Concept and Legal Basis of the Mining Association under Mining Law
Die mining association under mining law is a special legal form under German and Austrian mining law. It constitutes a company for the exercise of mining activities based on the respective regional legal provisions. Originally, the mining association under mining law evolved from historical German mining law and was particularly refined and shaped by the Prussian General Mining Act of 1865 (ABG) and subsequent regulations.
A mining association under mining law is not a trade union in the modern labor law sense, but rather a special type of company established for the collective operation of a mining business. It features its own organizational structures, liability regimes, as well as special regulations for capital and share management.
Origin and Historical Development
Origins
The roots of the mining association under mining law go back to the Middle Ages, when the union of mining shareholders (owners of shares in a mine) was formed for the collective exploitation of mineral resources. With industrialization and the increasing demand for raw materials, these early associations became progressively formalized.
Legal Foundations
The key legal framework was established especially by the General Mining Act for the Prussian States of 1865 (ABG) and comparable regional legal provisions, for example, in Saxony and Bavaria. After the introduction of Austrian mining laws, the concept of the mining association under mining law was also adopted there.
With the entry into force of the Federal Mining Act (BBergG) in Germany in 1980, the possibility of establishing new mining associations under mining law was eliminated. However, existing associations continue to exist and are subject to transitional provisions.
Legal Structure and Organizational Form
Legal Form
The mining association under mining law is an independent legal entity sui generis. It differs both from the general partnership (OHG) and from the modern stock corporation (AG). Unlike a GmbH or an AG, it is governed by its own mining law provisions, particularly regarding the management of company shares and the liability of members.
Company Organs
The classic mining association under mining law consisted of the following organs:
- General Assembly of Members: Highest decision-making body, where all essential decisions regarding operations and management are made.
- Mine Board: Management body responsible for day-to-day operations as well as representing the association to the outside world.
- Treasurer: Responsible for managing the capital and handling accounts with the shareholders.
Share Certificates and Kuxe
The members’ shares in a mining association under mining law are called Kuxe. Traditionally, these are issued in fractions of the total company assets (e.g., 1/128) and, in economic terms, represent equivalent company shares.
Kuxe were often freely transferable and in part listed on the stock exchange, making the mining association under mining law similar to the stock corporation. However, Kuxe are fundamentally different from shares under the law.
Liability
The liability of the shareholders is regulated by the Mining Act. As a rule, each individual shareholder is only liable up to the amount of their investment; personal obligation to pay additional contributions exists only through corresponding resolutions of the general assembly and according to the statutes.
Purpose, Activities, and Regulations
The mining association under mining law exclusively serves to carry out mining activities within the meaning of mining law. In particular, it may exercise the following rights and duties:
- Acquisition and management of mining (mine) fields and mining property
- Conducting exploration, prospecting, extraction, and processing of mineral resources
- Entering into contracts, acquiring extraction rights, as well as selling quantities of extracted resources
According to the ABG, special regulations applied to mining associations under mining law regarding profit distribution, accounting, disclosure obligations, and the rights and obligations of the shareholders and the management.
Registration, Registration, and Supervision
The establishment of a mining association under mining law was effected via the granting of a concession as well as its formal establishment and registration in the mining register. The association was also subject to state mining supervision. Today, continued existence is possible only for already existing, not dissolved associations.
Continuation, Transformation, and Dissolution
With the entry into force of the Federal Mining Act in 1980, the establishment of new mining associations under mining law in Germany is excluded (§ 151 BBergG). Existing associations (so-called “old Kuxe companies”) continue to exist and are subject to special regulations. Conversion into other company forms, such as a GmbH or limited partnership, is possible under certain conditions. The dissolution of the mining association under mining law occurs essentially through liquidation and deletion from the mining register.
Significance in Current Law
Today, the mining association under mining law has no practical significance for new formations, as the Federal Mining Act excludes this possibility. Existing associations, especially in ore mining in the Ruhr area and parts of Austria, continue to exist and are subject to special legacy regulations. Historically, mining associations under mining law played an immensely important role in the development of mining law and legal forms of mining enterprises.
Summary
The mining association under mining law represents a historically significant and comprehensively regulated legal form in mining law in Germany and Austria. It differs significantly from other corporate forms through the communalization of mining rights and obligations, the specific participation of members via Kuxe, and the special statutory regulations on organization, liability, and administration. While its practical importance has declined with the adoption of the Federal Mining Act, it remains of legal-historical and practical interest due to existing legacy associations and its formative impact on current company and mining law.
