Series Title | European Voice |
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Series Details | Vol.9, No.13, 3.4.03, p17 |
Publication Date | 03/04/2003 |
Content Type | News |
Date: 03/04/03 A DEAL on a key part of the politically charged EU takeovers directive could wipe out the equivalent of Denmark's entire €22.5 billion budget surplus if it goes ahead, one of its MEPs has warned. Christian Rovsing, leader of his country's group of centre-right deputies, said that could be the cost of compensating all the owners of special categories of shares, which could soon be outlawed. 'It's going to be a huge, huge sum. A rough guess would be that it would equate to the [€22.5 billion] surplus of the Danish state budget,' he added. Under proposals on the draft law backed by the UK, France and Germany - as well as German Christian Democrat rapporteur Klaus-Heiner Lehne, the special shares, common in all Nordic countries, would be outlawed in 2010. They claim the so-called 'A' shares create a barrier to takeover bids - one of the obstacles the directive is meant to remove. That is because their owners enjoy many times more voting rights in shareholder meetings than holders of ordinary shares. But Rovsing said the cost of abolishing preferential shares would be crippling to countries like Denmark, besides attacking a tried and tested system of corporate control which has helped companies such as brewing giant Carlsberg, transport company AP Moller and drugs firm Novo-Nordisk take on the world. 'First people would have to sue the Danish government, because they take away rights that they have paid for, requiring compensation under the Danish constitution. 'The government will then have to sue the European Union to get back the money it paid because the EU enacted the directive. It is most unpleasant - no one likes it.' He favours the position of British Liberal Chris Huhne, a member of the Parliament's economic and monetary affairs committee. Huhne, who is also issuing a report on the issue, says existing special voting rights should be set in stone or 'grandfathered', with only a ban on new issuance of special categories of share. 'This is something we could live with,' Rovsing said. Nordic MEPs, including Finland's Pia Noora-Kauppi, Sweden's Charlotte Cederschild and Denmark's Helle Thorning Schmidt share his concerns, he added. A deal on a key part of the politically charged EU takeovers directive could wipe out the equivalent of Denmark's entire €22.5 billion budget surplus if it goes ahead, one of its MEPs has warned. |
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Subject Categories | Law |
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