Germany

Germany plans to make important step towards securities class remedies

Burkhard Schneider and Markus Pfüller, Clifford Chance Frankfurt

On 7 April 2004, the German Federal Ministry of Justice ( Bundesministerium der Justiz ) announced a project to introduce a novel type of proceeding that aims to facilitate litigation of individual investors concerning false or misleading information to the capital markets (Capital Investors’ Model Proceeding Law - Kapitalanleger-Musterverfahrensgeset ). The Federal Ministry of Justice plans to have the new legislation enacted by 1 January 2005.This legislative project seeks to implement one element of the Catalogue of Measures of the German Federal Government to strengthen the integrity of economic enterprises and to protect shareholders ( Maßnahmenkatalog der Bundesregierung zur Stärkung der Unternehmensintegrität und des Anlegerschutzes ) of February 2003, and to address some of the problems of recent mass securities actions in German courts.