Law Commons^™

Shareholder Exit Signs On Us And Eu Highways, Raluca Papadima

Raluca Papadima

Gandhi’S Prophecy: Corporate Violence And A Mindful Law For Bhopal, Nehal A. Patel

Nehal A. Patel

AbstractOver thirty years have passed since the Bhopal chemical disaster began,and in that time scholars of corporate social responsibility (CSR) havediscussed and debated several frameworks for improving corporate responseto social and environmental problems. However, CSR discourse rarelydelves into the fundamental architecture of legal thought that oftenbuttresses corporate dominance in the global economy. Moreover, CSRdiscourse does little to challenge the ontological and epistemologicalassumptions that form the foundation for modern economics and the role ofcorporations in the world.I explore methods of transforming CSR by employing the thought ofMohandas Gandhi. I pay particular attention to Gandhi’s critique ofindustrialization and principle of swadeshi (self-sufficiency) …

Transplanting Contractual Terms: The Influence Of The Common Law In The Civil Law Of Contracts, A View From The Periphery, Dario Laguado

Dario Laguado

This paper suggests a model of contractual innovation that takes into account the bottom-up transplant of legal devices from the core to the periphery. This model properly weighs the tension and differences between places of production and places of reception and the process of misreading that goes along with the transplant. It serves to explain the innovation that has been produced as a result of the influence of common law contracts in Colombia and South America. Evidence shows that this model can be generally applied to the process of transplantation in many jurisdictions around the world. The main features of …

Is Moderation The Highest Virtue? A Comparative Study Of A Middle Way Of Control Transaction Regimes, Yueh-Ping Yang, Pin-Hsien Lee

Yueh-Ping Yang

Comparative studies of control transaction regimes mostly compare between the Market Rule as adopted in the U.S. and the General Offer Rule ad adopted in European Union, while paying less attention to the Partial Offer Rule, a middle way model adopted in many East Asian countries such as Japan, South Korea, China, Taiwan, etc. In this paper, we attempt to fill this gap by highlighting the Partial Offer Rule adopted in these countries, analyzing this rule’s theoretical foundation and observing its implementation in practice. Our theoretical analyses of the Partial Offer Rule are comprised of two parts. First, by adding …

Law And Finance: The Case Of Stock Market Development In China, Zhong Zhang Dr

Zhong Zhang Dr

Having grown to one of the largest in the world in just over two decades, the stock market of China is cited as a counterexample to the significance of law for financial market development. A thorough examination of the development of China’s stock market however finds that law is actually critical to sustaining market growth and law did play a role in the growth of the market. On the other hand, the trajectory of development in China is growth first followed by law, and the improvement of law is caused by market growth. The experience of China hence suggests that …

Puzzles In Controlling Shareholder Regimes And China: Shareholder Primacy And (Quasi) Monopoly, Sang Yop Kang

Sang Yop Kang

Professor Mark Roe explained that the shareholder wealth maximization norm (“the norm”) is not fit for a country with a (quasi) monopoly, because the norm encourages managers to maximize monopoly rents, to the detriment of the national economy. This Article provides new findings and counter-intuitive arguments as to the tension created by the norm and (quasi) monopoly by exploring three key corporate governance concepts that Roe did not examine—(1) “controlling minority structure” (CMS), where dominant shareholders hold a fractional ownership in their controlled-corporations, (2) “tunneling” (i.e., illicit transfer of corporate wealth to controlling shareholders), and (3) Chinese state-owned enterprises (SOEs). …

An Approach To The Regulation Of Spanish Banking Foundations, Miguel Martínez

Miguel Martínez

The purpose of this paper is to analyze the legal framework governing banking foundations as they have been regulated by Spanish Act 26/2013, of December 27th, on savings banks and banking foundations. Title 2 of this regulation addresses a construct that is groundbreaking for the Spanish legal system, still of paramount importance for the entire financial system insofar as these foundations become the leading players behind certain banking institutions given the high interest that foundations hold in the share capital of such institutions.

