The City Code: is self-regulation the answer?

Article Abstract:

There are strong arguments for and against giving the Takeovers and Mergers Panel the power of direct legal sanctions in cases relating to mergers and takeovers. When the Panel was formed in 1968 as part of the City Code it was given the power to establish broad principles which were to be followed voluntarily. This was done to gave the panel greater flexibility to respond to new developments. The arguments against legal sanctions point out that legal sanctions would: increase advisors' efforts to circumvent rules; narrow the Panel's advisory functions; and increase decision-making delays. Strengthening legal sanctions would increase compliance by: reducing the incidence of actual of fictitious ignorance of the codes; and clarifying the confusion created by having more than one regulating body.

Author: Keenan, Denis, Anderson, John B.

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Another year of self-regulation

Article Abstract:

The UK Takeover Panel has had to consider the effects of 'golden', or special voting shares on corporate bids and takeovers. The issue is under investigation with British Petroleum Company PLC's takeover of Britoil PLC. The 'golden' shares of Britoil PLC only have voting rights if there is an offer to acquire 50% or more of the company. A problem with rules 9 and 10 of the Code was resolved by ignoring the 'golden' shares for rule 10 and by requiring an automatic bid for the remainder of the shares after 30% had been acquired.

Author: Keenan, Denis
Mergers, acquisitions and divestments, British Petroleum Company PLC, Petroleum industry, Britoil PLC

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Self-regulation in action

Article Abstract:

Rules recently enacted by the Takeover Panel of Great Britain are discussed. The Takeover Panel is a self-regulatory body responsible for controlling the mergers and acquisitions of corporations. The rules are designed to prevent false markets being created by rumors, and lay down guidelines announcing possible takeovers.

Author: Keenan, Denis
Management, Business, Accounting and auditing, Corporations

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Subjects list: United Kingdom, Laws, regulations and rules, Acquisitions and mergers, Accounting, Great Britain
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