GERMANY Law and Practice Contributed by: Marc Löbbe, Michaela Balke, Oliver Schröder and Martin Kolbinger, SZA Schilling, Zutt & Anschütz
• acquiring shares in the joint venture vehicle previ - ously held by the seller; • joining as a new shareholder in such vehicle by way of a capital increase; or • establishing a new joint venture entity to which the seller transfers the existing business. The transaction part of setting up a joint venture usu - ally involves similar steps as a standard M&A transac - tion, such as non-disclosure arrangements and a due diligence review of the existing business. The co-operation side of the deal consists of setting up the joint venture structure, including corporate governance rules and exit arrangements. 2.2 Primary Regulators Antitrust and FDI Regulators There is no single general M&A regulator in Germany. Depending on the industry involved, banking or envi - ronmental authorities may be competent to review the transaction or aspects thereof. In other cases, public licences (eg, in the pharmaceutical sector) need to be renewed due to the change of control in the target company. Aside from these industry-specific cases, many transactions are subject to merger clearance (see 2.4 Antitrust Regulations ), and acquisitions by non-EU/ EFTA investors may be subject to FDI review (see 2.3 Restrictions on Foreign Investments ). In addition, a review under the EU Foreign Subsidy Regulation may apply, where non-EU acquirers of certain (large) EU targets have received significant government subsi - dies. Key Regulator for Public M&A The German Securities Acquisition and Takeover Act ( Wertpapiererwerbs- und Übernahmegesetz ), the Takeover Act Offer Ordinance ( WpÜG Angebotsver - ordnung ) and other statutory ordinances regulate public takeovers of listed companies. Legislation not specific to public takeovers also applies, including the rules of the Market Abuse Regulation, the Secu - rities Trading Act ( Wertpapierhandelsgesetz ) and the Stock Exchange Act ( Börsengesetz ), as well as Stock Exchange Ordinances ( Börsenordnungen ). Compli - ance with these rules of German takeover law is gen -
erally overseen by the Federal Financial Supervisory Authority ( Bundesanstalt für Finanzdienstleistungsauf - sicht , or BaFin). The German Securities Acquisition and Takeover Act governs any public offer ( öffentliches Angebot ) to acquire shares of publicly listed stock corporations, European companies (SEs) and partnerships limited by shares that have their registered seat in Germany and whose shares are traded on the German regulated market (the German Securities Acquisition and Takeo - ver Act does not apply to stock corporations listed only in the open market segment) or, under certain further conditions, that have their registered seat in another European Economic Area member state. There are three classes of public offers: • a (voluntary) takeover offer ( Übernahmeangebot ), aimed at obtaining control of the target (ie, at least 30% of the target’s voting rights) individually or on a joint basis acting in concert with others; • a mandatory offer ( Pflichtangebot ), which must be made if and when 30% of voting rights have been obtained by means other than a takeover offer; and • an acquisition offer ( sonstiges Erwerbsangebot ) not aimed at acquiring control, by buying less than 30% of the target’s voting rights (together with any other target shares attributed to the bidder), buy - ing additional shares if control has already been obtained, or buying non-voting preference shares only. 2.3 Restrictions on Foreign Investments The Foreign Trade Act ( Aussenwirtschaftsgesetz ) and the Foreign Trade Ordinance ( Aussenwirtschafts - verordnung ) provide for the review of foreign direct investments into German companies (be it by way of share or asset deal). First, any non-German investments in domestic com - panies active in the military and defence sector may be prohibited (sector-specific review). Second, under the so-called cross-sectoral review, the Federal Ministry for Economic Affairs and Energy ( Bundesministerium für Wirtschaft und Energie , or BMWE) may review any direct or indirect acquisitions
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