A number of significant amendments have been made to the most recent draft of the Shareholder Rights (Directive 2007/36/EC) Regulations 2009 issued by the Department of Enterprise, Trade and Employment. These Regulations, which are due to implement the provisions of the much anticipated Shareholder Rights Directive into Irish law by August 2009, set out some important new provisions in relation to the rights of shareholders in listed companies.
Probably the most significant change relates to the definition of "shareholder" for the purposes of the Regulations. The first draft of the Regulations extended shareholder rights granted under the Regulations to holders of depository receipts and to other persons who held shares indirectly (possibly including beneficial holders). A&L Goodbody made a detailed submission in relation to the Regulations to the Department during the public consultation process on the Regulations and one of our key suggestions was that this aspect be amended so that the Regulations apply only to members within the meaning of the Companies Acts, that is, registered members of the company. Thankfully, the Department has taken this on board and the most recent draft of the Regulations now makes it clear that "shareholder" means the natural or legal person recognised as a member under the Companies Acts provided that such a member holds shares that carry rights to vote at general meetings.
Another welcome clarification relates to the area of non-UCITs. As we pointed out in our submission, the Directive allows for both UCITs and non-UCITs to be excluded from the ambit of the Directive, should the member state decide. However the first draft of the Irish Regulations excluded only UCITS, not non-UCITS. This will now be rectified, so that all UCITS and non-UCITS will be excluded from the remit of the Regulations.
There are a large number of other amendments to the Regulations, some of which take on board further comments made in our submission. However there are still quite a number of issues on which we have concerns and which may need further work.