Avenues To Foreign Investment In China’S Shipping Industry—Have Lease Financing Arrangements And The Free Trade Zones Opened Markets For Foreign Non-Bank Investment?, Rick Beaumont

Rick Beaumont

No abstract provided.

Insuring Floods: The Most Common And Devastating Natural Catastrophies In America, Christopher French

Christopher C. French

Optimized Theft: Why Some Controlling Shareholders “Generously” Expropriate From Minority Shareholders, Sang Yop Kang

Sang Yop Kang

Although controlling shareholder agency problems have been well studied so far, many questions still remain unanswered. In particular, an important puzzle in a bad-law jurisdiction is: why some controlling shareholders (“roving controllers”) loot the entire corporate assets at once, and why others (“stationary controllers”) siphon a part of corporate assets on a continuous basis. To solve this conundrum, this Article provides analytical frameworks exploring the behaviors and motivations of controlling shareholders. To begin with, I reinterpret Olson’s political theory of “banditry” in the context of corporate governance in developing countries. Based on a new taxonomy of controlling shareholders (“roving controllers” …

Re-Envisioning Investors’ Anti-Director Rights Index: Theory, Criticism, And Implications, Sang Yop Kang

Sang Yop Kang

‘Law and Finance’ theory – which offers analytical frameworks to measure the protection of public investors and the quality of corporate governance – has dominated the comparative corporate governance scholarship in the last decade. So far, many proponents and critics have had debates on the relevance of the theory and the implications of the theory’s empirical studies. Several important points in relation to shareholder protection, however, have been highly neglected in these debates. In particular, the significance of one-share-one-vote (OSOV) rule has been inappropriately underestimated. In response, this Article explores (1) why OSOV is an utmost critical component in corporate …

The Failure Of Corporate Internal Controls And Internal Information Sharing: A Conceptual Framework For Taiwan, Chang-Hsien Tsai

Chang-hsien (Robert) TSAI

Although East Asian jurisdictions such as Taiwan have been adopting similar models of Anglo-American independent directors and audit committees in recent years, we can find that common issues are failure of internal controls, in general, and dysfunctional internal information-sharing mechanisms, in particular. To accommodate Taiwan’s reform trend towards furthering the adoption of independent directors and audit committees, this paper offers a roadmap for conceptual solutions which are harmonic with each other as prerequisites to enable monitors of management to have the incentives and means to exercise their oversight. First, the board’s duty to monitor should be reiterated while being transplanted …

Bank Resolution In The European Banking Union: A Transatlantic Perspective On What It Would Take, Jeffrey N. Gordon

Jeffrey N Gordon

The project of creating a European Banking Union is designed to overcome the fatal link between sovereigns and their banks in the Eurozone. As part of this project, political agreement for a common supervision framework and a common resolution scheme has been reached with difficulty. However, the resolution framework is weak, underfunded and exhibits some serious flaws. Further, Member States’ disagreements appear to rule out a federalized deposit insurance scheme, commonly regarded as the necessary third pillar of a successful Banking Union. This paper argues for an organizational and capital structure substitute for these two shortcomings that can minimize the …

The Cost Of Doing Business In Asia: A Comparative Legal Study Of Environmental Regulations In The Emerging Markets Of Thailand, Malaysia, And Indonesia, Brooke R. Padgett

Brooke R. Padgett

Abstract: This article explores whether voluntary standards, customary law, or more binding bilateral investment treaties are best for corporations, the emerging markets of Thailand, Indonesia, and Malaysia, and the environment itself. While corporations, markets, and the environment facially seem to have divergent priorities, environmental disasters are more costly after the fact than they are to prevent so in reality their priorities may not be so different after all. Some of the potential issues the paper will examine and address are big picture macro level such as fairness to future generations, intergenerational rights; the actual cost through questions of polluter pays, …

Law And Finance: The Case Of Stock Market Development In China, Zhong Zhang Dr

Zhong Zhang Dr

In just over 2 decades China has developed a stock market that is now one of the biggest in the world. This is puzzling, considering that law in general and investor protection in particular in China is widely regarded as weak. However, a thorough examination reveals that, far from being a counterexample, the case of China lends strong support to the “law matters”’ thesis. Granted, investor protection counted for little during the rapid growth of the market before mid-2001. But by the early 2000s, outrageous securities frauds had become endemic, bringing the market to a serious crisis. Faced with a …

