared an Italian regulation incompatible with Art. 56 (1) EC Treaty, in which the voting rights of shareholders with shares of more than two percent in electricity and gas companies are automatically suspended (C-174/04 ).

It was therefore generally expected from the judgment in the VW case that the special regulations of the VW law (e.g. the so-called “ golden share ”) will not last in the EU, and that the way will be cleared for an increase the corporate shares of the Porsche group and for the industrial leadership in the VW-Audi group on the part of Porsche AG . A preliminary decision in this direction was made in the Opinion of Advocate General Colomer of February 13, 2007: He assessed the disputed provisions of the VW Act (restriction of voting rights, the right to post and a reduction in the blocking minority ) as an inadmissible interference with the free movement of capital and proposed to the court that the Federal Republic of Germany condemned in accordance with the requests of the EU Commission. The ECJ shared this view with regard to the free movement of capital (Art. 56 EC) and declared the law unlawful to the EC in its judgment of 23 October 2007. In particular, employee protection does not justify an encroachment on Article 56 EC. The Federal Republic is obliged to change or abolish the law.

On May 27, 2008, the federal government presented a government draft for a new VW law. However, this only makes limited changes. While the right to delegate to the supervisory board and the restriction of voting rights are to be abolished, the federal government wants to adhere to the 80 percent majority requirement for important company decisions, and thus remains within the scope of Section 179 (2) of the German Stock Corporation Act , according to which a stock corporation has a majority other than three quarters for amendments to the statutes and Ä. Can specify. In addition, a regulation according to which every decision on the production location requires a two-thirds majority in the supervisory board is to be retained. The new draft law has already been clearly criticized and classified as also incompatible with the free movement of capital. The European Commission had already initiated another infringement procedure against Germany. On September 9th, 2008 it became known that the VW law would be tried again before the highest EU court.

Despite massive criticism from the EU and major shareholder Porsche , the German Bundestag passed the new draft of the law on November 13, 2008, maintaining the blocking minority of 20 percent. The Federal Council had also approved the law in the meantime. Immediately after the Bundestag's decision, the EU Commission announced that it would take quick steps against the Federal Republic of Germany, which could lead to another lawsuit before the European Court of Justice. The new version was approved on December 8, 2008.

2. Legal action before the ECJ

On November 27, 2008, the EU Commission set the federal government a final deadline to amend the VW Act. After the two-month deadline for changing the law in the interests of the Commission, another action was brought before the European Court of Justice (ECJ). The EU Commission clashed with the right of veto of the State of Lower Saxony for important measures to change the statutes and structural decisions (20% blocking minority of the State of Lower Saxony). Such a right of veto is only common if the voting rights share is 25%. On February 21, 2012, the Commission initiated new infringement proceedings before the ECJ against Germany (case C-95/12). The European Court of Justice ( ECJ ) heard about this on March 12, 2013 in Luxembourg. In May 2013, the Advocate General spoke out in favor of dismissing the EU Commission's action. In the opinion of the Advocate General, the Federal Government has already fully implemented an earlier judgment. On October 22, 2013, the European Court of Justice dismissed the lawsuit on the grounds that, following the changes that had already been implemented, the VW Act did not violate applicable EU law. The ECJ did not judge the content of the question of whether the blocking minority of Lower Saxony in itself violated EU law, but only on whether Germany had complied with the required changes. In the event of victory, the commission had to pay a fine i. H. of EUR 31,000 per day since the date of the judgment in 2007. That would have meant fines of around EUR 63–68 million. The Commission has announced that, following the ECJ ruling, it will now let the matter rest.

Individual evidence

  1. ↑ The historical responsibility for VW.  ( Page no longer available , search in web archives )  Info: The link was automatically marked as defective. Please check the link according to the instructions and then remove this notice. IG Metall, read on March 28, 2010.@1@ 2Template: Dead Link / www.igmetall.de  
  2. ↑ Official Journal EU No. C 118 of April 21, 2012, p. 19.
  3. ↑ Judgment of the European Court of Justice (Grand Chamber) of October 22, 2013, case C ‑ 95/12
  4. ↑ frz: Protection against hostile takeovers: European Court of Justice confirms VW law. In: Focus Online . October 22, 2013, accessed October 14, 2018 .
  5. ↑ Focus Finances Weekly Preview (dpa data)

literature

  • A. Endell: Volkswagen on offer - VW law offers no protection against hostile takeovers , in: Neue Zeitschrift für Firmenrecht 2000, pp. 1160–1161
  • W. Kilian: VW Law and Science Promotion , in: Neue Juristische Wochenschrift 2002, pp. 3599–3601
  • H. Krause: From “golden shares”, the VW law and the takeover directive, in: Neue Juristische Wochenschrift 2002, pp. 2747–2752
  • R. Ruge: Goldene Aktien und EG-Recht , in: EuZW 2002, pp. 421–424
  • St. Grundmann, F. Möslein: The golden share , in: Journal for corporate and corporate law 2003, pp. 317–366
  • C. Armbrüster: "Golden Shares" and the fundamental freedoms of the EC Treaty , in: JuS 2003, p. 224 ff.
  • F. Sander: Volkswagen before the ECJ - The area of ​​protection of the free movement of capital at the crossroads , European Journal for Business Law (EuZW) 2005, pp. 106-109.
  • M. Pießkalla: Golden shares from an EC legal point of view , dissertation, Verlag Dr. Kovac, Hamburg 2006, ISBN 3-8300-2307-3 .
  • N. Reich: Brief discussion of the Opinion of Advocate General Dámaso Ruiz-Colomer v. February 13, 2007 in case C-112/05 - Commission / Federal Republic of Germany regarding the VW Act (VWG) , in: EuZW 2007, p. 132 ff.
  • W. Kilian, Compatibility of the VW Act with European Law , in: Neue Juristische Wochenschrift 2007, p. 3469 ff.
  • F. Sander: Maximum voting rights and free movement of capital according to the VW law decision - does the ECJ psychologize the scope of protection of Article 56 EC? , European Journal for Business Law (EuZW) 2008, p. 33.
  • F. Sander: Case C-112/05, European Commission v. Federal Republic of Germany: The Volkswagen Case and Art. 56 EC - A Proper Result, Yet Also a Missed Opportunity? , 14 Columbia Journal of European Law (2008), 359-370.
  • A. Kömpf: State Influence on Volkswagen AG: Limits of State Influence on Business Enterprises in Private Law , Dissertation, Verlag Peter Lang, Frankfurt 2010, ISBN 978-3-631-59321-9 .
  • Ulrich Seibert : The Porsche / VW takeover battle and the black peter game about the VW law , Die Aktiengesellschaft, 2013, p. 904 ff.

Web links