Last Updated on May 29, 2021 by LawEuro
Stock Corporation Act (Laws / Regulations of Germany)
Book 1
Stock corporation
Part 1
General regulations
Section 1
Nature of the stock corporation
(1) The stock corporation is a company having a legal personality of its own. Solely the company’s assets shall be liable to the creditors of the company for its obligations.
(2) The share capital of the stock corporation is divided up into shares of stock.
Section 2
Number of founders
One or several of the individuals acquiring the shares of stock in return for payment of a contribution must be involved in establishing the articles of association (the by-laws).
Section 3
Merchant status conferred by law. Stock exchange listing
(1) The stock corporation is deemed a trading company even if the purpose of the enterprise does not consist of carrying on a trade.
(2) Companies listed on the stock exchange in the sense of the present Act are companies whose shares of stock are admitted to trading on a market that is regulated and monitored by officially recognised bodies, that takes place on a regular basis, and that is indirectly or directly accessible to the general public.
Section 4
Business name
The business name of the stock corporation must include the designation “Aktiengesellschaft” (stock corporation), or a generally understandable abbreviation of this designation, regardless of whether or not the business name continues to be used pursuant to section 22 of the Commercial Code (HGB) or pursuant to any other statutory regulations.
Section 5
Seat
The company’s seat is that location within Germany that has been determined as such in the by-laws.
Section 6
Share capital
The nominal amount of the share capital must be denominated in euros.
Section 7
Minimum nominal amount of the share capital
The minimum nominal amount of the share capital is fifty thousand euros.
Section 8
Form and minimum values of shares of stock
(1) The shares of stock may be created either as par-value shares or as no-par-value shares.
(2) Par-value shares must have a value of at least one (1) euro. Any shares of stock having a lower nominal amount are null and void. The issuers of shares of stock shall be liable as joint and several debtors to the holders of such shares for any damages resulting from the issuance. Where the nominal amounts of the shares of stock are higher, they must be denominated in full euros.
(3) No nominal amount shall attach to no-par-value shares. The no-par-value shares of a company represent equal portions of its share capital. The stake in the share capital allocated to the individual no-par-value share may not be lower than one (1) euro. Subsection (2), second and third sentences, shall apply mutatis mutandis.
(4) For par-value shares, the portion of the share capital they represent shall be determined based on the ratio between their nominal amount and the share capital, while for no-par-value shares, it shall be determined based on the number of shares of stock.
(5) The shares of stock shall be indivisible.
(6) The above regulations shall also apply to share participation certificates allotted to stockholders prior to the issuance of the shares of stock (temporary share certificates).
Section 9
Issue price of the shares of stock
(1) Shares of stock may not be issued at a price lower than their nominal amount or lower than the stake in the share capital allocated to the no-par-value share (minimum issue price).
(2) Shares of stock may permissibly be issued at a higher price.
Section 10
Shares of stock and temporary share certificates
(1) The shares of stock are registered in the names of their holders. They may be issued as bearer shares if
1. The company is listed on the stock exchange, or
2. The claim to individual certification of the ownership interest is precluded and the global certificate is deposited with any one of the following bodies:
a) A securities clearing and deposit bank in the sense of section 1 (3), first sentence, of the Securities Deposit Act (Depotgesetz),
b) An accredited central securities depository or a recognised third-country central securities depository pursuant to Regulation (EU) No 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving securities settlement in the European Union and on central securities depositories and amending Directives 98/26/EC and 2014/65/EU and Regulation (EU) No. 236/2012 (OJ L 257 of 28 August 2014, p. 1), or
c) Some other foreign depository complying with the pre-requisites set out in section 5 (4), first sentence, of the Securities Deposit Act.
For as long as, in the case described in the second sentence, no. 2, hereof, the global certificate has not been deposited, section 67 shall apply mutatis mutandis.
(2) The shares of stock must be registered in the names of their holders if they are issued prior to the issue price having been fully paid in. The share certificate is to set out the amount of the partial payments made.
(3) Temporary share certificates must be registered in the names of their holders.
(4) Temporary share certificates issued as bearer certificates are null and void. The issuers shall be liable as joint and several debtors to the holders for any damages resulting from the issuance.
