[In this post, Sumit Agrawal, Partner and Surbhi Purohit, Associate from Suvan Law Advisors write about the increasing trend of stock market virtual games, apps and websites and how regulators may look at it. They can be reached at [email protected].] Background In recent times, the online stock trading apps and games have stirred up some controversy in the otherwise efficiently regulated realm...
Paper on Directors’ Duties and Stakeholder Interests
Mihir Naniwadekar and I have a working paper on SSRN titled “The Stakeholder Approach Towards Directors’ Duties Under Indian Company Law: A Comparative Analysis”, the abstract of which is as follows: Recognizing that common law does not cast any general duty upon directors towards non-shareholder constituencies, legislatures have sought to formulate a tolerable solution to what they perceive as a...
The State in Business and the Business of Regulation
[The following post is contributed by Bhargavi Zaveri, who is with the National Institute of Public Finance and Policy, New Delhi. She can be contacted at [email protected].] The public shareholders of a listed public sector bank were reportedly denied e-voting facilities at an extra-ordinary general meeting held in January 2016. In 2008, a state assembly passed a law unilaterally...
Due Diligence in Corporate Transactions and Insider Trading Laws
In corporate transactions involving shares of listed companies, the ability to conduct a detailed due diligence is constrained by laws that regulate insider trading. In a paper titled “Due Diligence in Share Acquisitions: Navigating the Insider Trading Regime”, I seek to examine this issue in detail. The abstract of the paper is as follows: The goal of this paper is to unpack the underlying...
Delaware Court on the Question of “Control”
We have been debating on this Blog (here, here and here) the concept of “control” in a company in the light of the Securities and Exchange Board of India’s (SEBI’s) consultation process that is currently underway. In this context, it would be useful to consider developments from elsewhere that may be instructive. This post considers a recent decision of the Delaware Chancery Court that called...
Winding-Up of a Foreign Company: Lessons from Hong Kong
[The following guest post is contributed by Suprotik Das, a 4th year law student at the Jindal Global Law School, Sonepat, Haryana.] This post seeks to address some developments with regard to the winding up of foreign companies and multiple derivative actions. On November 11, 2015, the Hong Kong Court of Final Appeal handed down a landmark decision in the case of Kam Leung Sui Kwan v...
Confidentiality Agreements in M&A Transactions
In May 2012, we had discussed the case of Martin Marietta wherein a confidentiality agreement was enforced in the context of an M&A transaction. Now, a California court has similarly enforced a confidentiality agreement in the case of Depomed, Inc. v. Horizon Pharma, PLC (accessed via the website of Wachtell, Lipton, Rosen & Katz). The facts of the case are summarized in the ruling:...
Changing Nature of the Corporation
The latest issue of the Economist carries two columns (here and here) that analyze the significant changes that have occurred in the nature of the modern corporation, particularly with respect to ownership. This is an addition to an earlier column in September. These columns highlight the more recent developments relating to the nature of the corporation, and question whether the diffused...
The Growth of Unsponsored American Depository Receipts of Indian Companies
[The following guest post is contributed by Dhanush. M, a 5th year student at the Jindal Global Law School] On October 10, 2008, amendments to section 12g3-2(b) of the Securities Exchange Act of 1934 became effective. The amendment allowed a foreign private issuer to have its equity securities traded in the U.S. over-the-counter market without registration under Section 12(g) of the...
US Court Rules on the AIG Rescue
During the global financial crisis that was triggered by subprime mortgages, the US Government engaged in rescuing several banks and financial companies. Through nationalization, the Government even acquired ownership and control over several of them.[1] One such was AIG. In that case however, a large shareholder of AIG mounted a legal challenge to the terms of the Government bail out package...
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