Speeding Up The Courts: Proposed Changes to Securities Litigation

A revision the German Stock Corporation Act (Aktiengesetz) is scheduled for the first half of 2013. Drafts of the Aktienrechtsnovelle were distributed by the Ministry of Justice in late November 2012 to various interest groups for comments. From a litigation perspective, plans are of particular interest to move certain shareholder challenges to AGM resolutions (Spruchverfahren) away from the district courts (Landgerichte) as courts of first instance to the courts of appeals (Oberlandesgerichten) without further rights of appeal (Sec. 11 para. 1 and 2 SpruchG-E).

This would be modelled on the release proceedings (Freigabeverfahren) that begins at the court of appeals level (Sec. 246 a para 1 3rd sen.  AktG; Sec. 16 para. 3 7th UmwG). The draft expressly does not provide for a further right to judicial review (Rechtsbeschwerde, Sec. 574 para. 1 ZPO)  (see Sec. 11 para. 2 Satz 2 SpruchG-E: „Der Beschluss ist unanfechtbar.“), in order to shorten the excessive lengths of the proceedings. While it is true that some of the most appalling excesses in German litigation history occurred in securities cases of that type, I feel uneasy that the only option the Ministry of Justice appears to be think of is to limit rights to appeal and to judicial review – there must be better and more intelligent options than to limit access to justice.

Here is the timetable for the further legislative process: Public hearing in the Judicial Committee (Rechtsausschuss) Lower Chamber of the German Parliament (Bundestag) on February 18, 2013,  March 14, 2013:  2nd and 3rd reading in Bundestag; May 3, 2013: Upper House (Bundesrat).

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