Balancing Business Objectives and Shareholders’ Rights in Voluntary Delisting: a Comparative Analysis of Selected Legal Jurisdictions

Abstract

Delisting a company from the stock market often negatively affects the interests of all related parties. For shareholders, the main detriment is their loss of the ability to trade and sell their shares on the open stock market. As voluntary delistings become a more prevalent market phenomenon worldwide, countries are seeking to implement regulatory protections during the process. The aim of this paper is to make a comparative analysis of the protection of shareholders during delisting across multiple jurisdictions including the United States, the UK, Germany, India, and Thailand that have adopted different regimes for protecting shareholders during a company’s voluntary delisting. The goal is to answer the question of which shareholder protection instruments in the covered jurisdictions have adopted to protect shareholder and company interests during delisting, and also to question the effectiveness of investor protection in voluntary delisting. The paper offers potential ways to better protect the rights of shareholders during the voluntary delisting process to achieve a balanced regulation of different corporate actors’ interests.