GERMAN market regulator BaFin is reviewing whether to impose fines after it found that transactions to buy a 9.69 percent stake in Daimler on behalf of Li Shufu, chairman of Chinese carmaker Geely, should have been disclosed earlier.

Li disclosed Feb. 23 that he had amassed a US$9 billion investment in the German carmaker using banks, shell companies and derivatives, prompting questions in Berlin political circles about the adequacy of German disclosure rules.

Li, who controls carmaker Volvo, revealed that he had control over almost 10 percent in rival Daimler, parent company of luxury brand Mercedes-Benz, even though German rules require investors to reveal if their stake exceeds the 3 percent, 5 percent and 10 percent thresholds.

“Voting rights disclosures by Shufu to Daimler should have been reported Feb. 22,” BaFin said in a statement Saturday. The regulatory disclosures have since been amended to reflect the earlier date of Feb. 22 rather than Feb. 23, BaFin said.

“Whether this could also be relevant in regard to fines is something we are looking at,” BaFin said, adding that the maximum fine to be paid by private individuals who violate disclosure rules could be two million euros (US$2.39 million), and for companies 10 million euros, or 5 percent of annual revenue.

As part of the Geely deal, German regulator BaFin asked Morgan Stanley to correct a disclosure filing, according to letter from Germany’s finance ministry. Germany’s finance ministry, which oversees BaFin, declined to comment on this specific case.

Investment bank Morgan Stanley, which held Daimler voting rights that would later pass on to Li, has amended its disclosure filing to reflect the new date, the letter said.

(SD-Agencies)