OUTLINE OF THE LEGAL STRUCTURE OF THE GROUP
Volkswagen AG is the parent company of the Volkswagen Group. It develops vehicles and components for the Group, but also produces and sells vehicles, in particular Volkswagen brand passenger cars and commercial vehicles. In its function as parent company, Volkswagen AG holds interests in AUDI AG, Scania AB, SEAT S.A., Volkswagen Financial Services AG and numerous other companies in Germany and abroad. An overview of the significant Group companies can be found in the Notes to the Consolidated Financial Statements in chapter .
Volkswagen AG’s Board of Management is the ultimate body responsible for managing the Group. The Supervisory Board appoints, monitors and advises the Board of Management and is consulted directly on decisions that are of fundamental significance for the Company.
Information on the remuneration structure for the Board of Management and the Supervisory Board can be found in the and in the Notes to the Consolidated Financial Statements of Volkswagen AG in chapter .
ORGANIZATIONAL STRUCTURE OF THE GROUP
Volkswagen AG and the Volkswagen Group are managed by Volkswagen AG’s Board of Management in accordance with the Volkswagen AG Articles of Association and the rules of procedure for Volkswagen AG’s Board of Management issued by the Supervisory Board. Within the framework laid down by law, the Group Board of Management ensures that Group interests are taken into account in decisions relating to the Group’s brands and companies. This body consists of Board members and selected top managers with Group management functions.
Each brand in the Volkswagen Group is managed by a senior brand manager. The Group targets and requirements laid down by the Board of Management of Volkswagen AG or the Group Board of Management must be complied with in accordance with the applicable legal framework. Matters that are of importance to the Group as a whole are submitted to the Group Board of Management in order – to the extent permitted by law – to reach agreement between the parties involved. The rights and obligations of the statutory supervisory bodies of the relevant brand companies remain unaffected.
The companies of the Volkswagen Group are managed separately by their respective managements. In addition to the interests of their own companies, each individual company management takes into account the interests of the Group and of individual brands in accordance with the framework laid down by law.
MATERIAL CHANGES IN EQUITY INVESTMENTS
The acquisition of the Scania shares previously held by Investor AB and the Wallenberg foundations was completed on July 22, 2008. This increased Volkswagen AG’s voting rights in Scania from 37.98% to 68.60% and its equity interest from 20.89% to 37.73%. This equity interest is designed to safeguard the Group’s strategic interest in the commercial vehicles business. In addition, additional shares of Scania, held in trust by a credit institution, with voting rights amounting to 0.87% and an equity interest of 3.63% are attributable to Volkswagen.
Effective December 1, 2008, Volkswagen AG acquired from Porsche Automobil Holding SE the shares of AUDI AG (0.41%) that had been tendered to the latter under the terms of a mandatory bid, thereby increasing Volkswagen AG’s interest in AUDI AG to 99.55%.
On December 15, 2008, Volkswagen AG announced the sale of Volkswagen Caminhões e Ônibus Indústria e Comércio de Veículos Comerciais Ltda. (VW CO), Resende, Brazil, to MAN AG, Munich, effective January 1, 2009 at an enterprise value of €1.175 billion. This concentrates the Volkswagen Group’s commitment to the truck business on its existing equity interests in MAN and Scania along with its own light commercial vehicles business, which remains unaffected by the transaction. Volkswagen expects the sale to be completed in the first quarter of 2009.
LEGAL FACTORS INFLUENCING BUSINESS
Volkswagen companies are affected – as are other international companies – by numerous laws in Germany and abroad. In particular, there are legal requirements relating to development, production and distribution, but that also include tax, company, commercial and capital market law, as well as labor, banking, state aid and insurance regulations.