Frequently Asked Questions
What prerequisites are required for the establishment of a mining association under mining law?
In order to establish a mining association under mining law, certain legal requirements had to be met under historical German mining law, particularly according to the General Mining Act for the Prussian States of 1865 (ABG). First, a claim had to be filed and a mining field allocated by the competent mining authority. Only then could the co-owners or shareholders form a shareholders’ association in order to be recognized as a legal entity in mining law, the so-called mining association under mining law.
The articles of association had to be set down in writing in the form of a deed or statute and approved by the mining authority. In order to acquire legal personality, entry in the mining register was furthermore required, similar to entry in the commercial register for trading companies. The legal requirements included specifying the number of members, share capital, business purpose, and rules concerning the management and representation of the company.
How is the internal organization of a mining association under mining law regulated?
The internal organization of a mining association under mining law is regulated in great detail under historical German mining law. The association had an assembly of shareholders (similar to a general meeting), which made the most important decisions, especially regarding the administration of the mining field, the sale of Kuxe (shares), or the issuance of special levies (payment obligations). In addition, there was a management organ (also called mine board or administration), which conducted day-to-day business and was elected by the general assembly. The rights and obligations of the shareholders, rules of procedure, voting modalities, and requirements for resolutions were set down in the statutes or mine deed and had to comply with legal requirements, especially regarding majority requirements and responsibilities.
What is the legal significance of the Kux (shareholder’s share)?
The Kux is the central share certificate of the mining association under mining law and is legally interpreted as an ideal fraction of the entirety (the assets) of the association. It is a security of its own kind, certifying the shareholder’s share in profits, losses, and management decisions. The Kux was legally transferable, whereby the transfer and, where applicable, division had to be notarized and entered into the mining authority’s register in order to be effective vis-à-vis the company. Furthermore, ownership of a Kux entailed liability consequences: the holder was obliged to pay special levies corresponding to their share, particularly if the company’s assets were insufficient to cover expenses or liabilities.
How do mining associations under mining law relate to other legal entities?
Mining associations under mining law are a special form of legal entity that differs from companies governed by civil or commercial law. Their formation, organization, and dissolution are regulated solely by (historical) mining law, with their rights and obligations defined largely by statutory special provisions. In particular, mining associations under mining law are neither to be considered general partnerships nor stock corporations as understood by modern corporate law, but they do have their own legal capacity and capacity to be a party and are liable exclusively with the company’s assets and up to the amount of outstanding levies from the shareholders.
To what extent are the members of a mining association under mining law liable for obligations?
According to classical German mining law, the liability of the shareholders is generally limited to the sum of their acquired Kuxe and the related contributions and possible special levies. There is no personal residual liability or further personal liability obligation as is the case with partnerships. This limited liability is a typical feature of the mining association under mining law and was a key reason for its attractiveness as a financing model for mining in the 19th century. The company itself is liable only with the contributed capital and any outstanding levies on Kuxe. Only when these resources are exhausted does no further personal liability of the shareholders apply.
What regulations apply to the dissolution of a mining association under mining law?
The dissolution of a mining association under mining law is subject to certain formal and substantive requirements. It could be effected by a resolution of the general assembly, in some cases also by operation of law (e.g., in the event of exhaustion of the mining field or loss of the rights required for mining operations). The settlement of the company’s assets was governed by the relevant statutes and mining laws and was carried out by an appointed liquidator or the existing management organ. The liquidation had to be notified to the mining authority and supervised both by the police and mining authority. Only after the complete winding-up and deletion from the mining register did the association lose its legal personality.
What role does state supervision play in the legal relationship of mining associations under mining law?
State supervision was a central element for mining associations under mining law. The competent mining authority monitored the establishment, registration, any substantial change to the articles of association, the ongoing management according to statutory provisions as well as compliance with operational and safety requirements. In case of disputes between shareholders and the management, issuance of new Kuxe, or dissolution, the authority intervened in a regulatory and arbitrative manner. This comprehensive supervision primarily served to safeguard public-law interests, in particular the protection of workers, the environment, and the orderly conduct of mining operations.
