Facts
On 30 September 1998, the Frankfurt stock exchange supervisory authority found unusual orders placed on the shares of IG Farben in Liquidation, which could suggest that the stock exchange price had been manipulated. The Federal Banking Commission was seized by the German Federal Office for the Supervision of Securities Trading (BAWe) to obtain information about the clients of Bank X. in Geneva, which had placed the sell orders.
Bank X. contested the competence of the Federal Banking Commission to request information relating to clients of foreign subsidiaries and stated that the client of X. Bank Cayman opposed the disclosure of their identity. The Federal Banking Commission made a decision on 14 December 1998, ordering Bank X. to communicate the names and addresses of the clients concerned and authorizing the transmission of the information to the HÜST and the competent German criminal authorities.
Bank X. filed an administrative law appeal against this decision, contesting the competence of the Federal Banking Commission and the authorization to transmit the information to the criminal authorities.
Considerations
The Federal Court examined the conditions for international administrative assistance in the supervision of financial markets. It recalled that the Federal Banking Commission may transmit information to foreign supervisory authorities, but that this information may only be used for direct supervision of stock exchanges and securities trading.
The Federal Court also examined the conditions for transmitting information to the criminal authorities. It recalled that the transmission of information to the criminal authorities is prohibited when judicial assistance in criminal matters is excluded. However, the Federal Court considered that the transmission of information to the criminal authorities is possible if the conditions for judicial assistance in criminal matters are met, including the requirement of double criminality provided for in Art. 64 IMAC.
The Federal Court annulled the decision of the Federal Banking Commission insofar as it authorized the transmission of the information collected from Bank X. to the competent German criminal authorities, as the conditions for judicial…