(5) The by-laws may preclude or restrict the entitlement of a stockholder to claim individual certification of the ownership interest held.
Section 11
Shares of particular classes of stock
The shares of stock may confer different rights, namely as concerns the distribution of profits and the company’s assets. Shares of stock having the same rights shall form a class of stock.
Section 12
Voting right. No multiple voting rights
(1) Each share of stock shall confer the right to vote. According to the regulations of the present Act, preferential stock may be issued as shares of stock without a voting right.
(2) Multiple voting rights are impermissible.
Section 13
Signature on share certificates
It shall suffice for shares of stock and temporary share certificates to be signed by a reproduced signature. The validity of the signature may be made dependent on the observance of a particular form. The requirement as to form must be set out in the certificate.
Section 14
Jurisdiction
Unless otherwise determined, the term “court” as used in the present Act shall refer to the court having jurisdiction at the company’s seat.
Section 15
Affiliated enterprises
Affiliated enterprises are legally independent enterprises that, in their relationship inter se, are enterprises in which a majority ownership interest is held and enterprises which hold a majority of the ownership interest (section 16), controlled and controlling enterprises (section 17), group member companies (section 18), cross-shareholding enterprises (section 19), or parties to an inter-company agreement (sections 291, 292).
Section 16
Enterprises in which a majority ownership interest is held and enterprises holding a majority of the ownership interest
(1) Where the majority of the shares in a legally independent enterprise belongs to some other enterprise, or where some other enterprise is entitled to the majority of the voting rights (majority interest), the legally independent enterprise is an enterprise in which a majority ownership interest is held, while the other enterprise is an enterprise holding a majority of the ownership interest in same.
(2) The question of which portion of the shares belongs to an enterprise shall be determined, for share capital companies, based on the ratio between the aggregate nominal amount of the shares owned by the enterprise and the nominal capital of the company limited by shares, and for companies that have issued no-par-value shares, it shall be determined based on the number of shares of stock. Treasury shares are to be left unconsidered in determining the nominal capital of share capital companies, and in determining the number of shares of stock in companies that have issued no-par-value shares. Those shares that belong to some other party for the account of the enterprise shall be equivalent to treasury shares of the enterprise.
(3) The portion of the voting rights to which an enterprise is entitled shall be determined based on the ratio between the number of voting rights that the enterprise may exercise based on the shares belonging to it and the aggregate number of all voting rights. The voting rights conferred by treasury shares and by shares that are equivalent to treasury shares according to subsection (2), third sentence, are not to be included in the aggregate number of all voting rights.
(4) Shares will be deemed to be treasury shares of an enterprise also if they belong to an enterprise controlled by that enterprise, or if they belong to another party for the account of that enterprise, or for the account of an enterprise under its control; where the owner of the enterprise is a sole trader, those shares forming the owner’s other assets likewise will be deemed to be treasury shares.
Section 17
Controlled and controlling enterprises
(1) Controlled enterprises are legally independent enterprises on which some other enterprise (controlling enterprise) is able to directly or indirectly exert a controlling influence.
(2) Where a majority ownership interest is held in an enterprise, the assumption is that said enterprise is controlled by the enterprise holding a majority ownership interest in same.
Section 18
Group of enterprises and group member companies
(1) Where a controlling enterprise and one or several controlled enterprises are combined under the common management of the controlling enterprise, they form a group; the individual enterprises are group member companies. Where a control agreement is in place between enterprises (section 291), or where one enterprise has been integrated into another (section 319), the enterprises are to be regarded as enterprises combined under common management. The assumption is that a controlled enterprise forms a group with the controlling enterprise.
(2) Where legally independent enterprises are combined under common management without one enterprise being controlled by the other, they likewise form a group of enterprises; the individual enterprises are group member companies.
Section 19
Cross-shareholding enterprises
(1) Cross-shareholding enterprises are enterprises legally structured as a share capital company that have their seat in Germany and are affiliated with each other as a result of each enterprise owning more than one quarter of the shares of stock in the respective other enterprise. Section 16 subsection (2), first sentence, and subsection (4) shall apply in establishing whether or not an enterprise owns more than one quarter of the shares of stock in the respective other enterprise.
