[The following guest post is contributed by Sarthak Raizada and Kartikey Kulshreshtha, who are 4th year students at Dr. Ram Manohar Lohiya National Law University, Lucknow.] Introduction The Competition Act, 2002 (the “Act”), while still in the early stages of its development in India, has witnessed immense litigation. The Competition Commission of India (“CCI”) has adjudicated and delivered...
Contract Depriving a Party of Interest: Immorality and Public Policy
[The following guest post is contributed by Amitav Singh, a fourth-year student at the National University of Advanced Legal Studies (NUALS), Kochi] In a recent decision in Union of India v. M/s NK Garg & Co. (“NK Garg”), decided on 2 November, 2015, a single judge of the Delhi High Court (“Court”) held that any agreement by which a party is deprived of interest would be void on the ground...
Whether Collection of Margin on Derivative Trades is Mandatory?
[This post is contributed by Prachi Pandya, founding proprietress of Corporate Attorneys and Vanessa Fernandes, an intern at Corporate Attorneys] Despite being termed as a weapon of mass destruction by Warren Buffet, derivatives are still an integral part of stock market trading. Whilst purchasing equity, one has to pay the entire value of the shares purchased within the settlement period of two...
Problems with the RBI’s new ECB framework
[This guest post is by Pratik Datta and Shefali Malhotra, who are Consultants at the National Institute of Public Finance and Policy (NIPFP). They can be reached at [email protected] and [email protected] respectively.] Introduction This blog had earlier explained the policy backdrop leading up to the Reserve Bank of India’s (RBI’s) draft framework for External...
The Proper Purpose Rule
Eclairs Group v. JKX Oil [2015] UKSC 71 is an important illustration of the power of the Courts to interfere in decisions taken by the Board of a company (even when those decisions are taken in good faith by the Directors). JKX Oil [“JKX”] is a company listed on the London Stock Exchange. Eclairs and Glengary, both incorporated in the British Virgin Islands, owned substantial minority...
Papers on Takeover Regulation
I have posted two papers on SSRN, the titles and abstracts of which are as follows: 1. “Comparative Takeover Regulation and the Concept of ‘Control’” The mandatory bid rule (MBR), one of the basic tenets of takeover regulation, obligates an acquirer who obtains ‘control’ over a target company to make an offer to acquire the shares of the...
Supreme Court on Takeover Offer Price
Under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations (both under the current version of 2011 and previous version of 1997), takeover offers are required to be made at a minimum offer price that is based on the historical market price over a specified period of time and also on other acquisitions made by the acquirer of persons acting in concert (PACs) during a similar...
Voting Rights on Preference Shares: An Unclear Provision?
[The following guest post is contributed by Vignesh Iyer of Vinod Kothari & Co. The author can be contacted at [email protected]] The enactment of the Companies Act, 2013 (Act, 2013) has given rise to various issues with regard to compliance and interpretations of several statutory provisions. One such issue is the subject matter of this post. Section 47 of Act, 2013 – Voting...
SEBI Adjudication Order: Disclosure of Encumbrances Over Shares
The SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (the “SAST Regulations”) contains provisions in Reg. 31 that requires promoters of a company to disclose to the company and the stock exchanges the details of shares encumbered by them and also any invocation or release of encumbrance. The genesis of the requirement to disclose pledge and other encumbrances arose after...
Disclosures under Non-Disclosure Agreements?
[The following guest post is contributed by Yogesh Chande and Malek-ul-Ashtar Shipchandler of Shardul Amarchand Mangaldas. Views expressed herein are personal and solely that of the authors.] A recent post titled “Confidentiality Agreements in M&A Transactions” (available here) discussed confidentiality agreements in the context of a US based M&A transaction. From a view point of insider...
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