Last Updated on May 29, 2021 by LawEuro
Stock Corporation Act (Laws / Regulations of Germany)
Part 6
Group accounting
Sections 329 to 336 (repealed)
Section 337 (repealed)
Section 338 (repealed)
Book 4
Specific provisions, penal provisions, and final provisions
Part 1
Specific provisions applying to cases in which local authorities hold an ownership interest
Section 394
Reports from members of the supervisory board
Members of the supervisory board who have been elected or delegated to same at the instigation of a local authority shall not be under any obligation of secrecy regarding the reports they are to submit to the local authority. This shall not apply to confidential information and secrets of the company, particularly trade secrets or business secrets, if the knowledge of same is not relevant to the purpose of the reports. The reporting obligation pursuant to the first sentence may be based on the law, the by-laws or a legal transaction of which the supervisory board is notified in text form.
Section 395
Obligation of secrecy
(1) Persons to whom the management of the ownership interest held by a local authority has been entrusted, or to whom the task has been entrusted by a local authority to audit the company, the conduct by the local authority in its role as a stockholder, or the activities of the members of the supervisory board who have been elected or delegated to same at the instigation of the local authority, shall respect the secrecy of any confidential information and secrets of the company, particularly trade secrets or business secrets of which they have become aware from reports pursuant to section 394; this shall not apply to notifications made in an official capacity.
(2) Where audit results are published, no confidential information and secrets of the company, particularly trade secrets or business secrets, may be published.
Part 2
Dissolution by the court
Section 396
Pre-requisites
(1) Where a stock corporation or public partly limited partnership jeopardises public welfare by the unlawful conduct of the parties responsible for managing its affairs, and where the supervisory board and the general meeting do not take measures to remove from office such parties managing the affairs of the company, the company may be dissolved by a court judgment upon a corresponding petition having been filed by the responsible supreme Land authority of the Land in which the company has its seat. Solely that regional court (Landgericht) shall have jurisdiction for the complaint in the judicial district of which the company has its seat.
(2) Following its dissolution, the company shall be wound up pursuant to sections 264 to 273. The authority specified in subsection (1), first sentence, may also file the petition for removal from office or appointment of the liquidators for grave cause.
Section 397
Orders issued in the case of dissolution
Where an action has been brought for dissolution, the court may issue the necessary orders, upon a corresponding petition having been filed by the authority specified in section 396 (1), first sentence, by preliminary injunctions.
Section 398
Entry in the register
The court maintaining the register is to be notified of the decisions taken by the court of registration. Insofar as these decisions concern legal relationships the entry in the register of which is obligatory, the court maintaining the register shall enter them in the Commercial Register.
Part 3
Provisions regarding punitive fines and administrative fines. Final provisions
Section 399
False information
(1) Anyone shall be liable to a term of imprisonment not exceeding three (3) years or to payment of a fine who provides false information or conceals significant circumstances in any of the cases set out below:
1. As a founder or as a member of the management board or of the supervisory board, for purposes of entering the company or an agreement pursuant to section 52 (1), first sentence, in the register, concerning the acquisition of the shares of stock, the contribution made for the shares of stock, the appropriation of the amounts paid in, the issue price of the shares of stock, regarding special benefits, formation expenses, contributions in kind and acquisitions of assets, or in the assurance to be given pursuant to section 37a (2), also in conjunction with section 52 (6), third sentence,
2. As a founder or as a member of the management board or of the supervisory board, in the formation report, the report on post-formation agreements, or in the audit report,
3. In the public announcement pursuant to section 47 no. 3,
4. As a member of the management board or of the supervisory board, for purposes of entering an increase of the share capital (sections 182 to 206) in the register, concerning the contribution of the current capital, the subscription or contribution of the new capital, the issue price of the shares of stock, the issuance of the shares of a new issue, regarding contributions in kind, in the notice published pursuant to section 183a (2), first sentence, in conjunction with section 37a (2), or in the assurance to be given pursuant to section 184 (1), third sentence,
5. As a liquidator, for purposes of entering in the register the continuation of the company, in the proof to be provided pursuant to section 274 (3), or
6. As a member of the management board of a stock corporation or of the executive body of a foreign legal entity, in the assurance to be given pursuant to section 37 (2), first sentence, or section 81 (3), first sentence, or as a liquidator in the assurance to be given pursuant to section 266 (3), first sentence.
