7 Changes to Shareholders’ Rights and Remedies under the Companies Act 2016

One of the aims of the Companies Act 2016 is to strengthen shareholders’ rights. I anticipate further avenues for shareholders, in particular minority shareholders, to ensure that their rights are protected.

Shareholders

I set out below 7 changes to shareholders’ rights and remedies. In particular, some of these changes will likely lead to more shareholder litigation. This will test the exact limits of the new laws. For consistent reference, I will be referring to the term ‘shareholder’ and not to the term member of the company. Continue reading

How to Slay a Dragon – Shareholder Remedies in Malaysia

Within the corporate sphere, there is an ever-present tension between majority rule, where the majority shareholders are allowed to dominate the decision-making process, and that of protection of minority shareholders. Where majority rule is abused and is wielded in the majority’s self-interest rather than the interest of the company, then the minority shareholder may be able to seek court intervention for relief.

I have always found this area of company law fascinating and I will be writing more on this in future. This article will serve as a primer on some of the forms of shareholder remedies, especially in a Malaysian context.

slay_me Continue reading

In The Edge: Balancing Act for Directors

I was interviewed by The Edge Financial Daily and I shared my views on some of the challenges that directors will face under the upcoming Companies Bill.

theedge

“It’s not an easy balancing act to be done. But if you are speaking from the perspective of minority shareholders or even shareholders, I would say they will be welcoming these changes because there is more information, and the directors have to allow a platform for the shareholders to discuss, query, ask questions, even if it’s not contained specifically in any audited accounts.

“Free flow of information is quite welcomed,” Lee told The Edge Financial Daily after presenting his paper “New Companies Bill: Upcoming Changes and Impact on Directors and Shareholders” at the Malaysia Legal and Corporate Conference on Oct 7.

Although Lee welcomed the greater flow of information and interaction between the board and the shareholders, he warned of the possibility of shareholders abusing the new privileges to the detriment of the company and its operations.”

My views in The Edge were also briefly discussed on the BFM Morning Run on 19 October 2015.

It appears from the Parliament website that the Companies Bill 2015 was tabled for its First Reading on 19 October 2015 and for the Second Reading on 20 October 2015. So we are now in the process of ushering in the new laws.