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Related Party Transactions and Minority Shareholder Rights

image of Related Party Transactions and Minority Shareholder Rights

Related party transactions involve parties who can control the terms of a transaction in their favor potentially at the cost of the company. They include management, board members and controlling shareholders. The publication reviews provisions covering related party transactions and the protection of minority shareholder rights  in 31 jurisdictions, both OECD and non-OECD. In addition, the regulatory and legal systems that have beeen developed in five jurisdictions are reviewed in detail and allow a wide range of experience to be compared and lessons drawn. They are, Belgium, France, Italy, Israel and India. 

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Executive Summary

Around the world, the potential to abuse related party transactions (RPTs) covering both equity and non-equity transactions is viewed as an important policy issue even though they are seldom banned. Rather, jurisdictions have sought to put in place management and approval processes to minimise the negative potential. There is a wide variability across jurisdictions so that this report focuses on the experience of five jurisdictions (Belgium, India, Israel, Italy and France) with supplemental information from 31 others.

English

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