(2) Likewise, anyone shall be liable to punishment who, as a member of the management board or of the supervisory board, provides untrue information in the declaration stipulated by section 210 (1), second sentence, for purposes of entering an increase of the share capital in the register.
Section 400
False representation of facts
(1) Anyone shall be liable to a term of imprisonment not exceeding three (3) years or to payment of a fine who, as a member of the management board or of the supervisory board or as a liquidator:
1. Incorrectly represents or conceals the circumstances of the company including its relations with affiliated enterprises in depictions or summaries of the company’s net asset position, in presentations to the general meeting or in informational statements to same, unless the deed is liable to punishment under section 331 no. 1 or no. 1a of the Commercial Code (HGB); or who
2. Provides false information, or incorrectly represents or conceals the circumstances of the company in any clarification statement or proof to be provided, according to the regulations of the present Act, to an auditor of the company or of an affiliated enterprise, unless the deed is liable to punishment under section 331 no. 4 of the Commercial Code (HGB).
(2) Likewise, anyone shall be liable to punishment who, as a founder or stockholder, provides false information or conceals significant circumstances in any clarification statements or proof to be provided to a formation auditor or any other auditor pursuant to the regulations of the present Act.
Section 401
Dereliction of duties in the cases of loss, over-indebtedness, or inability to pay debts as they fall due
(1) Anyone shall be liable to a term of imprisonment not exceeding three (3) years or to payment of a fine who, as a member of the management board, in contravention of section 92 (1), fails to convene the general meeting and to notify it in the event of a loss amounting to half of the share capital.
(2) Where the perpetrator has acted negligently, the punishment shall be a term of imprisonment not exceeding one (1) year or payment of a fine.
Section 402
False issuance of proof of entitlement
(1) Anyone shall be liable to a term of imprisonment not exceeding three (3) years or to payment of a fine who falsely issues, or falsifies, certificates intended to provide evidence of the voting right at a general meeting or at a separate meeting, unless other regulations governing criminal offences involving records and documents subject the deed to stricter punishment.
(2) Likewise, anyone shall be liable to punishment who uses a falsely issued or falsified certificate of the nature designated in subsection (1) in order to exercise the voting right.
(3) The attempt is liable to punishment.
Section 403
Violation of reporting obligations
(1) Anyone who, as the auditor or as the agent of an auditor, submits an incorrect report of the results obtained in an audit or who fails to disclose significant circumstances in the report shall be liable to a term of imprisonment not exceeding three (3) years or to payment of a fine.
(2) Where the perpetrator has acted in return for remuneration or with the intention of enriching himself or some other party or of causing damage to some other party, the punishment shall consist of a term of imprisonment not exceeding five (5) years or of the payment of a fine.
Section 404
Violation of the obligation to maintain confidentiality
(1) Anyone disclosing a secret of the company without having been authorised to do so, namely a trade or business secret, of which he has become aware in his capacity as:
1. A member of the management board or of the supervisory board or a liquidator,
2. An auditor or as the agent of an auditor
shall be liable to a term of imprisonment not exceeding one (1) year, in the case of companies listed on the stock exchange to a term of imprisonment not exceeding two (2) years, or to payment of a fine; in the case of no. 2, however, he shall be so liable only if the deed is not punishable pursuant to section 333 of the Commercial Code (HGB).
(2) Where the perpetrator is acting in return for remuneration or with the intention of enriching himself or some other party or of causing damage to some other party, he shall be liable to a term of imprisonment not exceeding two (2) years, in the case of companies listed on the stock exchange to a term of imprisonment not exceeding three (3) years, or to payment of a fine. Likewise, anyone shall be liable to punishment who, without having been authorised to do so, exploits a secret of the type designated in subsection (1), namely a trade or business secret, of which he has become aware subject to the pre-requisites set out in subsection (1).
