The Volkswagen Act is a set of German (originally West German) federal laws enacted in 1960, regulating the privatization of Volkswagenwerk GmbH into the Volkswagen Group. [1] In order to maintain government control in the privately owned company, it stipulated that the votes in major shareholder meeting resolutions require 4/5th (80%) agreement. [2] This part of the law was deemed to violate the "free movement of capital" principle of European Union corporate law. [3] After a series of challenges from 2007 to 2013, the German parliament finally amended the part in 2013 to EU Court of Justice satisfaction. [4]
The full title of the law is "Gesetz über die Überführung der Anteilsrechte an der Volkswagenwerk Gesellschaft mit beschränkter Haftung in private Hand", usually abbreviated to "VW-Gesetz". It was enacted on 28 July 1960, when Volkswagenwerk GmbH was privatized. The government of the German state Lower Saxony held a voting share of 20.2 percent, which gave it the ability to veto major decisions and prevent takeovers by other shareholders, regardless of the extent of the ownership. [5] It also allowed the government of Lower Saxony to appoint two members to the Volkswagen Group's board of directors.
In October 2007, the European Court of Justice ruled that the VW law was illegal because of its protectionist nature. At that time, the Porsche SE holding company held 30.9% of VW Group shares and there had been speculation that Porsche SE would be interested in buying all shares if the law did not stand in its way. The Court of Justice also prevented the government appointing Volkswagen board members. [6] [7]
In 2008, the German government then rewrote the Volkswagen law, attempting to sidestep the ECJ judgment; removing restrictions on share ownership but still requiring an 80% majority for important decisions, so Lower Saxony would still be able to block major business decisions and takeovers. [8] European Commission regulators took the German government to court again [9] [10] and requested a fine of €31,114 per day backdated to when the law was declared illegal in 2007, plus larger ongoing fines from the date of a second court judgment. In March 2012, the German government insisted that it would defend the Volkswagen Law in court. [11]
In October 2013, the EU Court of Justice ruled that the redraft of the Volkswagen law “complied in full” with Union law, bringing "the matter to a close,” as Chantal Hughes, spokeswoman for EU Internal Markets Commissioner Michel Barnier said. [5] [12]
During the above developments, the Porsche SE holding company, which traditionally had close relationships with Volkswagen, increased its holding of Volkswagen Group's shares as follows:
Oct 2005 | Nov 2006 | Mar 2007 | Sep 2008 | Jan 2009 |
---|---|---|---|---|
18.53% [13] | 27.4% [14] | 30.9% [14] | 35.79% | 50.76% [15] |
Porsche had many difficulties financing the large investment, and agreed in August 2009 to sell its automobile manufacturing business to Volkswagen Group, [16] while retaining the majority ownership in Volkswagen Group. Porsche SE officially became the controlling owner of Volkswagen Group when the 'Volkswagen Law' was amended to abolish the 20% owner veto rights in 2013, with 50.76% ownership. [12]
Volkswagen is a German motor vehicle manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. Founded in 1937 by the German Labour Front, known for their iconic Beetle, it is the flagship brand of the Volkswagen Group, the largest car maker by worldwide sales in 2016 and 2017. The group's biggest market is in China, which delivers 40% of its sales and profits. The German term Volk translates to "people", thus Volkswagen translates to "people's car".
Volkswagen AG, known internationally as the Volkswagen Group, is a German multinational automotive manufacturer headquartered in Wolfsburg, Lower Saxony, Germany. Since the late 2000s, the company is publicly traded but controlled by Porsche SE, which in turn is half-owned and fully controlled by the Austrian-German Porsche and Piëch family. The company designs, manufactures and distributes passenger and commercial vehicles, motorcycles, engines and turbomachinery, as well as offering related services, including financing, leasing and fleet management. In 2016, it was the world's largest automaker by sales, overtaking Toyota and keeping this title in 2017, 2018 and 2019, selling 10.9 million vehicles. It has maintained the largest market share in Europe for over two decades. It ranked seventh in the 2020 Fortune Global 500 list of the world's largest companies.
A Gesellschaft mit beschränkter Haftung is a type of legal entity very common in Germany, Austria, Switzerland, and Liechtenstein. It is an entity broadly equivalent to the private limited company in the United Kingdom and many Commonwealth countries, and the limited liability company (LLC) in the United States. The name of the GmbH form emphasizes the fact that the owners of the entity are not personally liable or credible for the company's debts. GmbHs are considered legal persons under German, Swiss, and Austrian law. Other variations include mbH, and gGmbH for non-profit companies.
Julius Wolff was a German surgeon.
Volkswagen Arena is a football stadium in the German city of Wolfsburg, Lower Saxony. It was opened in 2002 and named after the automotive group Volkswagen AG. The Volkswagen Arena has a capacity of 30,000: 22,000 seats and 8,000 standing places. It is located in the Allerpark and is the home stadium of the football team VfL Wolfsburg.
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Mitbestimmungsgesetz 1976 or the Codetermination Act 1976 is a German law that requires companies of over 2000 employees to have half the supervisory board of directors as representatives of workers, and just under half the votes.
German company law (Gesellschaftsrecht) is an influential legal regime for companies in Germany. The primary form of company is the public company or Aktiengesellschaft (AG). A private company with limited liability is known as a Gesellschaft mit beschränkter Haftung (GmbH). A partnership is called a Kommanditgesellschaft (KG).
Claus Roxin is a German jurist. He is one of the most influential dogmatists of German penal law and has gained national and international reputation in this field. He has been awarded an honorary doctorate by 27 universities around the world as well as the Bundesverdienstkreuz first class.
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Claus-Wilhelm Canaris was a German jurist. Until his retirement in 2005 he was professor of Private Law, Commercial law and Labour law the University of Munich.
Ulrich Seibert is a German jurisprudent, he was head of the division for German company law and corporate governance at the Federal Ministry of Justice and Consumer Protection in Berlin until 8. 2020, and is honorary professor for economic law at the faculty of law of the Heinrich-Heine University of Düsseldorf.
Oliver Blume is a German manager and CEO of Porsche. From September 2022, he will become CEO at Volkswagen AG.
The Handelsgesetzbuch contains the core of the commercial law in Germany. It regulates the legal relations of merchants and therefore it is also designated as "the special private law for merchants".
Fred K. Prieberg was a German musicologist. He was a pioneer in the field of history of music and musicians under the Nazi regime.
The German Law on the Protection of Trade Secrets, or Trade Secrets Law in short, serves to protect business secrets against unauthorized acquisition, use, and disclosure. The law implements the Directive (EU) 2016/943 on the Protection of Trade Secrets in German law. It replaces the right to secrecy, which was previously regulated in §§ 17-19 of the Act Against Unfair Competition.
The Volkswagen Zwickau-Mosel Plant is an automobile factory, which was founded on 26 September 1990 in today's Zwickau district of Mosel and together with the Chemnitz plant and the Transparent Factory belongs to Volkswagen Sachsen based in Zwickau. Currently, the Zwickau plant has about 8,000 employees. Signalling a milestone the last combustion vehicle was produced on 26 June 2020.
Otto Heinrich Greve was a German lawyer by profession and a politician of the German Democratic Party (DDP) and its successor German State Party, the Free Democratic Party and Social Democratic Party of Germany and a member of the German Bundestag.