The Evolution Of The Digital Millennium Copyright Act; Changing Interpretations Of The Dmca And Future Implications For Copyright Holders, Hillary A. Henderson

Hillary A Henderson

Copyright law rewards an artificial monopoly to individual authors for their creations. This reward is based on the belief that, by granting authors the exclusive right to reproduce their works, they receive an incentive and means to create, which in turn advances the welfare of the general public by “promoting the progress of science and useful arts.” Copyright protection subsists . . . in original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or …

Controlling Shareholders: Benevolent “King” Or Ruthless “Pirate”, Sang Yop Kang

Sang Yop Kang

Unfair self-dealing and expropriation of minority shareholders by a controlling shareholder are common business practices in developing countries (“bad-law countries”). Although controlling shareholder agency problems have been well studied so far, there are many questions unanswered in relation to behaviors and motivations of controlling shareholders. For example, a puzzle is that some controlling shareholders in bad-law countries voluntarily extract minority shareholders less than other controlling shareholders. Applying Mancur Olson’s framework of political theory of “banditry” to the context of corporate governance, this Article proposes that there are at least two categories of controlling shareholders. “Roving controllers” are dominant shareholders with …

Directors’ Legal Duties And Csr: Prohibited, Permitted Or Prescribed In Contemporary Corporate Law?, Benedict Sheehy, Donald Feaver

Benedict Sheehy

Abstract: The interaction between CSR obligations and directors’ legal duties is seriously under examined. This article addresses that lack by examining directors’ duties in case law and legislation across the major commonwealth countries and the USA. It provides an analysis of leading cases and examines how they deal with the issues of the shareholder primacy doctrine, corporate legal theory, CSR and directors’ duties. The article reviews fiduciary relations and duties, analyses the directors’ duties to exercise power in the best interests of the company as a whole and for proper purposes. As this area of law is highly contested there …

Re-Envisioning The Controlling Shareholder Regime: Why Controlling Shareholders And Minority Shareholders Embrace Each Other, Sang Yop Kang

Sang Yop Kang

According to conventional corporate governance scholarship, controlling shareholder regimes exist in jurisdictions where minority shareholders are not well protected by controlling shareholders’ expropriation. However, Professor Ronald Gilson raises a critical point against the conventional view; if laws are inefficient and do not protect investors, as the conventional view explains, why do we observe any minority shareholders at all in such “bad-law” countries? One possible reason is that in response to controlling shareholders’ expropriation, minority shareholders discount severely shares that corporations issue. Then, a related question is: if it is true, why do some controlling shareholders in bad-law countries have many …

Do Social Ties Matter In Corporate Governance: The Missing Factor In Chinese Corporate Governance Reform, Yu-Hsin Lin

Yu-Hsin Lin

In the past decade, Asian countries have adopted various corporate governance measures with the hope that good law will facilitate capital market development. One of the measures adopted by Asian countries to revamp corporate boards is to enhance board independence by introducing the institution of the independent director. Empirical studies have shown that social ties could compromise independent directors’ monitoring capacity and, thus, do matter in corporate governance. Using theoretical and empirical studies, this article analyzes the effects that independent directors' social ties to corporate insiders can have on director efficacy and discusses how the United States, where the institution …

Ending Judgment Arbitrage: Jurisdictional Competition And The Enforcement Of Foreign Money Judgments In The United States, Gregory Shill

Gregory Shill

Recent multi-billion-dollar damage awards issued by foreign courts against large American companies have focused attention on the once-obscure, patchwork system of enforcing foreign-country judgments in the United States. That system’s structural problems are even more serious than its critics have charged. However, the leading proposals for reform overlook the positive potential embedded in its design.

