Volkswagen's biggest shareholder and largest sovereign fund will be suing the German carmaker in a rare legal action for cheating on diesel emission test, and violation of laws.
The lawsuit, which will be filed in the coming week, will be underlining the legal difficulties faced by Volkswagen continuously. With 1.64 % stake in the German automobile maker's ordinary voting shares, the Norwegian fund is the biggest investor, who doesn't own a supervisory seat in Volkswagen's boards.
The state pension fund of Norway, will reportedly join other investors in the lawsuit against the company for failing to provide timely and accurate information to its investors about the emissions test.
"Volkswagen informed the public about the incorrect emissions data after U.S. authorities released a notice of violation letter," the fund said in a statement, according to CNBC. "We have been advised by our lawyers that the company's conduct gives rise to legal claims under German law. As an investor it is our responsibility to safeguard the fund's holding in Volkswagen."
Notably, Volkswagen admitted last year that it has fitted approximately 11 million diesel vehicles globally with software, which could cheat emission test for nitrogen oxide, reported CNN Money. However, the fact was highlighted only after the Environmental Protection Agency of US alerted consumers and law enforcers across the globe.
The Norwegian trust fund, which has invested in the German automaker for several years had a stake worth approximately $1.2 billion at the time of exposure.
The lawsuit was filed after it was discovered that the automobile manufacturer falsified the emission tests by installing software. Once the vehicles hit the road, they would emit 40 times more nitrogen oxide than the allowed level.
Incidentally, this is not the first time Volkswagen has been on the wrong side of the law. Previously Volkswagen was accused of violating the stock market duties by failing to inform the investors about its law-breaking actions.
Volkswagen is presently facing criminal probes by European and US authorities and has reportedly set aside $18 billion to cover the costs of lawsuits.
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