That's my guess if the managing director is exonerated from the following provision:

Bürgerliches Gesetzbuch
>
Buch 1 - Allgemeiner Teil (§§ 1 - 240)

Abschnitt 3 - Rechtsgeschäfte (§§ 104 - 185)

Titel 5 - Vertretung und Vollmacht (§§ 164 - 181)



§ 181
Insichgeschäft
Ein Vertreter kann, soweit nicht ein anderes ihm gestattet ist, im Namen des Vertretenen mit sich im eigenen Namen oder als Vertreter eines Dritten ein Rechtsgeschäft nicht vornehmen, es sei denn, dass das Rechtsgeschäft ausschließlich in der Erfüllung einer Verbindlichkeit besteht.

Or maybe: Prohibition of representational activities on one's own initiative




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Note added at 2003-02-15 05:10:17 (GMT) Post-grading
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I see what you mean about conflict of interest. There are seem to be several ways in which the term could apply to your case according to the following definition (law.dictionary.com):

conflict of interest
n. a situation in which a person has a duty to more than one person or organization, but cannot do justice to the actual or potentially adverse interests of both parties. This includes when an individual\'s personal interests or concerns are inconsistent with the best for a customer, or when a public official\'s personal interests are contrary to his/her loyalty to public business. An attorney, an accountant, a business adviser or realtor cannot represent two parties in a dispute and must avoid even the appearance of conflict. He/she may not join with a client in business without making full disclosure of his/her potential conflicts, he/she must avoid commingling funds with the client, and never, never take a position adverse to the customer.