Mandatory Provisions Research Articles

Comment Letters to NASDAQ and NYSE: Time-Based Sunsets and the Problem of Early Unifications of Dual Class Share Structures

I am responding to the Council of Institutional Investors’ (“CII”) request that the NASDAQ Stock Market (“NASDAQ”) and New York Stock Exchange amend its listing standards to require companies seeking to go public with dual class shares (classes of common stock with unequal voting rights) to include in their certificates of incorporation a time-based sunset provision (a forced unification of shares into one share structure with equal voting rights after a certain period of time) that must go into effect no more than seven years after the initial public offering (IPO) unless the minority shareholders vote to extend up to an additional seven years. These letters (both letters have been combined into one document) argue that such a mandatory provision would be extremely unwise and harmful to our most important public companies and their shareholders, current as well as future. As a creation of private ordering, the absence of time-based sunset provisions in dual class share structures serves a significant value enhancing purpose. It prevents the risk that a pre-mature and therefore suboptimal unification of shares may occur. This risk has so far been ignored by those advocating for the implementation of a mandatory time-based sunset provision.

Javni poredak - pojam i struktura

The paper explores the essence and structure of public order as a general principle of every legal and social system, as well as a clause in international private law. The complexity, dynamics and importance of public order are described in this paper. The author emphasizes that public order in the broadest sense entails not only mandatory provisions, but also moral rules, accepted standards and judicial practice. This institute covers crucial social values, institutes and actions of public bodies. Public order has at least two objectives: 1) protection - public order protects human rights and freedoms as well as social community, 2) regulation of social processes, especially of public services. For this reason it is not possible to reduce public order to restrictions and/or orders. Finally, the author introduces the most important characteristics of public order and classifications of this institute.

The Case for Dual-Class of Shares

The debate over whether dual class of shares increases or decreases share value, should be prohibited or not, should be subjected to mandatory sunset provisions, and so on has been heating up over the last few years. This paper reviews the pros and cons of dual class of shares in light of more recent empirical results of (mostly) American studies. The paper surveys the evolution of dual-class companies in the Canadian context and makes a number of recommendations to enhance the usefulness of this type of capital structure and protect the rights of minority shareholders. The paper comes out against time-based sunset clauses but supports the obligation for dual-class companies to adopt a “coattail” provision, as is the case in Canada, which provision ensures that all shareholders will have to be offered the same price and conditions should the controlling shareholder decide to sell its controlling stake in the company. The paper also recommends that separate tallies of vote results be made public for each class of shares and that a third of board members be elected by shareholders with “inferior” voting rights. Not only is there growing evidence of their better economic performance but the coupling of dual class and family ownership brings about longer survivorship, better integration in the social fabric of host societies, less vulnerability to transient shareholders and more resistance to strategic and financial fashions. This precious form of ownership must come with appropriate measure to ensure and protect the rights of minority shareholders.

Why Dual Class Stock? A Response to CII's Petition to Nasdaq For Mandatory Sunset Provisions