(3) The offence shall be prosecuted only upon an application having been filed by the company. Where a member of the management board or a liquidator has committed the deed, the supervisory board shall be entitled to file the corresponding petition; where a member of the supervisory board has committed the deed, the members of the management board or the liquidators shall be entitled to file the corresponding petition.
Section 404a
Violation of the obligations entailed by the auditing of accounts
(1) Anyone shall be liable to a term of imprisonment not exceeding one (1) year or to payment of a fine who, as a member of the supervisory board or as a member of an audit committee of a company that is publicly traded in the sense of section 264d of the Commercial Code (HGB), that is a credit institution as defined by the Capital Requirements Regulation (CRR) in the sense of section 1 (3d), first sentence, of the Banking Act (KWG), to the exception of the institutions named in section 2 (1) nos. 1 and 2 of the Banking Act, or that is an insurance undertaking in the sense of Article 2 paragraph 1 of the Council Directive 91/674/EEC of 19 December 1991 on the annual account and consolidated accounts of insurance undertakings (OJ L 374 of 31 December 1991, p. 7), last amended by Directive 2006/46/EC (OJ L 224 of 16 August 2006, p. 1),
1. Commits an act designated in section 405 (3b), thus obtaining a material benefit or having such a material benefit promised to him, or who
2. Persistently commits an act designated in section 405 (3b).
(2) Likewise, anyone shall be liable to punishment who, as a member of the supervisory board or as a member of an audit committee of a company that is publicly traded in the sense of section 264d of the Commercial Code (HGB) or that is a credit institution as defined by the Capital Requirements Regulation (CRR) in the sense of section 1 (3d), first sentence, of the Banking Act (KWG), to the exception of the institutions named in section 2 (1) nos. 1 and 2 of the Banking Act,
1. Commits an act designated in section 405 subsection (3c) or subsection (3d), thus obtaining a material benefit or having such a material benefit promised to him, or who
2. Persistently commits an act designated in section 405 subsection (3c) or subsection (3d).
Section 405
Administrative offences
(1) Anyone shall be committing an administrative offence who, as a member of the management board or of the supervisory board or as a liquidator,
1. Issues registered shares of stock, the share certificates of which do not set out the amount of the partial payments made, or issues bearer shares prior to their issue price having been fully paid in.
2. Issues share certificates or temporary share certificates prior to the company having been entered in the register, or, in the case of a capital increase, prior to the implementation of such increase of the share capital having been entered, or, in the case of a conditional capital increase or of a capital increase using company funds, prior to the resolution adopted as to the conditional capital increase or the capital increase using company funds having been entered in the Commercial Register,
3. Issues share certificates or temporary share certificates in a lower amount than the minimum nominal amount permissible pursuant to section 8 (2), first sentence, or share certificates or temporary share certificates to which, in the case of a company with no-par-value shares, a lower stake in the share capital is allocated than the minimum amount permissible pursuant to section 8 (3), third sentence, or
4.
a) Purchases treasury shares of stock in the company in contravention of section 71 subsection (1) nos. 1 to 4 or subsection (2) or, in conjunction with section 71e (1), accepts them in pledge,
b) Fails to offer treasury shares of stock that are to be disposed of (section 71c subsections (1) and (2)), or
c) Fails to take the measures required to prepare for the adoption of the resolution as to the redemption of treasury shares of stock (section 71c (3)).
5. (repealed)
(2) Anyone shall be committing an administrative offence as well who, as a stockholder or as the representative of a stockholder, fails to provide the particulars to be included in the list pursuant to section 129 or does not provide accurate particulars.
(2a) Anyone shall be committing an administrative offence who, contrary to section 67 (4), second sentence, and also in conjunction with the third sentence, fails to submit a notification or does not submit a correct notification.
