Share transfer after final release

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Judgment of the OLG Frankfurt from December 15, 2023 – Case No. 17 U 66/22

If a final release decision for the transfer of shares under the Foreign Trade Act exists, the legality and effectiveness of the release are not to be reviewed by a court in civil proceedings. This was decided by the OLG Frankfurt in its judgment of December 15, 2023 (Case No.: 17 U 66/22).

Errors often occur in the transfer of shares. Such errors can have serious consequences leading to the invalidity of the transfer, according to the commercial law firm MTR Legal Attorneys at Law, which advises among other areas in capital market law and stock law. Merely signing the purchase agreement usually does not suffice for the ownership of the shares to pass to the buyer. The shares must also be transferred to the buyer through endorsement or assignment.

The OLG Frankfurt has now decided that when the parties agree on the transfer of shares for which the Federal Ministry of Economics has issued a final release decision under the Foreign Trade Act, the legality and effectiveness of the release decision are not to be reviewed in civil proceedings. With the judgment, the defendant shareholder was obligated to consent to the transfer of approximately 14 million shares of a stock corporation (AG).

Loan repayment through share transfer

The initial situation was the dispute between the parties about the transfer of additional shares of the stock corporation. The defendant had been the majority shareholder of the approximately 27.6 million shares of the AG. The plaintiff, based in Luxembourg, held a minority interest. She had granted the defendant several loans. The repayment of the loans was to be made by transferring additional shares to the plaintiff if the parties could not agree on a cash payment.

Furthermore, the loan agreement stipulated that the plaintiff could demand early repayment of the loans. The condition for this was that she informs the defendant at least 90 days before the intended transfer of the shares. To secure the loans, the defendant had pledged about 15 million shares to the plaintiff.

In the legal dispute, the plaintiff claimed that she had timely demanded and pronounced the early repayment of the loan. Therefore, she sought a declaration that – as contractually agreed – the approximately 15 million pledged shares had been transferred to her. Alternatively, she applied for the defendant to be condemned to transfer the shares.

Claim for consent to share transfer

The dispute initially went to the Regional Court Frankfurt, which decided with a judgment of February 25, 2022, that about 13 million shares had been transferred (Case No. 2-02 O 213/21). Both parties appealed against the judgment.

The OLG Frankfurt modified the first-instance judgment. It clarified that the shares had not yet been effectively transferred to the plaintiff. However, the plaintiff was entitled to demand that the defendant consents to the transfer of about 14 million out of the total of approximately 15 million shares.

The judges in Frankfurt reasoned that the property transfer of the shares had not yet occurred because the concerned shares had not yet been sufficiently determined. However, it is to be assumed that concerning about 13 million shares, the parties have reached an effective partial settlement, and the defendant has committed herself therein to the transfer of the shares, according to the OLG. The required release under the Foreign Trade Act had been granted. Reviewing the release order for its effectiveness and legality is not necessary, the court made clear.

Regarding the transfer of almost another million shares, the plaintiff could not demand the defendant’s consent. Here, the defendant had opted for the possibility of cash payment, according to the OLG Frankfurt. The judgment is not yet legally binding.


The effective transfer of shares can be complex. MTR Legal Attorneys at Law are at your disposal for this and further questions of capital market law as competent contacts.

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