(2) Where a cross-shareholding enterprise holds a majority interest in the other enterprise, or where one enterprise is able to indirectly or directly exert a controlling influence on the other enterprise, the former is to be regarded as the controlling enterprise and the latter is to be regarded as the controlled enterprise.
(3) Where each of the cross-shareholding enterprises holds a majority interest in the respective other enterprise, or where each enterprise is able to indirectly or directly exert a controlling influence on the respective other enterprise, both enterprises shall be deemed to be controlling and controlled enterprises.
(4) Section 328 does not apply to enterprises that are controlling or controlled enterprises pursuant to subsection (2) or subsection (3).
Section 20
Notification obligations
(1) As soon as more than one quarter of the shares in a stock corporation having its seat in Germany belongs to an enterprise, said enterprise is to notify the company of this fact without undue delay and in writing. Section 16 subsection (2), first sentence, and subsection (4) shall apply in establishing whether more than one quarter of the shares of stock belongs to an enterprise.
(2) For purposes of the notification obligation pursuant to subsection (1), the shares of stock belonging to the enterprise shall also include those shares of stock
1. Regarding which the enterprise, an enterprise under its control, or some other party acting for the account of the enterprise, or for the account of an enterprise under its control, may demand that title to such shares be transferred;
2. That the enterprise, an enterprise under its control, or some other party acting for the account of the enterprise, or for the account of an enterprise under its control, is obliged to purchase.
(3) Where the enterprise is a share capital company, it is to also notify the company, without undue delay and in writing, as soon as it holds more than a quarter of the shares of stock, not including the shares governed by subsection (2).
(4) As soon as the enterprise holds a majority interest (section 16 (1)), it is to notify the company of this fact as well, and shall do so without undue delay and in writing.
(5) Where the ownership interest ceases to exist in the amount requiring notification pursuant to subsections (1), (3), or (4), the company is to be notified of this fact without undue delay and in writing.
(6) The company is to give notice of the existence of an ownership interest, of which it has been notified pursuant to subsection (1) or (4), in its publications of record and shall do so without undue delay; in this context, the enterprise holding said ownership interest is to be identified. If the company is notified that the ownership interest has ceased to exist in an amount requiring notification pursuant to subsection (1) or (4), notice of this fact as well shall be given without undue delay in the company’s publications of record.
(7) No rights attaching to shares of stock belonging to an enterprise that is subject to the notification obligation pursuant to subsection (1) or (4) shall exist, neither for the enterprise nor for an enterprise under its control, nor for some other party acting for the account of the enterprise, or for the account of an enterprise under its control, for as long as the enterprise fails to comply with the notification obligation. This shall not apply to any claims governed by section 58 (4) and section 271, provided the failure to provide notification was not intentional and the notification has been subsequently provided.
(8) Subsections (1) to (7) shall not apply to shares of stock of an issuer in the sense of section 33 (4) of the Securities Trading Act (WpHG).
Section 21
Notification obligations of the company
(1) As soon as the company holds more than a quarter of the shares in some other share capital company having its seat in Germany, it is to notify the respective enterprise in which it holds such ownership interest, and shall do so without undue delay and in writing. Section 16 subsection (2), first sentence, and subsection (4) shall apply mutatis mutandis in establishing whether the company owns more than a quarter of the shares.
(2) As soon as the company holds a majority interest (section 16 (1)) in some other enterprise, it is to notify the enterprise in which it holds such majority interest, and shall do so without undue delay and in writing.
(3) Where the ownership interest has ceased to exist in the amount requiring notification pursuant to subsection (1) or (2), the company is to notify the other enterprise, and shall do so without undue delay and in writing.
(4) No rights attaching to shares belonging to a company that is subject to the notification obligation pursuant to subsection (1) or (2) shall exist for as long as the company fails to comply with the notification obligation. Section 20 (7), second sentence, shall apply mutatis mutandis.
(5) Subsections (1) to (4) shall not apply to shares of stock of an issuer in the sense of section 33 (4) of the Securities Trading Act (WpHG).
Section 22
Proof of ownership interest regarding which a notification has been issued
An enterprise that has been notified pursuant to section 20 subsections (1), (3), or (4), or pursuant to section 21 subsection (1) or (2), may demand at any time that it be provided with proof of the existence of the ownership interest.
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