New Rules for Corporate Groups in Europe (Fordham’s Corporate Law Center, March 27, 2014). This post comes from Tobias Tröger, LLM’04.

March 26, 2014 in Uncategorized by Anastasia A. Tolu, M.Jur. CGC Site Administrator

Tobias is currently a Professor of Private Law, Trade and Business Law, Jurisprudence at Goethe-University Frankfurt, Institute of Private-and Business Law.

On Thursday, March 27, Tobias Tröger (LL.M. 04) will give a talk at Fordham’s Corporate Law Center on “New Rules for Corporate Groups in Europe” as part of the “Comparative Corporate Governance Distinguished Lecture Series”.

The talk will address two aspects of the European Commission’s Action Plan and its imminent implementation that focus on specific issues of corporate groups. The proposed rules on related party transactions will be evaluated with a particular view to institutional investors’ corporate governance preferences. Furthermore, the Commission’s intention to allow a parent company to push through measures serving the “group interest”  vis-à-vis subsidiaries will be evaluated with regard to investor protection.

More information on the event here.

— Anastasia Tolu, Corporate Governance site administrator

March 26, 2014

Federico Raffaele’s Announcement: Teaching/Research Opportunity at LUISS, Rome, in 2014

January 21, 2014 in Uncategorized by Anastasia A. Tolu, M.Jur. CGC Site Administrator

Federico Raffaele is currently a Postdoctoral Research Fellow in Corporate Law, LUISS, Rome as well as an associate at Bonelli Erede Pappalardo. He is a graduate of HLS LLM’12.

Dear all,

Once again I want to signal the following teaching/research opportunities which I hope you may find of some interest.
The second edition of the “LL.M. in Business and Company Law: European and International Perspectives”, the program LUISS Guido Carli School of Law (Rome, Italy) – my University - launched last year, is starting. A broad range of topics as well as of countries is covered (please refer to the attached document). In my capacity as member of the Steering Committee, I’m therefore delighted to invite to Rome those of you who may be interested in giving one or more lectures on his/her own country with regard to the most significant and up-to-date trends in corporate governance.

During the first edition of the LL.M., many former Concentrators – including Jan Lieder, Enga Kameni, Alexander Zalivako, Pavlos Masouros – came to Rome and held some classes. It was a mutually-enriching experience and a great chance to see again some friends and to meet with very talented people.

In addition, please consider also our call for Visiting Professors, whose deadline is actually approaching, in case you are interested in coming to LUISS for research and teaching purposes (min. stay 1 month – max. 6 months/1 year). More detailed info may be found at

Please let me know if you are considering the foregoing opportunities so that we can arrange your coming to Rome in 2014.

Meantime, I wish you a happy (and a bit Italian…) new year!



The attached document can be accessed here.

— Anastasia Tolu, Corporate Governance site administrator

January 28, 2014

Transparency versus Confidentiality in Public Firms. This post comes from Sergio Gilotta LL.M.’09, Corporate Governance Concentration

December 2, 2013 in Uncategorized by Anastasia A. Tolu, M.Jur. CGC Site Administrator

(Sergio is currently an assistant professor at the University of Bologna. In 2012 he published the book “Trasparenza e riservatezza nella società quotata” (Transparency and Confidentiality in the Public Firm). An article appeared in the 2012/1 issue of the European Business Organization Law Review summarizing the major results of his research.))

* * *

Corporate transparency – and the set of rules mandating it – play a beneficial role for both firm governance and the well-functioning of the securities market. Firms, however, typically retain an interest in confidentiality over data and information that may be at the same time valuable for investors. How should the law address this fundamental conflict? I argue that too broad or unconditional disclosure duties are harmful, since they both weaken the firms’ incentives to innovate and also distort competition in the product market.

Mandatory disclosure systems are increasingly oriented toward price-efficiency goals and such a feature exacerbates the tension. Modern regulation does not tolerate delay in disclosure and demands an ever increasing level of detail in the information released. This is especially true for Europe, where securities regulation mandates listed companies to immediately disclose all their “price-sensitive” information. Some room for rightfully delaying the release of the information is provided, but the scope of the exemption is narrow and – worse – substantial legal uncertainty surrounds its use. Regulators should rebalance such rules, either enlarging the scope of the exemption or redefining the notion of price-sensitive information in more restrictive manner.

