A German law set to pass on Friday will mean investors who hold at least 30% of a distressed group may have to buy out all other shareholders if they want to restructure the business, as the country moves to offer greater protection to domestic companies from investors including private equity firms.

The Risk Limitation Bill, which will come into force this summer, forms part of a campaign by German legislators against large financial investors such as hedge funds and private equity firms, particularly those based overseas, which Franz Müntefering, the then chairman of the Social Democratic Party of Germany, memorably labelled as “locusts” in 2005.