Corporate takeovers: the government wants to protect German companies against foreigners

The Federal government has agreed on stricter rules for the acquisition of shares in German companies by foreign investors. Thus, in safety-relevant areas is to be lowered the threshold at which the Federal government may consider a share acquisition by an Investor outside the European Union, from 25 percent to 10 percent, reported the “Handelsblatt”.

the corresponding draft of The amendment to the foreign trade and payments regulation (AWV) is to be decided at a Cabinet meeting, according to the report in the newspaper this Wednesday. In the economy Ministry said on Sunday on request, it is true that the foreign trade and payments Ordinance amendment “is soon to be in the Cabinet”. Further details have not been made.

Only in safety-relevant areas

The lowered threshold of 10 per cent applies only to safety-relevant areas, such as the range of the defense or the so-called critical infrastructures. This includes energy utilities. The threshold would be sharper than the Minister of economic Affairs, Peter Altmaier (CDU) favoured. He had sought 15 percent.

the Background of the plans from companies are being taken over by Chinese investors. So, the Federal government had prevented the entry of a Chinese company in the German power supply. Therefore, the rules for takeover attempts in sensitive areas tightened. The goal is that the Federal government can have a say in time, if the legitimate security interests of Germany could be affected.

Alliance chief calls for clearer rules

Alliance chief Oliver Bäte should be happy about the plans. He started on Sunday for clearer rules for foreign investors in Germany. “Free trade carries with it many risks,” he said in an Interview with the “Welt am Sonntag”: “We need an industrial strategy.” It is naive to believe that the free forces of the market solved all problems.

“I wouldn’t blame the Chinese, they like to buy high-technology,” said Bäte. “Rather, we must think of ourselves as a society in Germany and also in Europe: In what areas we would like to complete free trade and competition and in what areas?” You should basically think about which sectors are in terms of technology, employment, and other topics of strategic importance and with the trading partners to discuss: “whether Chinese or American partners, are important, clear rules that don’t change.”