(3) Furthermore, anyone shall be committing an administrative offence who
1. Uses shares of stock belonging to some other party that he does not have authority to represent, and without that party’s consent, in order to exercise rights at the general meeting or at a separate meeting,
2. Uses shares of stock belonging to some other party in order to exercise rights at the general meeting or at a separate meeting, having procured such shares of stock for this purpose by granting or promising special benefits,
3. Surrenders shares of stock to some other party for the purpose designated in no. 2 in return for special benefits being granted or promised to him,
4. Uses shares of stock belonging to some other party, regarding which he or the party he is representing may not exercise the voting right pursuant to section 135, in order to exercise the voting right,
5. Surrenders shares of stock to some other party, regarding which he or the party he is representing may not exercise the voting right pursuant to section 20 (7), section 21 (4), sections 71b, 71d, fourth sentence, section 134 (1), sections 135, 136, 142 (1), second sentence, section 285 (1), for purposes of exercising the voting right, or uses such shares of stock surrendered to him to exercise the voting right,
6. Demands special benefits as counter-performance, or has such special benefits promised to him, or accepts them, in return for not casting a vote, or casting it in a certain sense, when a vote is taken at the general meeting or at a separate meeting, or
7. Offers, promises, or grants special benefits as counter-performance in return for someone not casting a vote, or casting it in a certain sense, when a vote is taken at the general meeting or at a separate meeting.
(3a) Anyone shall be committing an administrative offence who intentionally or recklessly
1. Fails to forward the invitation convening the general meeting, in contravention of section 121 (4a), first sentence, also in conjunction with section 124 (1), third sentence, or does not properly forward it or not completely, or fails to forward it in due time, or
2. Who, in contravention of section 124a, fails to make accessible information, or does not properly make it accessible, or not completely.
(3b) Anyone shall be committing an administrative offence who, as a member of the supervisory board or as a member of an audit committee of a company that is publicly traded in the sense of section 264d of the Commercial Code (HGB), that is a credit institution as defined by the Capital Requirements Regulation (CRR) in the sense of section 1 (3d), first sentence, of the Banking Act (KWG), to the exception of the institutions named in section 2 (1) nos. 1 and 2 of the Banking Act, or that is an insurance undertaking in the sense of Article 2 paragraph 1 of the Council Directive 91/674/EEC of 19 December 1991 on the annual account and consolidated accounts of insurance undertakings (OJ L 374 of 31 December 1991, p. 7), last amended by Directive 2006/46/EC (OJ L 224 of 16 August 2006, p. 1),
1. Fails to monitor the independence of the auditor or audit firm subject to the stipulations of Article 4 paragraph 3 subparagraph 2, of Article 5 paragraph 4 subparagraph 1, first sentence, or of Article 6 paragraph 2 of Regulation (EU) No 537/2014 of the European Parliament and of the Council of 16 April 2014 on specific requirements regarding statutory audit of public-interest entities and repealing Commission Decision 2005/909/EC (OJ L 158 of 27 May 2014, p. 77, L 170 of 11 June 2014, p. 66) or
2. Submits a recommendation for the appointment of an auditor or an audit firm that is not based on a demand made by the supervisory authority pursuant to section 36 (1), second sentence, of the Act on the Supervision of Insurance Enterprises (Versicherungsaufsichtsgesetz) and
a) That fails to meet the requirements set out in Article 16 paragraph 2 subparagraph 2 or 3 of Regulation (EU) No 537/2014, or
b) That has not been preceded by a selection procedure pursuant to Article 16 paragraph 3 subparagraph 1 of Regulation (EU) No 537/2014.
(3c) Anyone shall be committing an administrative offence who, as a member of a supervisory board of a company that is publicly traded in the sense of section 264d of the Commercial Code (HGB) or that is a credit institution as defined by the Capital Requirements Regulation (CRR) in the sense of section 1 (3d), first sentence, of the Banking Act (KWG), to the exception of the institutions named in section 2 (1) nos. 1 and 2 of the Banking Act, where such supervisory board has not appointed an audit committee, submits a suggestion to the general meeting for the appointment of an auditor or an audit firm that fails to meet the requirements set out in Article 16 paragraph 5 subparagraph 1 of Regulation (EU) No 537/2014.
