Skip to main content

The controversial Germany “Volkswagen Law” of 1960

On this day in 1960, the German government passes the “Law Concerning the Transfer of the Share Rights in Volkswagenwerk Limited Liability Company into Private Hands,” known informally as the “Volkswagen Law.”
Founded in 1937 and originally under the control of Adolf Hitler’s National Socialist (Nazi) Party, Volkswagen would eventually grow into Europe’s largest car manufacturer and a symbol of Germany’s economic recovery after the devastation of World War II. The Volkswagen Law, passed in July 1960, changed the company to a joint stock corporation, with 20 percent held each by Germany and Lower Saxony, the region in which Volkswagen is still headquartered. By limiting the share of any other stockholder to 20 percent, regardless of how many shares owned, the law effectively protected the company from any attempt at a hostile takeover.
By 2007, the controversial legislation had come under full-blown attack from the European Commission as part of a campaign against protectionist measures in several European capitals. The commission objected not only to the 20 percent voting rights cap but to the law’s stipulation that measures taken at the annual stockholders’ meeting must be passed by more than four-fifths of VW shareholders–a requirement that gave Lower Saxony the ability to block any such measures as it saw fit.
In March of that year, fellow German automaker Porsche announced that it had raised its stake in Volkswagen to 30.9 percent, triggering a takeover bid under a German law requiring a company to bid for the entirety of any other company after acquiring more than 30 percent of its stock. Porsche announced it did not intend to take over VW, but was buying the stock as a way of protecting it from being dismantled by hedge funds. Porsche’s history was already entwined with Volkswagen, as the Austrian-born engineer Ferdinand Porsche designed the original “people’s car” for Volkswagen in 1938.
On October 23, 2007, the European Court of Justice formally struck down the Volkswagen Law, ruling that its protectionism illegally restricted the free movement of capital in European markets. The decision cleared the way for Porsche to move forward with its takeover, which it did, maintaining that it will still preserve the Volkswagen corporate structure. By early 2009, Porsche owned more than 50 percent of Volkswagen shares.

Comments

Popular posts from this blog

Duncan Logan just tweeted that he's on board Electroneum

I have been a buyer and holder of bitcoin and Etherreum for a long time but this will be the first ICO I buy into--Duncan Logan.

What is Electroneum?

Electroneum (ETN) is a cryptocurrency that can be mined with a smartphone, requiring almost no technical knowledge or prior experience. This sets it apart from other cryptocurrencies (like Bitcoin) which require expensive hardware and technical know-how to mine.
Electroneum’s unique mobile mining experience allows anyone with a smartphone to earn ETN coins by letting the miner app run in the background.
It was designed specifically with mobile users in mind, thereby appealing to a potential market of 2.2 billion smartphone users around the world. Unlike other cryptocurrencies, Electroneum has a user-friendly, beginner-oriented interface that allows users to seamlessly transfer ETN coins between one another, check their balances, and mine coins.
Being a cryptocurrency, Electroneum is created, held, and spent electronically, and has no phy…

Police Bust Alleged $13 Million Crypto Pyramid Scheme

Police in China's northwestern city of Xi'An have arrested the founders of a claimed nationwide cryptocurrency pyramid scheme that allegedly amassed 86 million yuan ($13 million) from over 13,000 people.
According to a report from local media source Huashang News, Wednesday, the scheme launched in March 28 this year after months in preparation by a primary suspect who has has the surname Zheng, as well as three other accomplices.
The report cited an investigation from the police who said the scheme used a cryptocurrency called Da Tang Coin (DTC) that is linked to DTC Holding - a firm under the suspect's control and registered in Hong Kong - to allegedly hoax potential members of the pyramid scheme.
In various promotional events in multiple cities in the country, the scheme claimed that new members can make 80,000 yuan (roughly $13,000) per day with an initial investment of $480,000 to purchase the DBTC at $0.50 per token, according to the report.
These promises of high r…

Is Bitcoin Legal?

Bitcoin is of interest to law enforcement agencies, tax authorities, and legal regulators, all of which are trying to understand how the cryptocurrency fits into existing frameworks. The legality of your bitcoin activities will depend on who you are, where you live, and what you are doing with it. Bitcoin has proven to be a contentious issue for regulators and law enforcers, both of which have targeted the digital currency in an attempt to control its use. We are still early on in the game, and many legal authorities are still struggling to understand the cryptocurrency, let alone make laws around it. Amid all this uncertainty, one question stands out: is bitcoin legal? The answer is, yes, depending on what you’re doing with it. Read on for our guide to the complex legal landscape surrounding bitcoin. Most of the discussion concerns the US, where many of the legal dramas are currently playing out. Alternatively, you can access our comprehensive Regulation Report for worldwide expert …