Sarbanes-Oxley forces Porsche to reverse
German luxury carmaker Porsche says the Sarbanes-Oxley Act was the decisive factor in its decision to abandon a listing on the New York Stock Exchange.
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The move appeared to be the first apparent case of the Act’s extra-territorial powers scaring off a foreign company.
Porsche had been invited to join the NYSE at the beginning of 2002, but in a statement made today, the company, which is already listed on German stock exchanges, said: ‘The crucial factor in Porsche’s decision was ultimately the law passed by the U.S. government this summer (the “Sarbanes-Oxley Act”).’
Porsche took issue with the new requirements for CEOs and finance directors to ‘swear that every balance sheet is correct and, in the case of incorrect specifications, are personally liable for high financial penalties and even up to 20 years in prison’.
The company also claims the listing would not bring the company any benefits, and instead and would have resulted in ‘considerable extra costs’.
Finance director Holger P. Harter said, in Germany, the deliberate falsification of balance sheets was ‘already punished according to the relevant regulations in the Commercial Code and the Company Act’.
He added that any special treatment under Sarbanes-Oxley was both ‘illogical’ and ‘irreconcilable’ with current German law.