Golden Share

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Golden Share

A share in a publicly-traded company that gives the shareholder power to veto changes to the charter. Golden shares were originated when the British government began privatizing previously nationalized companies in the 1980s and wished to retain a great deal of control over these companies. Other European countries later took similar measures, though many forms of golden share have since been ruled illegal in the European Union.
References in periodicals archive ?
France and Germanyare expected to adopt golden shares as a means to protect their interests.
The Italian Government have a golden share in Telecom Italia.
Last month, the EU internal market commissioner asked the German government to give up their golden share in Eon-Ruhrgas - the company which bid for ScottishPower a year ago.
On Tuesday, the TSE unveiled the proposals, which included recommending punishing any corporate issuer of golden shares by forcibly delisting it.
According to the August 2002 issue of The Dealer's Journal, the UK government held golden shares in 26 companies, including Eurotunnel, National Air Traffic Services and the National Grid.
Golden shares are seen by those who seek greater liberalisation of capital markets as contrary to the spirit of free trade under the rules of the World Trade Organisation.
The Dutch finance ministry would not comment on whether it might invoke its golden share in case of a bid for TNT, which has a market capitalisation of 12 billion euros (pounds 8.
But the government's longstanding position is that it owns the golden share, which among other things allows it to block mergers, to protect its position as a major shareholder and to guarantee postal delivery in the Netherlands until planned laws are in place that can safeguard the public interest.
Golden shares are measures which are often used by governments to block takeovers in newly privatised businesses.
The court said golden shares were a barrier to the free movement of capital and could be justified only in cases of national strategic interest, such as defence, and where the measure was proportionate to the objective pursued.
The court outlawed a Portuguese decree controlling stakes in privatised firms, calling it discriminatory, but said Belgium was entitled to retain golden shares in recently privatised canal operator Societe Nationale de Transport par Canalisations and gas distribution firm Distrigaz.
Taking London to the Luxembourg-based court would be the latest stage in the commission's campaign against government golden shares in former state-owned companies.