scholarly journals Protectionism and the EU Market for Corporate Control: Is It Possible to Get the Best of Both Worlds?

2018 ◽  
Vol 15 (2) ◽  
pp. 308-338
Author(s):  
Jonathan Mukwiri
Keyword(s):  
Corporate Control ◽  
European Parliament ◽  
Policy Choices ◽  
Market For Corporate Control ◽  
The Uk ◽  
Short Termism ◽  
The Eu ◽  
Made In

Recent reports of the Commission and the European Parliament have revisited the concerns of protectionism in the EU. This article discusses these concerns in light of the liberal and protectionist divide in the EU market for corporate control, focusing on the board neutrality rule during takeovers. The arguments advanced in this article are threefold. First, that liberal markets are likely to encourage takeovers, but breed short-termism. Second, that protectionist markets are likely to discourage takeovers, but facilitate long-termism. Third, that short-termism in the UK and the so-called protectionism in Germany are the result of entrenched policy choices made in those jurisdictions in regard to the interests they protect in regulating the market for corporate control. The article draws a conclusion that it is hard for the UK and Germany to get the best of both worlds, that is, the liberal market and long-termism.

Agency costs in the market for corporate control: evidence from UK takeovers

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Edward Jones ◽  
Bing Xu ◽  
Konstantin Kamp
Keyword(s):  
Agency Costs ◽  
Design Methodology ◽  
Corporate Control ◽  
Sales Growth ◽  
Content Type ◽  
Market For Corporate Control ◽  
The Uk ◽  
Practical Implications ◽  
Theory Framework ◽  
Made In

Purpose This paper aims to examine whether agency costs predict disciplinary takeover likelihood for the UK listed companies between 1986 and 2015. Design/methodology/approach Using survival analysis, the approach is to identify candidates for disciplinary takeover on the basis of Tobin’s Q (TQ), which is consistent with the approach advocated by Manne (1965). This study then examines how indicators of agency costs affect takeover likelihood within the set of disciplinary candidates. Findings This paper provides evidence of the effectiveness of TQ, rather than excess return, in identifying disciplinary takeover candidates. Takeover hazard for disciplinary candidates is higher for companies with higher levels of asset utilization and sales growth in particular. Companies with stronger agency problems are relatively less susceptible to disciplinary takeover. Practical implications Given the UK context of the study, where anti-takeover provisions are disallowed and when compared to findings of US studies, the results imply some support for the effectiveness of an open merger policy. Originality/value While the connection between takeover likelihood and the market for corporate control has been made in previous studies, the study adopts a more explicit agency theory framework than previous studies of takeover likelihood. A key component of the contribution follows from differentiating candidates for disciplinary takeovers from other forms of mergers and acquisitions.

The globalisation of General Principle 7: transforming the market for corporate control in Australia and Europe?

Legal Studies ◽  
2008 ◽  
Vol 28 (1) ◽  
pp. 96-118 ◽  
Author(s):  
Alan Dignam
Keyword(s):  
Financial Markets ◽  
General Principle ◽  
Common Law ◽  
Corporate Control ◽  
Concentrated Ownership ◽  
Eu Directive ◽  
Market For Corporate Control ◽  
Social Market ◽  
The Uk ◽  
The Eu

The integration of national financial markets over the past 30 years has resulted in a globalised market for corporate control which has increased both the opportunities for companies to fund acquisitions and the possibility of being acquired. Takeovers and mergers have, as a result, become a matter of some concern for governments, as they try to encourage the development of financial markets but also deal with the consequences of a globalised market for corporate control, where even companies regarded as national champions are within the reach of a foreign takeover. In the course of the last decade General Principle No 7 of the UK Takeover Code, that shareholders should decide the outcome of a takeover bid, has been adopted in many jurisdictions around the world and has formed the heart of the EU Directive on Takeovers. The Principle is however a controversial one, as its adoption is often viewed in civil law jurisdictions as an attack on a core part of a social market system. This has been particularly evident in the debate on the EU Directive on Takeovers. A number of common law heritage countries have also based their takeover regime around General Principle No 7 and many of these common law heritage counties have similarities with social market systems, in that they have less significant stock exchanges than the UK, the make up of their shareholding base is more concentrated and employment protections are more extensive. A central jurisdiction in that overlap is Australia, with exactly this combination. The purpose of this paper is to examine the historical effect of introducing UK takeover principles into the Australian system, by creating an empirical data set of takeovers of Australian listed companies covering the period before and after those UK-based principles were introduced. In doing so the paper found that factors such as concentrated ownership, capital controls and protective labour law have significant effects on the market for corporate control. There was no transforming effect evident in adopting an anti-managerial pro-shareholder takeover regime. As such, the fear that the adoption of a standardised EU-wide takeover Directive, along the lines of the UK Panel on Takeovers and Mergers' shareholder-oriented General Principle 7, would have a negative transforming effect on social market systems appears, on the Australian evidence, to be overblown, while other key features of such systems, particularly concentrated ownership and protective labour laws, remain in place.

