The European Commission on Friday revealed that it has formally asked the German Government to amend national rules which discriminate against companies from other Member States which enter into agreements whereby they acquire rights to the transfer of profits or of control from companies based in Germany.
As the situation currently stands, if shareholders in the company transferring the rights exercise their option to sell their shares to the company acquiring the rights, the latter may, if it is a German company, pay in either cash or shares. However, non-German companies must pay in cash.
The EC announced that in its view, this difference in treatment constitutes an infringement of the freedom of establishment as guaranteed by Articles 43 and 48 of the EC Treaty.
The request takes the form of a reasoned opinion, which is the second stage of the infringement procedure laid down in Article 226 of the Treaty.
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