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Germany aims to protect tech firms from foreign takeovers

Germany's economy ministry on Thursday said it planned to tighten rules on non-EU takeovers of hi-tech firms, against a backdrop of growing alarm about Chinese firms buying up German know-how.

Published: 28 November 2019 13:15 CET
Germany aims to protect tech firms from foreign takeovers
Kuka robots on display at the Hannover Messe, an international technology fair, in April. Photo: DPA

The ministry said it had drafted an amendment to the Foreign Trade Regulation that would allow the government to review or block foreign purchases of stakes as low as 10 percent in “critical technology” companies.

It would affect firms working in the areas of robotics, artificial intelligence, semi-conductors, biotechnology and quantum technology.

“It's not about banning acquisitions, but about being able to look at them more closely in cases where it concerns critical technologies,” the ministry said in a statement.

READ ALSO: Germany to tighten rules on foreign takeovers: report

The move goes further than previous efforts by Berlin to protect strategic firms from foreign acquisitions.

Economy Minister Peter Altmaier will unveil the proposal at a Berlin press conference on Friday.

Concern has mounted in recent years as Chinese companies have bought up or
purchased controlling stakes in high-tech firms, airports and harbours in countries across the European Union.

In Germany, the 2016 takeover of industrial robotics Kuka by Chinese household goods maker Midea sparked an outcry with critics saying vital technologies were being sold off to Beijing.

The German government responded in 2017 by announcing closer scrutiny of acquisitions by non-EU firms, doubling to four months the time for reviews, and strengthening its veto powers.

Berlin toughened its stance again last December with stricter rules to shield “critical infrastructure” sectors like energy, defence and telecoms from such takeovers.

Those regulations made it possible for the government to review purchases of stakes as low as 10 percent in such companies, down from 25 percent previously.

But it still did not cover companies like Kuka — something Altmaier's latest proposal seeks to address.

During a visit to Berlin in July 2018, Chinese Prime Minister Li Keqiang sought to reassure anxious Germans.

Investments from China “do not threaten your national security”, he said, stressing that Chinese firms wanted to learn from German “experiences and technologies”.

That same month, the German government took a minority stake in electricity
transmission firm 50Hertz, thwarting Chinese investors from buying into the
company.

READ ALSO: How Germany plans to zoom out of the digital slow lane (and why it could struggle)

A Kuka device is sold at a “Reused Goods Fair” in Karlsruhe. Photo: DPA

'Unequal fight'

In another case last year, Berlin came close to using its veto right for the first time to halt the sale of machine tool manufacturer Leifeld Metal Spinning to China's Yantai Taihai Corporation.

Yantai preemptively abandoned its bid, avoiding the need for a veto.

Germany is far from alone in trying to curb Chinese appetite for European firms.

Sweden's Volvo Cars, Italian tyre-maker Pirelli and the French holiday group Club Med have all passed into Chinese hands this decade.

From just €2.1 billion in 2010, Chinese direct investment into the European Union hit a peak of €37.2 billion in 2016, according to a study by the Rhodium research group.

The volume of Chinese investments has dropped since, as Beijing clamped down on overindebted firms and European governments scrambled to tighten regulations.

Much of the Chinese investment has come from state-controlled groups, the study found.

Economy Minister Altmaier said German companies were increasingly competing
against rivals who benefitted from state intervention and protectionist policies.

“This is an unequal fight that our firms are losing more and more,” he told DPA news agency.

Altmaier's latest push to curb China's buying spree comes as the German government faces pressure to exclude Chinese tech giant Huawei from developing the country's next-generation 5G mobile network.

READ ALSO: Auction for superfast 5G launches in Germany

Critics, led by Washington, say Huawei has close ties to the Chinese government and its equipment could be used to spy for Beijing.

Huawei has strongly denied the allegations.

Merkel has so far resisted the calls to ban Huawei from the bidding process, saying those involved in the 5G rollout would have to comply with stringent security standards.

But opponents accuse her government of bowing to the economic might of China, Germany's largest trading partner.

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WORKING IN GERMANY

Which Bavaria-based companies regularly hire English speakers?

Bavaria is no doubt a beautiful state with a strong economy, but can be a hard place for non-German speakers to integrate. The Local takes a look at job opportunities in Germany’s southeastern 'Free State.'

Published: 7 February 2024 10:54 CET
Updated: 10 February 2024 08:20 CET
Which Bavaria-based companies regularly hire English speakers?

Munich ranks third in German cities with the highest total GDP, behind Berlin and Hamburg, but in terms of GDP per capita, it’s higher than both of them.

It also consistently ranks high, often highest, in terms of average household income.

As of 2023, nine of the 40 companies listed on DAX, Germany’s stock index, were based in Bavaria. Seven of those are based specifically in Munich.

While Frankfurt is commonly known to be Germany’s business capital, Munich can claim the title of Germany’s insurance capital, which is saying something, as Germany is home to some of the largest insurance firms in the world, like Allianz.

Beyond the state’s capital city, a number of international companies are based elsewhere in Bavaria, particularly in the Franken region, near Nuremberg.

Which companies actively hire English speakers?

Bavaria, and Munich in particular, is home to a number of companies at the forefront of international business. But the state is known for its traditional, sometimes conservative, culture, which affects its business culture as well.

Whereas companies embracing English as their primary business language are easy to find in Berlin, the practice is less common in the south. That said, there are some notable exceptions. 

Sportswear giants, Adidas and Puma, both have their headquarters near Nuremberg in Herzogenaurach, and regularly recruit English speaking international talent.

“As an international company, our teams reflect the rich diversity of our consumers and communities,” Jon Greenhalgh, Senior Manager Media Relations for Adidas told The Local. “Fostering a culture of inclusion where we value and leverage differences, ensures that we can authentically engage with our employees and truly connect with our consumers.”

He added that around 40 per cent of Adidas’ Germany-based employees are foreign nationals, from over 100 different countries.

Siemens and BMW rank among Bavaria’s top employers, and are also known to hire their fair share of foreigners.

“In Germany, we recently had around 2,000 open positions,” Konstanze Somborn told The Local on behalf of Siemens AG.

He added that Siemens operates in 190 countries. “That is why we value international teams very much…English as a common language is very usual.”

READ ALSO: ‘Which German companies want to hire foreigners?’

Similarly, BMW hires workers from a variety of backgrounds. 

“Every year, we hire lots of internationals and welcome them to the BMW Group,” Dr. Hans-Peter Ketterl, a press spokesman for BMW Group told The Local. 

But not all of these positions are available to non-German speakers.

Ketterl added that BMW’s working language is German in the country, even though, “English is an indispensable entry requirement as the second corporate language in many areas of the company.”

Check job boards and follow best practices

If it’s your first time applying for jobs in Germany, make sure to change your resume to the German format, even for English positions.

While Germany is home to its own job boards, like Xing, LinkedIn is probably the best place to start. In addition to searching for positions based in your preferred location, you can check relevant groups, like Munich Startups, to broaden your horizons.

The English Jobs in Germany website is also a good resource to start with. 

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