Last Updated on May 29, 2021 by LawEuro
Stock Corporation Act (Laws / Regulations of Germany)
Subchapter 4
Voting right
Section 133
Principle of the simple majority of the votes cast
(1) The resolutions adopted by the general meeting shall require the majority of the votes cast (simple majority) unless the law or the by-laws stipulate a greater majority ratio or impose further requirements.
(2) The by-laws may make other provisions for elections.
Section 134
Voting right
(1) The voting right is exercised based on the nominal amounts of the shares of stock, and in the case of no-par-value shares based on their number. In the event that a stockholder owns several shares of stock, the by-laws of a company not listed on the stock exchange may limit the voting right by specifying a maximum amount, or a set of threshold amounts. Furthermore, the by-laws may determine that those shares of stock shall be counted as belonging to the stockholder that belong to some other party for the stockholder’s account. In the case of the stockholder being an enterprise, the by-laws may further determine that those shares of stock shall be counted as shares of stock belonging to the stockholder that belong to an enterprise controlled by the stockholder, or an enterprise controlling the stockholder, or an enterprise affiliated with the stockholder in a group of companies, or that belong to a third party for the account of such enterprises. The restrictions may not be imposed for individual stockholders. The restrictions shall not be taken into account in calculating a majority ratio of capital required by law or the by-laws.
(2) The voting right shall commence upon the contribution having been made in full. Where the value of a hidden contribution in kind does not correspond to the value set out in section 36a (2), third sentence, then this shall not contravene the commencement of the voting right; this shall not apply to obvious differences in value. The by-laws may stipulate that the voting right commences upon the statutory minimum contribution having been made, or whichever higher minimum contribution is specified in the by-laws. In such event, making the minimum contribution shall grant one vote; in the case of higher contributions, the proportion of votes shall be governed by the amount of the contributions made. Where the by-laws do not stipulate that the voting right commences prior to the contribution having been made in full, and where the contribution has not yet been made in full for any share of stock, the proportion of votes shall be governed by the amount of the contributions made; in this context, making the minimum contribution shall grant one vote. Fractions of votes shall be taken into account in these cases only insofar as they result in full votes for the stockholder entitled to vote. The by-laws may not make any provisions pursuant to this subsection for individual stockholders or for individual classes of stock.
(3) The voting right may be exercised by an authorised representative. Where the stockholder authorises more than one person, the company may refuse to accept one or several of these proxies. The granting of the power of attorney, its revocation, and the proof regarding the authorisation to be submitted to the company all must be in text form, unless stipulated otherwise in the by-laws or in the invitation convening the general meeting based on an authorisation set out in the by-laws, and unless eased requirements have been established in the case of companies listed on the stock exchange. At a minimum, the company listed on the stock exchange is to offer a means of electronic communication for transmitting proof. Where representatives exercising voting rights who have been named by the company are authorised, the company is to keep a verifiable record of the declaration of power of attorney for three (3) years; section 135 (5) shall apply mutatis mutandis.
(4) The by-laws shall govern the form in which the voting right is exercised.
Section 135
Exercise of the voting right by credit institutions and commercial proxy services
(1) A credit institution may exercise the voting right for shares of stock that do not belong to it, and regarding which it is not entered in the share register as a holder, only if it has been granted power of attorney. The power of attorney may only be granted to a specified credit institution, which must keep a verifiable record of it. The declaration of power of attorney must be complete and may only set out declarations connected to the exercise of the voting right. Where the stockholder does not issue any express instructions, a general power of attorney may provide only that the credit institution is authorised to exercise the voting right:
1. In accordance with its own vote guidance (subsections (2) and (3)), or
2. In accordance with guidance from the management board or from the supervisory board or, in the case of the guidance from the management board deviating from that of the supervisory board, in accordance with guidance from the supervisory board (subsection (4)).
Where the credit institution offers to exercise the voting right pursuant to the fourth sentence, no. 1 or no. 2, then it is to concurrently tender the service, within the scope of what can be reasonably be expected of it and until revoked, of forwarding to an association of stockholders or to any other representative for whom the stockholder may opt, the documents required for exercising the voting right. Each year, the credit institution is to indicate to the stockholder the opportunities available for revoking the power of attorney at any point in time and to change the authorised representative; this indication is to be set out prominently in the communication. The issuance of instructions as regards the individual items of business set out in the agenda, the granting and revocation of a general power of attorney pursuant to the fourth sentence, and the award of a contract pursuant to the fifth sentence, including any changes thereto, are to be facilitated for the stockholder by providing him with a form or an onscreen form.
