13 - Evidence of convergence?

Summary

The analysis of German and Austrian law contained in this book has focused on bearer securities since almost all German companies issue them. This, however, has changed in recent years. A few large German listed companies have replaced bearer with name shares, a change caused by globalisation. The reason for the change was that the companies concerned wanted to be able to list directly on the New York Stock Exchange (NYSE). The NYSE, however, lists only name shares. In order to be able to issue the same type of share to investors in the US and to German investors, the German issuers decided to issue name instead of bearer shares on both the American and the German stock market. The German legislature supported this changeover by reforming the law of name shares which is traditionally contained in the German Joint Stock Companies Act (Aktiengesetz).

This Act requires German companies which issue name shares to maintain a register of shareholders. At the same time, the law relating to this register was also updated. Interestingly, the changes that were effected included a change in German legal terminology. Before the reform, the share register was referred to as a ‘share book’ (Aktienbuch). That term was abandoned in the course of the reform and replaced by the term ‘share register’ (Aktienregister).