A golden share is a special type of share that provides its holder with certain key powers and typically ensures that the company remains under specific control, such as preventing foreign ownership.
A golden share is a special type of share that provides its holder with the ability to control at least 51% of the voting rights of a company. This share is often retained by governments, especially during the privatization of state-owned enterprises, to ensure that strategic companies do not fall into foreign or other unwanted ownership.
A golden share often gives its holder special voting rights that surpass ordinary shares, ensuring that key decisions require the golden shareholder’s approval. This includes veto power over mergers, takeovers, and significant changes in company policy.
Golden shares have faced legal challenges, especially within the European Union, where they are sometimes seen as obstacles to free market principles. For example, the European Court of Justice has ruled against the use of golden shares in several cases, deeming them incompatible with the Treaty on the Functioning of the European Union (TFEU).
Golden shares play a crucial role in maintaining national security and protecting strategic industries. They are applicable in sectors such as defense, telecommunications, and energy, where governmental control can be deemed necessary for national interests.