(2) A credit institution intending to exercise the voting right on the basis of a power of attorney pursuant to subsection (1), fourth sentence, no. 1 is to make accessible to the stockholder, in due time, its own guidance for exercising the voting right as regards the individual items of business set out in the agenda. In developing this guidance, the credit institution is to be oriented by the interests of the stockholder and is to take organisational measures to ensure that no interests of other business units influence this guidance; it is to appoint a member of the management that is to supervise compliance with these obligations as well as the due and proper exercise of the voting right and its documentation. In providing its guidance, the credit institution is to indicate that it will exercise the voting right in accordance with its own guidance unless the stockholder issues other instructions in due time. Where a member of the management board or an employee of the credit institution is a member of the company’s supervisory board or where a member of the management board or an employee of the company is a member of the credit institution’s supervisory board, the credit institution is to indicate this fact. The same shall apply if the credit institution holds an ownership interest in the company that section 33 of the Securities Trading Act (WpHG) requires to be registered or if it was a member of a consortium that has assumed the last issuance, in terms of time, of securities of the company made in the past five (5) years.
(3) Where the stockholder has not issued any instructions to the credit institution on how to exercise the voting right, then the credit institution is to exercise the voting right, in the case governed by subsection (1), fourth sentence, no. 1 in accordance with its own guidance, unless it is in its rights to assume, based on the circumstances, that, were the stockholder aware of the facts and circumstances, he would endorse the voting rights being exercised in derogation from the credit institution’s guidance. Where the credit institution has deviated, in exercising the voting right, from instructions issued by the stockholder or, if the stockholder has not issued any instructions, from its own guidance, it is to inform the stockholder of this fact while citing the grounds for doing so. At its own general meeting, the credit institution to which power of attorney has been granted may exercise the voting right conferred upon it by the power of attorney only insofar as the stockholder has issued express instructions concerning the individual items of business set out in the agenda. The same shall apply at the general meeting of a company in which the credit institution holds more than 20 percent, directly or indirectly, of the share capital; in computing the level of a holding, indirect holdings in the sense of section 35 subsection (3) through subsection (6) of the Securities Trading Act (WpHG) shall not be taken into account.
(4) A credit institution intending to exercise at a general meeting the voting right based on a power of attorney pursuant to subsection (1), fourth sentence, no. 2 must make accessible to the stockholders the guidance issued by the management board and the supervisory board, unless this is effected in some other manner. Subsection (2), third sentence, as well as subsection (3), first to third sentences, shall apply mutatis mutandis.
(5) Where the power of attorney so permits, the credit institution may grant sub-power of attorney to persons who are not its employees. Unless specified otherwise by the power of attorney, the credit institution shall exercise the voting right on behalf of the party entitled to such voting right. Where the company has permitted a postal vote to be submitted, the credit institution having been granted power of attorney may avail itself of this option. In order to provide the company with proof of its authorisation to vote, it shall suffice, in the case of companies listed on the stock exchange, to submit proof of authorisation pursuant to section 123 (3); in all other cases, the requirements set out in the by-laws for exercising the voting right are to be met.
(6) A credit institution may exercise the voting right for registered shares of stock that do not belong to it, but regarding which it is entered in the share register as holder, only based on an authorisation. Subsections (1) to (5) are to be correspondingly applied to the authorisation.
(7) The validity of the vote will not be impaired by a violation of subsection (1), second to seventh sentences, or of subsections (2) to (6).
(8) Subsections (1) to (7) shall apply mutatis mutandis to associations of stockholders and to persons who tender the service commercially to stockholders of exercising their voting right at the general meeting; this shall not apply if the party intending to exercise the voting right is the legal representative, spouse, or partner in a civil union of the stockholder or is related within the fourth degree by consanguinity or affinity.
(9) The duty of the credit institution to provide compensation for any damage resulting from a violation of subsections (1) to (6) may not be precluded in advance, nor may it be limited in advance.
(10) Section 125 (5) shall apply mutatis mutandis.
Section 136
Suspension of the voting right
(1) No-one may exercise the voting right for himself or for some other party if the resolution to be adopted concerns the question of whether his actions are to be approved and he is to be granted discharge, or whether he is to be released from a liability, or whether the company is to assert a claim against him. The voting right for shares of stock not entitling the stockholder to exercise the voting right pursuant to the first sentence may not be exercised by some other party, either.
(2) Any contract is null and void by which a stockholder enters into obligation to exercise the voting right in accordance with instructions issued by the company or by the management board or the supervisory board of the company, or in accordance with instructions issued by a controlled enterprise. Likewise, a contract is null and void by which a stockholder enters into obligation to vote in accordance with the guidance provided by the management board or the supervisory board of the company.
Section 137
Votes on nominations by stockholders
Where a stockholder has nominated a candidate for the supervisory board pursuant to section 127 and moves at the general meeting that the candidate be elected, then his motion shall be resolved upon prior to the nomination made by the supervisory board, provided that a minority of the stockholders so demands whose shares of stock, in the aggregate, are at least equivalent to one tenth of the share capital represented.
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