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EU Commission Proposes Shareholder Rights Directive
Washington, DC, January 9, 2006 - The European Commission has officially proposed a directive on shareholder rights to the European Council and the European Parliament. The new directive would complement and expand upon an EU “Transparency Directive” by setting forth minimum common standards for the exercise of voting rights by shareholders of publicly traded European companies.
The shareholder rights and transparency directives are part of a larger, ongoing effort in Europe to ensure transparency for investors and the public and to facilitate proxy voting.
In the shareholder rights directive, the Commission proposes to, among other things:
- abolish all forms of share blocking;
- remove all obstacles to electronic participation in shareholder meetings;
- allow a proxy to act on behalf of multiple shareholders; and
- require voting results to be published on issuer websites following meetings.
The Commission’s announcement begins the legislative process with the European Council and European Parliament that ultimately may result in the adoption of a directive. The European Council and European Parliament will take up the proposal over the next four to six weeks.
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