Vom Schutzrecht zum schützenden Organisationsrecht


The article investigates the formation of groups from the perspective of directors’ fiduciary duties. The influence of the controlling company creates a conflict of interest for the directors of the subsidiary. This would normally preclude directors from invoking the business judgment rule. If the law is to enable the formation of groups, it must abstract from the conflict of interest. German company law does so through § 311(1), (2) Stock Corporation Act, rather than § 317(2) Stock Corporation Act. The business judgment rule applies as long as the subsidiary is fully compensated for the cost of accomodating the parent’s interest. The law thus mandates a fair division of value in intra-group transactions between the subsidiary and other group entities, subject to full review by the courts. This requirement eliminates conflicts of interest on the part of the parent, thereby eliminating the need for a substantive review of business decisions made on behalf of the group.

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