German corporate law.

It appears that German corporate law requires that, unless a corporation's by-laws provide otherwise, certain decisions can only be made if they are opposed by fewer than 25% of the proxy shares voted. This makes the figure 25% the "blocking minority."

Volkswagen has written into its own bylaws a still more generous provision for dissenters. It has a blocking minority of only 20%.

Twenty percent is also the share of the equity of VW owned by the government of Lower Saxony, VW's home state.

That not only gives Lower Saxony blocking power, but it makes that state the second largest of the company's shareholders. The largest shareholder is thw sports car maker, Porsche.

A ruling last year by the European Court of Justice has pressured VW toward making some corporate governance changes, fitting in more coherently with the rest of the EU. Porsche understands the ECJ to mean that VW should increase the blocking percentage. This wouldn't mean a shift to simple majority rule. It would probably be an increase to the German default option of 25% block. But even so, it would mean that in order to prevent some change that it didn't like, Lower Saxony would have to find shareholder allies.

This would be, if you will, a sort of deregulation.

Unsurprisingly, Lower Saxony doesn't see the ECJ ruling the same way Porsche does.

My sympathies are always against the government. Go, Porsche!

The punchline of an old joke says it best. "It's not a porch, it's a Mercedes."