| For 47 years, Germany has protected Europe's | | | | considerable influence on the automaker. The state of |
| largest automaker Volkswagen from any hostile | | | | Lower Saxony is the automaker's second biggest |
| takeovers. A German law forbids any firm or individual | | | | shareholder and it is considered to be the arm of the |
| from acquiring more than 20 percent of Volkswagen's | | | | government operating within the ranks of the listed |
| shares. That law though which has stood for almost | | | | company. |
| half a century is now gone as the European Union | | | | "This situation is liable to deter direct investors from |
| Court of Justice decided that the legislation should be | | | | other member states," said the court in a statement. |
| abolished. | | | | Investors are limited to only twenty percent of voting |
| The scrapping of the law though is not as severe as it | | | | rights even if they own more than 20 percent of the |
| would have been if the leading firm looking to acquire | | | | shares of Volkswagen, known for the Beetle and |
| Volkswagen is not a German company. It has been | | | | reliable auto parts such as the VW headlight switch, |
| the responsibility of the "Volkswagen law" to keep its | | | | side mirrors, transmission and engines. |
| control in Germany. Today that the law is no longer | | | | Porsche has been buying shares of Volkswagen and |
| valid, Germany is not in danger of losing Volkswagen | | | | now owns 31 percent. Now that the Volkswagen law |
| to a far Eastern competitor or a private equity fund as | | | | is no longer in place, Porsche can either buy more |
| Porsche, a German automaker is setting its sight on | | | | shares of Volkswagen to take control of the |
| taking control of the giant automaker. | | | | automaker or wait for the company's annual meeting |
| The decision of the European Union Court of Justice | | | | where they can be given total control of Volkswagen. |
| though sent a clear message to all its member | | | | Porsche has ambitious plans for Volkswagen and it |
| countries. And that is the EU will not be allowing | | | | can be achieved once it takes control of the company |
| national protectionism get in the way of free | | | | 14 times bigger. |
| movement of capital. Volkswagen is symbolic to | | | | It is reported that Porsche is looking to make |
| Germany since it has risen from the ashes of the | | | | Volkswagen a strong rival of Toyota in terms of |
| Second World War and gave the European country | | | | productivity and profitability. Porsche has been known |
| new pride. The European Union made it clear that | | | | to be a highly profitable automaker with its lineup of |
| there will be no scared cows. | | | | upscale vehicles. With the automaker's involvement in |
| The EU Court of Justice ruled that the Volkswagen | | | | the development of new vehicles for Volkswagen, the |
| law is discouraging foreign investors to take a stake in | | | | auto industry can only wait what this development will |
| Volkswagen as German authorities are exercising | | | | bring to Volkswagen. |