On March 28, 2019 the Nasdaq Listing Council invited me to respond to the recent proposal by the Council of Institutional Investors (CII) requesting Nasdaq (and the NYSE) to adopt rules requiring a company going public with dual class shares to include a mandatory provision in the company's charter. Under the CII proposal, the company would generally have to convert the dual class shares into a single class after seven (7) years unless an extension was approved by stockholders voting separately as a class. This article briefly outlines my reasons for opposing CII's proposal and offers some alternative ideas for moving forward. My response focused upon three issues. First, I analyzed some of the governance and market forces that have led many of the most innovative and successful companies in the country (and indeed across the globe) to adopt dual class stock. This section focused upon what is the core issue of corporate governance but often goes unspoken: who gets to elect directors? This is the critical governance issue because directors manage the corporation and are responsive to those who elect them. Our corporate republic is not a direct democracy; stockholders do not run the corporation. Rather, corporations are managed and run by the board of directors. Yet over the last few decades, changes in the financial markets and the increased separation of from ownership has led to a situation where directors are increasingly elected by a small group of institutional investors and activist fund managers, including activist hedge funds. Confronted with a reality where directors are elected by this small group of investors, it should come as no surprise that some of our most innovative and entrepreneurial leaders, as well as those who support them, seek a better way to elect directors. Second, I identify some of the many problems with CII's analysis. As part of this, I demonstrate that many of the studies identified by CII do not support the claim for a seven (7) year sunset period, and in fact show that companies with dual class stock outperform their single class peers for considerably longer periods of time. Additionally, the most recent study by two highly respected scholars who have carefully reviewed all the literature and studies identified by CII concludes that compulsory sunsets, and time-based sunsets in particular, are an inappropriate response to the potential problems of dual class stock. In this section I further discuss recent studies that support a reality that I (and I suspect many practitioners) have long recognized: that there is little correlation between so-called best governance practices and either corporate performance or corporate governance. Rather, the studies on corporate governance typically measure adherence to the particular structural governance measures that are favored by certain institutional investors and/or academics, but that these studies do not measure whether in fact a company is well-governed, much less whether there is any correlation between a well-governed company and its performance. For this reason as well I discuss why it is important to continue to allow the system of private ordering on these types of governance issues to exist. The third section of my paper offered some specific compromise proposals to CII and other institutional investors, with the hope of better achieving the joint goals of fostering better governance while also opening up the process for director selection. In addition to discussing these proposals, I also call on the Nasdaq (and the NYSE) to continue to play their historic role as facilitators to this debate, and in my talk I suggested that Nasdaq consider convening a group of experts to consider the various issues and make recommendations to the exchanges.

Serbian citizens' awareness of consumer rights of tourists in the EU

This paper analyses the protection of consumers of tourism services in EU law and consumer awareness in this domain in Serbia as a country currently negotiating accession to the EU. Consumer rights in EU tourism are defined by directives and regulations. This paper shall separately analyse two directives and one regulation that directly pertain to the protection of consumers of tourism services. Most legal sources are the codification of business practices of tourist organizations within the EU, but a part of mandatory provisions is the result of the need to protect consumers of tourism services in the domains of tourism in which they are most exposed to violation of their rights. For the needs of this paper, the survey was carried out on the territory of the Republic of Serbia, for the purpose of obtaining information on citizens' awareness of the rights of consumers of tourism services in EU countries. The main aim of this study is to determine how well informed the citizens of Serbia are regarding consumer rights in tourism and legislation that governs those rights.

Individual's level of education as a guarantee of the right to defense

The right to defense is enshrined in national legislation, including Art. 59 of the Constitution of Ukraine, according to which, “Everyone has the right to a professional legal assistance. In cases provided for by law, this assistance is free of charge” [1]. In addition, there is Art. 52 of the Criminal Procedural Code (CPC) of Ukraine [2]. The lack of an appropriate level of education cannot be regarded as a certain mental defect or the fact of not speaking the language, since individuals could have an appropriate oral skill in Ukrainian, but not written skills. The problem lies not only in the lack of a unified approach in the practice of law enforcement regarding the application of legal grounds for the mandatory provision of a lawyer in criminal proceedings for persons who do not have the appropriate level of education, but also in the lack of a strictly defined level of education that would be considered sufficient to ensure persons' right to protection.

Правовое регулирование казенных поставок в Российской империи XIX – начала XX века

In the framework of the historical and legal research, the author analyzed the legislation of the Russian Empire of the XIX – early XX century on state supplies and its comparison with current legislation on supplies for state or municipal needs. Revealed similarities and differences, established their nature and legal nature. The conclusion is formulated that the evolution of the legislation on supplies for state needs has taken the path of liberalizing the legal status of the supplier, as well as the requirements for it. This concerns, first of all, the participation of the supplier in agreeing the terms of the supply contract to be concluded, as well as the possibility of concluding it without applying enforcement measures. It has been suggested that this pattern may be a consequence of the general strengthening of the lack of discretion of civil law, however, the question of the validity of such transformations, taking into account the specifics of supply relations for state and municipal needs, is questionable. It was concluded that the borrowing of the provisions on the mandatory provision of such agreements may positively affect the stability of the emerging legal relations.