Introduction

2020 ◽  
pp. 1-34
Author(s):  
Federico Fabbrini
Keyword(s):  
European Union ◽  
United Kingdom ◽  
European Parliament ◽  
The European Union ◽  
The United Kingdom ◽  
Uk Government ◽  
Article 50 ◽  
The Uk ◽  
The Eu

This introductory chapter provides an overview of the Withdrawal Agreement of the United Kingdom (UK) from the European Union (EU). The Withdrawal Agreement, adopted on the basis of Article 50 Treaty on European Union (TEU), spells out the terms and conditions of the UK departure from the EU, including ground-breaking solutions to deal with the thorniest issues which emerged in the context of the withdrawal negotiations. Admittedly, the Withdrawal Agreement is only a part of the Brexit deal. The Agreement, in fact, is accompanied by a connected political declaration, which outlines the framework of future EU–UK relations. The chapter then offers a chronological summary of the process that led to the adoption of the Withdrawal Agreement, describing the crucial stages in the Brexit process — from the negotiations to the conclusion of a draft agreement and its rejection, to the extension and the participation of the UK to European Parliament (EP) elections, to the change of UK government and the ensuing constitutional crisis, to the new negotiations with the conclusion of a revised agreement, new extension, and new UK elections eventually leading to the departure of the UK from the EU.

Markets and The Shareholders As A Class

2020 ◽  
pp. 89-118
Author(s):  
Paul Davies
Keyword(s):  
Corporate Control ◽  
Company Law ◽  
Executive Pay ◽  
Managerial Efficiency ◽  
Market For Corporate Control ◽  
Executive Remuneration ◽  
Control Set ◽  
Short Termism ◽  
Rule Making

This chapter analyses the way in which company law shapes two important markets—the market for executives and the market for corporate control—in the hope of addressing the agency problems identified in Chapter 1. Both sets of rules are controversial. The rules on executive pay make use of independent directors on remuneration committees and various forms of ‘say on pay’ to structure executive remuneration. But they have been criticised for not robustly linking pay to performance and for setting pay at socially unacceptable levels. The rules on the market for corporate control, set out mainly in the Takeover Code, contain a very strong version of the non-frustration rule, making it difficult for incumbent managers to defend themselves against unwelcome bidders. Here, it is heavily debated whether the rule promotes managerial efficiency or encourages ‘short termism’.

The Market for Corporate Control: Value, Stakeholders, and Governance

2016 ◽  
Author(s):  
David Kershaw
Keyword(s):  
Empirical Evidence ◽  
Corporate Control ◽  
Short Term ◽  
The Public ◽  
Analysis And Evaluation ◽  
Control Value ◽  
Clear Cut ◽  
Market For Corporate Control ◽  
Empirical Context ◽  
The Uk

This Chapter introduces the market for corporate control and provides theoretical and empirical context about the functioning and effects of the market for corporate control. Ideally such context should inform the analysis and evaluation of the Takeover Code’s regulation of the UK market for corporate control. However, as the Chapter shows, neither our understanding of the likely effects of the market for corporate control on companies, boards, shareholders and stakeholders, nor the state of empirical evidence provide clear cut guidance on how to regulate the market for corporate control. The Chapter considers evidence on the value effects of takeovers and shows that evidence from the short term market response to announced takeovers supports claims that takeovers in aggregate generate value, but the longer term evidence is more mixed and inconclusive. It also considers the methodological limitations of both the short term and long term evidence. The Chapter then proceeds to consider the effect of the market for corporate control on stakeholders. It explores the commonly held view that takeovers are detrimental for employees but finds again that the empirical evidence is inconclusive, although the theoretical case that takeover activity may undermine employee investment in the business remains compelling. The Chapter then explores the role of the market for corporate control as a governance device. It is often assumed that the market for corporate control acts as a disciplinary device holding managers to account, but as the Chapter shows the disciplinary effects work differently and less precisely than regulators and the public debate commonly assume. The Chapter also shows that such indirect effects may also mould management and board behaviour in economically suboptimal ways, which the Chapter considers in the context of the debate about the possible short term orientation of UK boards.

