Blog Posts
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Derivative Actions – Part I
The issue of shareholders making claims on behalf of a corporation has been a bone of contention ever since the decision in Foss v. Harbottle. However, in recent times, two particular aspects of this controversial area of corporate jurisprudence have received significant attention. These are the issues of multiple derivative claims, and the statutory requirements…
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Insider Trading: Where Do We Draw the Line?
In an interesting two-part column series in the Mint (here and here), Govind Sankaranarayanan considers the broad academic debate surrounding insider trading. He makes at least two pertinent observations: (i) the line between insider trading that is considered acceptable and that which is improper is quite often blurred and difficult for regulators to segregate; and…
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Restructuring Companies: Capital Gains and Transfer Pricing
In a very interesting decision that could have significant implications for restructuring companies, the Authority for Advance Rulings [“AAR”] has discussed several controversies in connection with restructuring schemes. The decision, Re Dana Corporation (decided November 30, 2009), is available here. The applicant, Dana Corporation, was incorporated in the USA. As part of its extensive worldwide…
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The Debate over Multiple Classes of Shares
Currently, the issue of shares with differential rights as to voting and dividend is in a state of flux. While the Companies Act, 1956 and the Rules issued pursuant to that allow shares with differential rights, SEBI has proscribed the issue of shares with “superior voting rights” in listed companies, implicitly allowing shares with “inferior”…
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Task Force on Governance Reforms
A few days ago, the website of the Ministry of Finance carried a draft report consisting of recommendations by a Task Force appointed by the Confederation of Indian Industry (CII) to reform corporate governance norms in India. This Task Force was appointed in the wake of the Satyam scandal earlier this year, and its recommendations…
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Recent proposals for a Tobin Tax
Recently, the UK government proposed the levying of a ‘Tobin tax’ or a financial transactions tax to recover the cost of bailouts in recession situations. The proposal has not won many supporters; indeed, India is one of the countries which has opposed the tax. Despite initial rejections of the idea, the IMF is said to…
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Dissecting Indian Corporate Governance
India Knowledge@Wharton carries a discussion (or a mutual interview of sorts) between Wharton professors Jitendra Singh and Harbir Singh and former SEBI Chairman M. Damodaran on several issues pertaining to Indian corporate governance, including the role of independent directors. The discussion is rich in that it dissects several fundamental issues of Indian corporate governance, such…
