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CALCULATING PROXY VOTES IN THE CONTROL THRESHOLD IN CROATIAN TAKEOVER LAW
Abstract
In the article the author analyses an open issue of calculating proxy votes in the takeover threshold according to Croatian Law. Since the Takeover Bids Directive does not specify the percentage of voting rights, which triggers the obligation to launch the takeover bid, nor the method for calculating the threshold, Member States are left to decide on these issues. The Croatian legislator has adopted the provisions on calculating the number and percentage of voting rights in Article 8 of the Croatian Takeover Act. According to the adopted solutions, when calculating the number of voting shares of the offeree company, held by the offeror and the persons acting in concert with him, voting shares entrusted to these persons shall be taken into account, under the condition the voting rights arising from those shares may be exercised independently, according to their own judgement, without special instruction of the shareholders. Although the Croatian legislator does not explicitly include proxy votes into the calculation rules, both the Croatian regulator and the courts have adopted a standpoint by which proxies are covered with this provision and should be calculated into the control threshold. The author finds it necessary for Croatian Takeover Act to include proxies with an explicitly regulated provision. Furthermore, it should be noted that, prior to 2007 there was no provision in the Croatian Takeover Act for calculating entrusted votes in the control threshold – now set at 25%+1 of voting rights. The paper points out to several open issues in this matter by analysing two cases. In the first case, proxies were solicited prior to, and in the second one after 2007. In the conclusion, the author evaluates the consequences of the adopted provisions and looks for appropriate solutions de lege ferenda.
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