Cold Induced Abnormal Catches of Sole

1998 ◽  
Vol 78 (1) ◽  
pp. 345-347 ◽  
Author(s):  
J.W. Horwood ◽  
R.S. Millner
Keyword(s):  
North Sea ◽  
Cold Water ◽  
The South ◽  
Total Allowable Catch ◽  
The North ◽  
Solea Solea ◽  
The North Sea ◽  
The Uk ◽  
The Eu ◽  
Made In

Large catches of sole (Solea solea) were made in early 1996 from the south-western North Sea. Sole suffer physiological damage in waters below 3–4 C. In February 1996 cold water of 3–4 C unusually extended from the Continental coast onto the Dogger Bank. It is likely that the increased catches were due to the consequential distribution and behaviour of the sole, making them more susceptible to capture.Exceptionally large catches of mature sole (Solea solea (L.)) were made in February 1996 by Lowestoft fishermen from the south-western North Sea. Surprisingly this was not welcome. The UK allocation of the North Sea sole is -4 % of the EU Total Allowable Catch (TAC), and fishermen are restricted nationally, and by the fishing companies, to a tightly managed ration. The Lowestoft Journal (8 March 1996) reported the suspension of a local fishing skipper for not throwing back 5000 kg of sole caught in the Silver Pits. We will show that the abnormal catches were due to exceptionally cold waters.Sole in the North Sea are at the northern extremity of their range, with sole seldom living in waters below 5°C (Horwood, 1993). In fact, North Sea sole were successfully introduced into Lake Quarun, Egypt, where they lived in temperatures in excess of 30°C (El-Zarka, 1965). Young sole migrate from their shallow inshore nursery grounds, such as the Waddensea, as winter approaches (Creutzberg & Fonds, 1971).

scholarly journals Managing Disintegration: How the European Parliament Responded and Adapted to Brexit

2021 ◽  
Vol 9 (1) ◽  
pp. 16-26
Author(s):  
Edoardo Bressanelli ◽  
Nicola Chelotti ◽  
Wilhelm Lehmann
Keyword(s):  
Member State ◽  
Direct Consequence ◽  
European Parliament ◽  
The Political ◽  
Active Involvement ◽  
Indirect Impact ◽  
The Uk ◽  
The Impact ◽  
Political Groups ◽  
The Eu

Brexit makes both a direct and an indirect impact on the European Parliament (EP). The most direct consequence is the withdrawal of the 73-member strong UK contingent and the changing size of the political groups. Yet, the impact of Brexit is also felt in more oblique ways. Focussing on the role and influence of the EP in the EU–UK negotiations, and of the British delegation in the EP, this article shows that the process, and not just the outcome of Brexit, has significant organisational implications for the EP and its political groups. Moreover, it also showcases the importance of informal rules and norms of behaviour, which were affected by Brexit well ahead of any formal change to the UK status as a Member State. The EP and its leadership ensured the active involvement of the EP in the negotiating process—albeit in different ways for the withdrawal agreement and the future relationship—and sought to minimise the costs of Brexit, reducing the clout of British members particularly in the allocation of legislative reports.

scholarly journals The European Parliament Elections 2014

2014 ◽  
pp. 5-20
Author(s):  
A. Avilova ◽  
A. Gutnick ◽  
Y. Kvashnin ◽  
V. Olenchenko ◽  
N. Toganova ◽  
...  
Keyword(s):  
Case Studies ◽  
Debt Crisis ◽  
Public Awareness ◽  
European Parliament ◽  
Public Understanding ◽  
The Public ◽  
The Uk ◽  
European Parliament Elections ◽  
The Impact ◽  
The Eu

The article is devoted to the European Parliament elections held in May 2014. Their results are analyzed on two levels – national and pan-European. On the national one the authors provide case studies of the United Kingdom, France, Germany, Poland, Italy and Greece. The impact of economic crisis and later the severe public debt crisis in Eurozone countries on the EU Parliament elections is estimated. Another factor examined in the study is the public awareness of the EU’s institutions in everyday life. The authors point out the contradiction between the public opinion on these institutions and the ongoing process of further integration due to the crises in such fields as finances and government expenditures. The latest process is viewed by the experts as a positive one, but the lack of public understanding resulted in abstention, protest voting and the rise of right-wing and populist parties. The national case studies showed that the situation varied from country to country. In some of them the pan-European agenda has played a greater role, in others it influenced the elections, but in the end they were mainly a referendum on the national government performance. The case of the UK illustrated the first tendency, but partly also the second one: the elections not only put the question about the country’s role in the EU, but also reflected the citizens’ discontent in mainstream politics. France, Greece and partly Italy showed that the voters disapprove the EU politics, especially concerning such fields as immigration and economic and debt crisis. The Polish case demonstrates that the lack of information on the EU’s institutions can jeopardize the positions of centrist parties even in a very pro-European country. The election results in FRG confirm that the Germans are trying to identify their country’s role in the European institutions and find the right attitude toward its growing responsibility for the integration process.

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