Legislation plan for full mandatory Lawyer reparations liability insurance

전문가배상책임보험에 속하는 변호사배상책임보험은 변호사가 업무수행 중 발생하는 변호과오로 인하여 손해를 입은 의뢰인이나 제3자에 대한 손해배상책임을 전보해주는 보험을 말한다. 변호사배상책임보험의 운영방식에 대하여는 임의보험형태와 의무보험형태로 나누어져 있고, 각 나라마다 상황에 따라 다르게 도입하고 있다. 한국은 변호사배상책임보험을 임의보험형태로 2002년에 도입한 후 법률시장의 개방과 확대, 사회발전에 따른 국민의 권리의식의 향상 등으로 변호과오소송이 증가하자 2005년에는 법무법인(유한)과 법무 조합에게 보험가입을 강제하는 부분적 의무보험형태로 운영방식을 전환하였다. 변호사의 업무수행에 있어서 아무리 주의를 하여도 작거나 큰 의무위반행위가 발생 할 수밖에 없는 것이 현실이다. 또한 변호사의 법률사무 처리과정에서의 과실 등을 이유로 하는 손해배상청구가 증가하고 있고 변호사의 책임을 인정하는 법원의 판결이 선고되는 등 법률 소비자보호 인식이 확산되고 있다. 따라서 법률소비자보호와 변호사의 효율적인 업무수행활동과 경영안정성을 위해 변호사배상책임보험의 가입확대를 위하여 완전의무화를 위한 법제 도적 보완이 필요하다. 제도적 보완은 약관을 통한 보완으로는 부족하며, 변호사배상책임의 의무화 내용에 대한 분쟁의 사전예방을 위하여 실정법으로 규정할 필요가 있다. 현행법상 부분적 의무화 조항에 추가하여 전문가책임보상보험 전체에 대한 강제가입 등을 일반조항으로 상법 보험편에 신설하고 모든 변호사들이 변호사보상책임보험에 가입하도록 하는 조항을 변호사법에 추가하는 입법보완이 필요하다.The lawyer s reparations liability insurance, which belongs to the professional reparations liability insurance, is an insurance that tells the lawyer about the liability for damages to the injured client or a third party due to a defense mistake that occurs while performing business. Lawyers compensation liability insurance is classified into voluntary insurance and mandatory insurance, and is introduced differently in each country. In 2005, the Korea Lawsuit Corporation (LLC) increased its liability insurance by introducing liability insurance as a voluntary insurance system in 2002, opening up and expanding the legal market, and improving the public s sense of rights as a result of social development. And the statutory union to compulsory insurance. It is a reality that the attorneys are obliged to pay a minimum amount of attention or violation of their duty. In addition, claims for damages based on the negligence of the lawyer in the process of legal affairs are increasing, and the judgment of the court admitting the responsibility of the lawyer is sent to the public. Therefore, it is necessary to make legal and institutional supplement for full legal obligation to increase the participation of lawyer liability insurance for legal consumer protection, lawyer s efficient business execution activities and management stability. Institutional supplementation is insufficient for the supplementation through the contract, and it is necessary to prescribe as the actual law for the prevention of the dispute about contents mandatory of the lawyer indemnity liability. In addition to the partial mandatory provisions in the current law, it is necessary to supplement legislation to add the provision that all lawyers should be obliged to comply with lawyer liability insurance, Do.

