Employee Ownership Blog

New legislation has been introduced by House members Cass Ballenger (R-NC), Lewis Payne (D-VA), and Dana Rohrabacher (R-CA) to provide that Subchapter S companies could set up ESOPs.

Prospects for employee ownership continue to look promising in China. As we have already reported, several local governments have been privatizing enterprises they own through employee ownership.

We recently reported on a new model for employee ownership developed for Continental AG, one of Germany's largest firms. Now Deutsche Telekom AG, the German telephone monopoly, has come up with yet another approach.

Section 133 of the Internal Revenue Code allows commercial lenders to exclude 50% of the interest income they receive from loans to majority ESOP companies that pass through full voting rights.

The Department of Defense has issued proposed regulations on reimbursement for ESOP defense contractors that could discourage ESOP formation in this industry.

As reported earlier, the Senate eliminated section 133 of the Internal Revenue Code. Section 133 allows lenders to ESOPs that own more than 50% of a company's shares and pass through full voting rights to exclude 50% of the interest income on ESOP loans from taxable earnings.

By a vote of 56-42 the Senate rejected an amendment to the budget reconciliation bill to restore section 133 of the Internal Revenue Code.

A U.S. Court of Appeals has ruled that an ESOP trustee cannot generally be held liable for failing to diversify ESOP holdings out of company stock, even if such diversification would have been a more prudent course of investment. The case (Kuper v. Iovenko, CA 6, No.

Microsoft is famous for making Bill Gates the richest person in America, but the company has made a lot of other people wealthy as well. At an NCEO workshop on broad stock options, Lisa Yeager, Manager of Employee Stock Services for Microsoft, described how the company's ownership plan works.

The Senate Finance Committee approved a Republican proposal to delete section 133 of the Internal Revenue Code.

The Department of Labor seems to have reversed its opinion on pass-through of voting rights in companies that provide "mirror voting and tendering" provisions on unallocated shares.

Senate Finance Committee Republicans have agreed on a proposal to eliminate Section 133 of the Internal Revenue Code.