In addition, more space should be given to selective disclosure. Allowing issuers to disclose their most secrecy-sensitive data only to a predetermined pool of recipients (such as analysts) instead of releasing it to the public at large would be an effective means for preserving a high degree of informational efficiency in securities prices without harming the disclosing firm.

— Anastasia Tolu, Corporate Governance site administrator

December 9, 2013

In Re MFW Shareholders Litigation (Delaware): this post comes from Alexander Zalivako, LLM’12, Corporate Governance Concentration.

October 30, 2013 in Uncategorized by Anastasia A. Tolu, M.Jur. CGC Site Administrator

Alexander is currently an associate with Bonn Steichen & Partners (Luxembourg).

I have been recently working on a transaction which had the US controlled-merger as its element. In connection with some of that work, I had occasion to examine a recent relevant decision.

On May 29, 2013 the Delaware Court of Chancery (Ch. Strine) ruled in Re MFW Shareholders Litigation that the standard of review applicable to a merger with a controlling stockholder should be a business judgment rule if all of the following conditions are met. First, the merger is approved by an independent committee. Second, the independent committee can freely select its advisers, say “no” to the merger and actually discharges its duty of care. Third, the merger is co-approved by a majority of the minority shareholders.  Fourth, the minority shareholders have been duly informed and were not coerced into voting. Fifth, the controller undertakes not to proceed with any control transaction if either the committee or the majority of the minority shareholders do not approve the merger. Sixth, the above conditions for the merger are announced up-front.

This decision is important because it ends a 20-year old uncertainty of whether Kahn v. Lynch shall be treated as making any merger with the controller subject to the entire-fairness review (as the dictum of the Delaware Supreme Court would suggest).  According to the conservative reading of Kahn v. Lynch any protective devices shift the burden of prove of the entire fairness, but cannot “relax” the standard of review, because of the “inherent coercion” which is present in any transaction with the controller.  Ch. Strine ruled that the entire fairness standard of review will not apply is all conditions of MFW Shareholders are satisfied.

The decision also ends the puzzling inconsistency in the controlled merger / controlled tender offers case law in Delaware. Although, similar in economic result, the latter is subject to the business judgment standard of review if the tender offer of a controller is conditional on a non-coercive, non-waivable majority of the minority tendering into the offer followed by a short-form merger.

The full text of the decision is available here.

— Anastasia Tolu, Corporate Governance site administrator

October 30, 2013


Reliance on Experts from a Corporate Law Perspective. This post comes from Alexandros Rokas, LL.M. ’12, Corporate Governance Concentration.

August 22, 2013 in Uncategorized by Anastasia A. Tolu, M.Jur. CGC Site Administrator

Alexandros is currently an adjunct lecturer at the University of Athens. He recently published an article based on his LLM paper in the American University Business Law Review (Vol. 2:2, 2013, p. 323). The article is titled “Reliance on Experts from a Corporate Law Perspective”.

An overview:

In discharging their duty of care, directors of corporations are not expected to independently investigate all parameters affecting a decision they are about to make.  In fact, statutory provisions encourage or sometimes require directors to seek the advice of experts such as auditors, lawyers, investment bankers, and tax specialists.  In this Article, emphasis is placed on Section 141(e) of the Delaware General Corporation Law, according to which directors are entitled to rely on the advice of such experts as long as they believe that the advice was within the expert’s professional competence, the expert was selected with reasonable care, and reliance is in good faith. Apart from systematizing the elements of this rule, as they were interpreted by a significant number of court decisions, this Article sheds light on the interaction of the reliance defense with basic concepts of Delaware corporate law, mainly the business judgment rule as well as good faith after Caremark.  This Article does not examine whether directors will be eventually held liable (which, besides, is rarely the case in Delaware due to the business judgment presumption, exculpatory clauses, and insurance and indemnification provisions), but solely whether the additional defense of Section 141(e) should apply or not.

The article can be found here.

— Anastasia Tolu, Corporate Governance site administrator

August 26, 2013