Addressing Complexity of Migration Through Social Entrepreneurship:A Case Study of Tata Trusts Initiative in Uttar Pradesh

The concept of Corporate Social Responsibility has been in vogue for quite some time in the business world, though its origin can be traced back to olden times. Its roots can be traced back to all the philanthropic activities of the corporate houses and individuals across the globe. The concept has evolved globally. It encompasses all related concepts such as triple bottom line, corporate citizenship, philanthropy, strategic philanthropy, shared value, corporate sustainability and business responsibility. The CSR campaign has been actively supported by the world organizations like World Bank, UNDP, OECD, European commission andMNCs. CSR has been top on the agenda of policy makers, managers and activists in India. A large number of companies now report the CSR activities which are reflected in their official website, annual reports and even CSR reports. J. R. D. Tata introduced several welfare schemes as father of CSR / modern philanthropist in India. The Indian Companies Act, 2013 has made mandatory provision of CSR in India. It would be quite interesting to observe and study how it translates into practice at ground level and also how the understanding of the CSR in India undergoes a change. The recent initiatives of the present Government at the Centre seems certainly encouraging. It has directed its public sector undertakings to earmark certain percentage of their annual budget for the furtherance of the CSR activities. A Panel of Expert has also been constituted recently to suggest the framework to assess CSR activities undertaken by the companies under the Indian Companies act, 2013. The role of Tata Trusts in empowerment of migrant workers has been significant. Present paper discusses about the CSR in India, the Social business concept and highlights the modal of social entrepreneurship modal ofUttar Pradesh, under the Migration initiative of Tata Trusts in India

Trends and characteristics of enrolment in the National Health Insurance Scheme in Ghana: a quantitative analysis of longitudinal data

BackgroundIn 2004, Ghana started experimenting a National Health Insurance Scheme (NHIS) to reduce out-of-pocket payment for healthcare. Like many other social health insurance schemes in Africa, the NHIS is striving for universal health coverage (UHC). This paper examines trends and characteristics of enrolment in the scheme to inform policy decisions on attainment of UHC.MethodsWe conducted trend analysis of longitudinal enrolment data of the NHIS for the period, 2010–2017. Descriptive statistics were used to examine trends and characteristics of enrolment by geographical region and member groups.ResultsOver the 8-year period, the population enrolled in the scheme increased from 33% (8.2 million) to 41% (11.3 million) between 2010 and 2015 and dropped to 35% (10.3 million) in 2017. Members who renewed their membership increased from 44% to 75.4% between 2010 and 2013 and then dropped to 73% in 2017. On average, the urban regions had significantly higher number of new enrolments than the rural ones. Similarly, the urban and peri-urban regions recorded significantly higher number of renewals than the other regions. In addition, persons below the age of 18 years and the informal sector workers had significantly higher number of enrolment than any other member group.ConclusionsEnrolment in the NHIS is declining and there are significant differences among geographical regions and member groups. Managers of the NHIS need to enforce the mandatory enrolment provision in the Act governing the scheme, employ innovative strategies such as mobile phone application for registration and renewals and address delays in healthcare provider claims to improve enrolment.

Examining the Legality of Limitation of Liability Clauses under the GDPR

The question sought to be answered in this article is whether controllers/processors can contract outside the mandatory provisions of the GDPR. The liability of sub-processors to processors will also be examined. This article will seek to provide answers to these questions by analyzing the relevant legal provisions.

The Impact of the French Doctrine of Significant Imbalance on International Business Transactions

This article examines the concept of “significant imbalance” (SI) under French law and its impact on international business transactions. “Significant imbalance” is a legal standard meant to assess whether a contractual clause is unfair (abusive). Although initially restricted to consumer law, it has been extended to general contract law with the implementation of a reform entered into force on 1st October 2016. Previously, the Commercial Court of Paris in the ruling Ministry of Economy et al. v. Expedia, Inc. et al. (2015) had qualified SI as an “overriding mandatory provision” (loi de police) under EU Regulation No. 593/2008 on the applicable law to contractual obligations (Rome I). As a consequence, SI became operative in respect of international contracts despite an express choice of a foreign governing law made by the parties to the transaction. This article argues that, as a result of Expedia and the 2016 reform, French courts can interfere with international business transactions by striking down contractual terms that they deem unfair according to the SI standard. The analysis focuses on two key issues. On the one hand, notwithstanding recent judicial precedents, SI still fails to provide a reliable test for predicting which clauses or contracts are at risk of being deemed unfair. On the other hand, the legal arsenal supporting French legislator’s disapproval of SI allocates great power to French courts and the French government to pursue tort lawsuits against foreign companies allegedly oppressing their commercial partners with SI clauses. Empirical evidence shows that these actions are highly successful compared to those commenced by private actors. The article concludes that all these aspects, together with SI’s turbulent case-law throughout the years, will sprout uncertainty in international business transactions and may eventually disparage France in the global competition in such a field.

