Original scientific paper
Pre-emption rights in the purchase of new shares
Petar Miladin
; Faculty of law, University of Zagreb, Zagreb, Croatia
Abstract
The pre-emption right in the purchase of new shares is central to the ownership end of a shareholder’s involvement as a separate and complex corporate ownership right. Generally speaking, the ownership end is significantly more limited in terms of legal
transactions available than the management end, with a plethora of management rights at their disposal. The available legal possibility to cancel or restrict the pre-emption right means that its legal protection is substantially limited. Joint stock companies tend to have interests which are not in line with the full protection of the pre-emption right, which is in the interest of shareholders. In the USA, the legal pre-emption right has replaced the right not to purchase. Share emissions by American public limited companies are generally not accompanied by the pre-emption right. This trend has, in turn, had an impact on corporate rights in the German legal circle, of which Croatian law is part. The article looks at American positions and pertinent German reactions, and suggests that the pre-emption right should not be made dispositive de lege ferenda. The so-called
simplified increase of equity capital referred to in § 186, paragraph 3, sentence 4 of Aktiengesetz should be applied in Croatian law as a rebuttable presumption, not as a rigid rule.
Keywords
pre-emption right; cancellation and restriction of the pre-emption right; equity capital increase by investment; approved increase of equity capital
Hrčak ID:
70314
URI
Publication date:
15.7.2011.
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