GERMANY Law and Practice Contributed by: Christoph Nolden, Nicolas Ott, Stefan Mendelin and Thomas Glaser, SZA Schilling, Zutt & Anschütz
2.8 Shareholder Approval There are situations in which a resolution of the general meeting of a stock corporation is required ( Hauptversammlungszuständigkeiten ). Such require- ments are mostly stated in the Stock Corporation Act ( Aktiengesetz , or AktG), but there are also unwritten competences, which have evolved from case law of the German Federal Court ( Bundesgerichtshof ). The responsibilities of the general meeting include, inter alia: • the appointment of the members of the supervisory board and the auditors; • the use of the net profits; • any amendments to the articles of association; • capital increases and decreases; and • the dissolution of the company. Structural changes like capital increases, changes to the articles of association, mergers and transforma- tions or intercompany agreements ( Unternehmensver- träge ) require the consent of the general meeting with a majority of at least three-quarters of the represented share capital. In various cases the articles of associa- tion may stipulate an even greater majority require- ment or reduce the majority threshold. Regarding unwritten competences of the general meeting, the Holzmüller and Gelatine doctrine of the German Federal Court is of importance. According to this, there is an unwritten requirement for the approv- al of the general meeting in cases of any significant structural measures that trigger an effect of mediatisa- tion to the detriment of the shareholders. The thresh- old of significance is exceeded if at least 75% of the company’s assets are affected by a structural meas- ure and/or the company’s actual business is differing from the statutory purpose of the company stated in Shareholders may vote in person or be represented by an authorised representative. Shareholders are gener- ally free to determine their authorised representative. In this regard, in stock corporations it is also permis- sible to appoint an authorised representative who has the articles of association. 2.9 Voting Requirements
is similar for limited liability companies, to a certain extent. There is also no statutory quorum – although the articles of association may provide for a quorum. 2.7 Types of Resolutions and Thresholds Regular resolutions by the general meeting of a stock corporation require a majority of the votes cast. However, for structural measures ‒ such as amend- ments of the articles of association (including capital measures) or measures under the Transformation Act ( Umwandlungsgesetz , or UmwG) (such as mergers, splits, or changes of the legal form) ‒ there are further requirements. As such, the resolution adopted by the general meeting additionally requires a majority of at least 75% of the share capital present at the time of the resolution. The articles of association may impose further require- ments and stipulate a different majority ratio of capital. However, this may only be a greater majority ratio if the matter involves a modification of the companies’ statutory purpose or objects. In limited liability companies, the situation is similar – ie, resolutions of the shareholders’ meeting regularly require a majority of the votes cast. For an amendment to the articles of association, a majority of 75% of the votes cast is required. The majority requirements are mostly determined by the statutes. The articles of association may provide different or further majority requirements. However, regarding stock corporations in particular, the articles of association may only require higher thresholds for passing resolutions. Beyond that, shareholders’ agreements may even provide for further require- ments. Apart from the above-mentioned resolutions to be resolved by all shareholders with voting rights, addi- tional resolutions to be resolved only by certain share- holder groups can be required. By way of example, in addition to the resolution of the general meeting in a stock corporation, a resolution of the holders of pre- ferred shares can be required in special situations (eg, when issuing further preferred shares or when making changes to the rights attached to such shares).
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