Politics

The EU Commissioner for Industry launches proceedings

The EU Commission is increasing pressure on Germany so that its local authorities forbid Daimler to use R143 cooling fluid in its auto climatizing units. R143  has been outlawed almost everywhere and, in theory, is banned in the European Union because of the environmental harm it causes. On January 23 EU Commissioner for Industry Antonio Tajani threatened that the authority would initiate legal proceedings for breach of contract against the federal government if the latter persevered in its inertia. This kind of controversy could appear before the European Court and an unfavourable verdict could prove extremely costly. Commissioner Tajani has made it clear that agreement with the German government is still possible. The Commission is highly critical of the permission that the Federal Motor Transport Authority granted Daimler to carry out modifications to the unit after the car’s homologation. Daimler claims that the alternative fluid  R1234yf produced by Honeywell and Dupont is too easily flammable. Hitherto, the German authorities have been satisfied to accept Daimler’s claim and thus have authorised the production of new models on the basis of the old concession. Daimler now risks having to recall 130,000 vehicles.

Shareholders to vet remuneration plan

Michel  Barnier is working on Bills amending current legislation to be tabled before the upcoming European elections. One in particular, by which the Commission aims to amend shareholders’ rights, will grant European shareholders a more active role in the company they have an interest in. One of the measures the Bill proposes is to submit management remuneration to closer scrutiny by shareholders. In future, the general pay strategy of the company has to be approved every three years at general meetings, as does a report on pay once a year.

If the general pay strategy fails to be approved at the general meeting, the company must immediately  convene an extraordinary meeting and present a new proposal.  The Commission’s aim, to grant more rights to shareholders ,will make the procedure more cumbersome, expensive and time-consuming. The idea make sense when there is a lack of trust in the controlling bodies.