Participation certificate

Security that embodies property rights, but not membership rights, in a stock corporation. Participation certificates are used primarily in Switzerland as a financing instrument and are similar to the German Genussschein. Due to the lack of voting rights in these securities, companies can protect themselves against foreign infiltration (superalienation) and still raise risk-bearing capital, since it may participate in losses. On the part of the investors, however, no legal regulations are envisaged which would enable them to exert a controlling influence on the business policy of the company. In this respect, the participation certificate, like the German Genussschein, is in a certain sense ultimately a means of circumventing mandatory stock corporation law. – Sometimes also used to refer to an index certificate.

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
E-mail address: info@ekrah.com
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