In the United States, no treaty or federal law controls the domestication of foreign judgments; the process is instead governed by state law. Although they are often conflated in practice, the procedure consists of two formally and conceptually distinct stages: foreign judgments must first be …

After Privacy: The Rise Of Facebook, The Fall Of Wikileaks, And Singapore’S Personal Data Protection Act 2012, Simon Chesterman

Simon Chesterman

This article discusses the changing ways in which information is produced, stored, and shared — exemplified by the rise of social-networking sites like Facebook and controversies over the activities of WikiLeaks — and the implications for privacy and data protection. Legal protections of privacy have always been reactive, but the coherence of any legal regime has also been undermined by the lack of a strong theory of what privacy is. There is more promise in the narrower field of data protection. Singapore, which does not recognise a right to privacy, has positioned itself as an e-commerce hub but had no …

Threats Escalate: Corporate Information Technology Governance Under Fire, Lawrence J. Trautman

Lawrence J. Trautman Sr.

In a previous publication The Board’s Responsibility for Information Technology Governance, (with Kara Altenbaumer-Price) we examined: The IT Governance Institute’s Executive Summary and Framework for Control Objectives for Information and Related Technology 4.1 (COBIT®); reviewed the Weill and Ross Corporate and Key Asset Governance Framework; and observed “that in a survey of audit executives and board members, 58 percent believed that their corporate employees had little to no understanding of how to assess risk.” We further described the new SEC rules on risk management; Congressional action on cyber security; legal basis for director’s duties and responsibilities relative to IT governance; …

Exit, Voice And International Jurisdictional Competition: A Case Study Of The Evolution Of Taiwan’S Regulatory Regime For Outward Investment In Mainland China, 1997-2008, Chang-Hsien Tsai

Chang-hsien (Robert) TSAI

This Article explores the interplay of demand and supply forces in the market for law through international jurisdictional competition led by offshore financial centers. To do so it uses the example of the evolution of a regulatory regime imposed by an onshore jurisdiction, Taiwan, to control outward investment into mainland China (“China-investment”). The argument is that jurisdictional competition brought about by capital mobility or exit will provoke legal changes to prevent the departure of capital when laws reduce the value of remaining within the jurisdiction. The case study is used to examine the extent to which jurisdictional competition fuelled by …

Corporate Obligations Under The Human Right To Water, Jernej Letnar Cernic

Jernej Letnar Černič

Almost a billion people do not have access to clean and safe water. Access to safe drinking water and sanitation is increasingly being considered a fundamental human right. Corporations play an important role in the realization of the right to water. For example, they can become violators of the right to water where their activities deny access to clean and safe water or where water prices increase without warning. Corporations can have a positive or negative impact on the human rights of individuals, wider communities and indigenous peoples. This paper argues that corporations bear a certain responsibility for the realization …

International Jurisdictional Competition Under Globalization: From The U.S. Regulation Of Foreign Private Issuers To Taiwan’S Restrictions On Outward Investment In Mainland China, Chang-Hsien Tsai

Chang-hsien (Robert) TSAI

Drawing a lesson from the story that the Sarbanes-Oxley Act drives away foreign issuers and then their physical exit provokes a change in the U.S. regulation of non-U.S. issuers, this article takes as another case study the phenomenon that Taiwanese firms list shares overseas, to further test how usual law market demand and supply forces (or underlying exit and voice rights) interplay under international jurisdictional competition. Put simply, both cases of the U.S. and Taiwan significantly elaborate that law market forces underlying international jurisdictional competition are similarly at work even on both sides of the Pacific Ocean. Specifically, globalization strengthens …

Instituições, Trabalho E Pessoas, Paulo Ferreira Da Cunha

Paulo Ferreira da Cunha

Os especialistas em doenças terminais sabem que ninguém tem saudades, quando abandona a vida, do trabalho que não fez. Tem saudades sim do tempo que não passou com familiares e amigos. A sociedade contemporânea, e algumas instituições "totais" estão a potenciar até ao expoente demencial a exploração e a despersonalização dos trabalhadores, designadamente proletarizando técnicos superiores e técnicos pensantes que, sem ócio criativo, deixarão de criar. É uma crise civilizacional, nada menos.