(3d) Anyone shall be committing an administrative offence who, as a member of a supervisory board of a company of the type set out in subsection (3c), which supervisory board has appointed an audit committee, submits a suggestion to the general meeting for the appointment of an auditor or an audit firm that fails to meet the requirements set out in Article 16 paragraph 5 subparagraph 1 or subparagraph 2, first sentence or second sentence, of Regulation (EU) No 537/2014.
(4) In the cases governed by subsections (3b) to (3d), the administrative offence is punishable by a fine of up to fifty thousand (50,000) euros, in the other cases by a fine not exceeding twenty-five thousand (25,000) euros.
(5) The Federal Financial Supervisory Authority (BAFin) is the administrative authority in the sense of section 36 (1) no. 1 of the Act on Regulatory Offences (OWiG) in the cases governed by subsections (3b) to (3d) for credit institutions as defined by the Capital Requirements Regulation (CRR) in the sense of section 1 (3d), first sentence, of the Banking Act (KWG), to the exception of the institutions named in section 2 (1) nos. 1 and 2 of the Banking Act, and for insurance undertakings in the sense of Article 2 paragraph 1 of Council Directive 91/674/EEC, in all other regards, the Federal Office of Justice (BfJ) is said administrative authority.
Section 406 (repealed)
Section 407
Coercive penalty payments
(1) Where members of the management board or liquidators fail to comply with section 52 (2), second to fourth sentences, section 71c, section 73 (3), second sentence, sections 80, 90, 104 (1), section 111 (2), section 145, sections 170, 171 subsection (3) or subsection (4), first sentence, in conjunction with subsection (3), sections 175, 179a (2), first to third sentences, section 214 (1), section 246 (4), sections 248a, 259 (5), section 268 (4), section 270 (1), section 273 (2), sections 293f, 293g (1), section 312 (1), section 313 (1), section 314 (1), the court of registration maintaining the register is to induce them to comply with said regulations by levying a coercive penalty payment against them; section 14 of the Commercial Code (HGB) shall remain unaffected. The individual coercive penalty payment may not be levied in an amount in excess of 5,000 euros.
(2) The applications for entry in the Commercial Register pursuant to sections 36, 45, 52, 181 (1), sections 184, 188, 195, 210, 223, 237 (4), sections 274, 294 (1), section 319 (3) shall not be enforced by levying a coercive penalty payment.
Section 407a
Notifications to the auditing oversight body
(1) The administrative authority competent pursuant to section 405 (5) shall transmit to the auditing oversight body with the Federal Office for Economic Affairs and Export Control (Bundesamt für Wirtschaft und Ausfuhrkontrolle) all decisions as to fines pursuant to section 405 subsections (3b) to (3d).
(2) In criminal proceedings, the subject of which is an offence pursuant to section 404a, and in which public charges have been preferred, the public prosecutor’s office shall transmit to the auditing oversight body the decision concluding the proceedings. Where an appellate remedy is sought against the decision, the decision is to be transmitted with reference being made to the remedy being sought.
Section 408
Liability to punishment of general partners of a public partly limited partnership
Sections 399 to 407 shall apply mutatis mutandis to the public partly limited partnership. To the extent they concern members of the management board, they shall apply, in the case of a public partly limited partnership, to the general partners.
Section 409
Application in Berlin
The present Act shall apply, subject to the stipulations made in section 13 (1) of the Third Transitory Law (Drittes Überleitungsgesetz) of 4 January 1952 (Federal Law Gazette (Bundesgesetzblatt) I p. 1) also in the Land of Berlin. Any ordinances having the force of law enacted by reason of the present Act shall apply in the Land of Berlin pursuant to section 14 of the Third Transitory Law.
Section 410
Entry into force
This Act shall enter into force on 1 January 1966.
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