What was hinted at in the key points paper on the Future Financing Act is now given substance in the draft bill that is now available. In Germany, it is intended to make possible the issuance of crypto shares in the future. To this end, the German Stock Corporation Act (AktG) and the Electronic Securities Act (eWpG) are to be amended. While the eWpG has so far only been applicable to bearer bonds, it should also be possible to issue shares in the form of an electronic security in the future. Electronic securities operate purely digitally, so that the traditionally required securities certificate is not required for the issuance. Instead, registration in an electronic securities registry is required. Electronic securities registers are, on the one hand, central registers maintained by a securities clearing and deposit bank or a custodian holding a license to operate the custody business. Alternatively, electronic securities registers may be crypto securities registers. The draft bill on the Future Financing Act now provides that registered shares may in future be entered both in a central register (so-called central register shares) or in a crypto securities register (so-called crypto shares). Bearer shares, on the other hand, are to be able to be issued only as central register shares and not as crypto shares. The crypto share will therefore always be a registered share in the future.
Requirements for the Issuance of Crypto Shares Must be Set in the Articles of Incorporation
The amendments to the AktG provided for in the draft bill do not change the fundamental structure between registered and bearer shares. It remains legally stipulated that shares are in principle registered shares. Only under certain circumstances can newly established stock corporations opt for bearer shares. According to the draft bill, this should be possible, among other things, if securitization of the shares is excluded and the share is entered in a central register, i.e. is issued as a central register share. For the issuance of crypto shares, the articles of association must authorize the issuance of registered shares as electronic shares to be entered in a crypto securities register. Accompanying this, the possibility of securitization of the shares must be excluded in the articles of association. There is no signature requirement for electronic shares, not even electronically. In the case of registered shares, the stock corporation must keep a share register in which information on the shareholders must be entered so that the current shareholders can be identified at any time. In this respect, the shareholder is legally obliged to provide the company with the information provided for in the AktG. To ensure that shareholders can also provide the company with the necessary information in the case of electronic shares, the draft bill provides for a joint obligation on the part of the company and the body keeping the register to set up a reporting system.
Equal Treatment of Crypto Shares and Securitized Shares in Principle
The new electronic shares will not constitute a separate type of share. According to the fiction of the eWpG, electronic shares shall have the same legal effects as securities issued by means of a certificate. Furthermore, electronic securities are to be regarded as objects within the meaning of the German Civil Code (BGB). If electronic shares are to be offered to the public or listed on a regulated market, a securities prospectus will generally have to be prepared for this purpose. In the case of a small-volume public offering of electronic shares up to EUR 8,000,000 in Germany, a securities information document (WIB) may be prepared instead of a securities prospectus. A difference to traditional certificated shares may arise from the fact that electronic shares could be traded on different markets or platforms than securitized shares. For trading in electronic shares listed on a regulated market or on a multilateral or organized trading facility, obligations may also arise from the Market Abuse Regulation.
Dr. Konrad Uhink