Trump’s Powerful “Golden Share”

July 7th, 2025
Azzy Xiang

In June 2025, a historic and controversial deal was finalized: Japan’s Nippon Steel completed its $14.9 billion acquisition of U.S. Steel, the iconic Pittsburgh-based steelmaker founded in 1901. The transaction—which had been swarmed in politics and national security debates for over 18 months—was only approved after an extraordinary arrangement was reached with the White House. Central to this agreement is the so-called “golden share,” a special governance mechanism that grants President Donald Trump sweeping veto power over key decisions at U.S. Steel.

Details in filings with the US Securities and Exchange Commission reveal that the golden share is not a normal equity stake. Instead, it’s a non-economic share that allows the president to appoint a board member and exercise veto authority over a range of strategic and operational decisions. These include issues related to domestic steel production, job relocations, plant closures and even future acquisitions or sales of the company.

Nippon Steel’s pursuit of U.S. Steel began in December 2023, but quickly became a flashpoint in the 2024 US presidential campaign. Both former President Joe Biden and Trump initially opposed the deal, citing national security concerns and the strategic importance of domestic steel production. This resulted in Biden blocking the transaction in January 2025, only for his decision to be reversed by Trump. Trump permitted the buyout to proceed under strict conditions, with the golden share arrangement as a precondition.

The national security agreement, effective June 13, 2025, requires Nippon Steel to:

Invest approximately $11 billion in U.S. Steel by 2028
Keep U.S. Steel’s headquarters in Pittsburgh
Ensure a majority of the board and key executives are US citizens
Maintain domestic production capacity and jobs
Allow the US government to intervene in decisions affecting national security or economic interests

The Golden Share’s Power

The golden share gives President Trump alone direct and personal veto power over U.S. Steel’s most consequential decisions. According to the revised corporate charter, this authority will transfer to the Treasury and Commerce Departments once a new president takes office, but for now, Trump alone holds the reins.

This arrangement is highly unusual in American corporate management. While golden shares have been used in Europe and other countries to retain government influence over privatized strategic assets, their use in the US, especially with such direct presidential control, is fully unprecedented.

Implications

The golden share is designed to ensure that U.S. Steel remains responsive to the United States’ national security needs, particularly in times of crisis or conflict. It prevents Nippon Steel from moving production or jobs overseas, closing plants or making major strategic changes without US government approval.

Legal experts warn that this level of government intervention could deter future foreign investment in sensitive US industries, as it introduces uncertainty and the potential for political interference. However, some analysts argue that these mechanisms may become more common in deals involving critical infrastructure or defense-related sectors.

The United Steelworkers Union and other labor groups have expressed concern about the concentration of power in the hands of a single political figure, fearing it could complicate labor relations and collective bargaining. This also raises a lot of concern about the future independence of U.S. Steel’s management and board, given the president’s ability to appoint directors and veto decisions.

Extemp Analysis by: Rowan Seipp

AGD: Always punch up not down; with that in mind, making fun of Donald Trump and his ventures may work (obviously dependent on your judge). He has failed enough times for at least one joke.

Background: Explain the drama around the Nippon Steel- US steel merger and why it matters. Also explain what a golden share is.

Question: What is the biggest problem with Trump’s golden share policy?

Answer: Gives too much power to one figure

P1: Trump can appoint directors

P2: Trump can make unilateral decisions

P3: Allows for political favoritism

Obviously, you have to make this extremely clear: why, specifically, in the hands of Donald Trump, is this a problem? Furthermore, you have to A) explain why a golden share allows President Trump to do this and B) why this is controversial/would harm the United States. Happy practicing!