FREE MOVEMENT OF CAPITAL : COURT HEARING ON VOLKSWAGEN LAW'.
The Volkswagen law' is being re-examined by the EU Court of Justice, which on 12 March held a hearing of the submissions of the parties - the European Commission and Germany. The Commission brought a second action against Berlin in late 2011 on certain points of this text, which it sees as infringing the principle of free movement of capital, and requested financial penalties (Case C-95/12, see Europolitics 4313).
The dispute over this law, which establishes an exception in rules governing capital companies in Germany, has been going on for a decade. It maintains provisions that give special rights to German public authorities (of Lower Saxony and potentially the federal government), through golden shares, in Volkswagen's management. These were ruled incompatible by the EU court in 2007 (Case C-112/05).
These rights consisted of the authorities' mandatory representation in Volkswagen's Board of Directors, a 20% blocking minority (whereas German law sets the rate of...
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