Tue, Sep. 05, 2006

Bad Luck for Investors

TS - Washington.   Since 2004, the prosecutors of Bavaria, the largest state of Germany, have closed several criminal investigations of investment fraud on the basis of the statute of limitations contained within the Bavarian press statute, Art. 14 Bayerisches Pressegesetz, BayPrG.

German prosecutors usually apply the five-year statute of limitations in § 264a of the German criminal code, Strafgesetzbuch. Art. 14 BayPrG provides for a six-months statute of limitations for offenses committed by means of printed works, such as an investment prospectus, without exceptions. The press statutes in other German states exclude all kinds of commercial advertising material from the six-month-term. Munich attorney Ralph Veil calls it a competitive advantage in Bavaria for crooks.

As Börse Online reported in August 2006, the application of Art. 14 BayPrG is highly controversial. Hardly anybody knows why Bavarian prosecutors believe that the state law should trump the federal statute. Now, the Bavarian Attorney General plans to instruct the Bavarian prosecutors to apply the five-year statute of limitations. It also plans to refer a suitable case to the federal criminal supreme court, Bundesgerichtshof, to decide the supremacy issue.

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