A New Strategy for Regulating Arbitration

Confidential arbitration is a standard precondition to employment. But confidential arbitration prevents a State from ensuring or even knowing whether employees’ economic, civil, and due process rights are respected. Further, employers regularly require employees to waive rights to class proceedings (thereby foreclosing small claims) and to arbitrate under the laws of another jurisdiction (thereby evading mandatory state law). In response, States have tried to regulate arbitration provisions, arbitral awards, and arbitral processes. But these efforts have all failed because the Supreme Court says they are preempted by the Federal Arbitration Act. In this Article, I argue that States can and should adopt a new strategy: Deter parties from forming such contracts in the first place. The Article proceeds in three parts. First, I explain the problem. Over the last fifty years, the Supreme Court systematically immunized arbitration provisions against every plausible contract defense. Yet the Supreme Court continues to insist that, just as the Federal Arbitration Act requires, arbitration agreements are still subject to “generally applicable contract defenses, such as fraud, duress, or unconscionability.” This is false. Second, I present the first large-scale evidence on the pervasiveness of arbitration. The Supreme Court’s arbitration precedents have effect only to the extent private parties agree to arbitrate their disputes. To study this, I use machine-learning protocols to parse millions of filings with the Securities and Exchange Commission and create a database of nearly 800,000 contracts formed by public companies. These contracts include employment agreements, credit agreements, joint ventures, purchases, and others. Employment contracts are by far the most likely to include a mandatory arbitration provision. Finally, I argue that, because the Supreme Court has all but stripped States of their power to enforce contracts, States should adopt policies that deter formation of objectionable contracts. For example, States cannot prohibit forced arbitration of sexual harassment claims. They can, however, prohibit sexual harassment as a subject matter for employment contracts; they can also enforce this with civil penalties and whistleblower rewards. Similarly, States cannot stop an employer from arbitrating under the laws of another jurisdiction, thereby evading mandatory limits on noncompete agreements. But States can declare noncompetes illegal, levy civil fines on employers that form them, and again offer employees whistleblower rewards to report violations. These approaches work because they create a cause of action for a third party - the State - who is not subject to the arbitration agreement. And unlike past efforts, these laws would not be preempted because they do not “derive their meaning from the fact that an agreement to arbitrate is at issue.”

Awareness on Corporate Social Responsibilty among the Consumers of Aluva Taluk

In today’s corporate world, the concept of Corporate Social Responsibility has been integrated into their strategic plans and policies. It has been incorporated into the decision making process taken in view of the competitive advantage that could be achieved through social initiatives. As consumers were the most sensitive group among the stakeholders to such initiatives, this paper tries to explore the awareness of consumers of companies towards CSR practices in AluvaTaluk. The paper also tries to examine whether CSR initiatives have any association with the consumers demographic profile. A total of 160 respondents were chosen from AluvaTaluk using convenience sampling technique. The data was collected through self-administered questionnaires and were analysed using SPSS 16.0 software. The study revealed that majority of the consumers of Aluva were aware of CSR but was unaware of the fact that it was a mandatory provision for the firms under the Companies Act, 2013. The consumers who were aware had only a medium level of understanding on the concept of CSR. Age, education and income of the consumers were found to have a significant association with their awareness on CSR.

Governance Issues in Dual Class Share Firms

In a typical public company, shareholders can elect the board, appoint auditors, and approve fundamental changes. Firms with dual class share (DCS) structures alter this balance by inviting the subordinate shareholders to carry the financial risk of investing in the corporation without providing them with the corresponding power to elect the board or exercise other fundamental voting rights. This article fills a conspicuous gap in the scholarly literature by providing empirical data regarding the governance of DCS firms beyond the presence of sunrise and sunset provisions. The summary data suggest that the governance of DCS firms is variable. A large proportion of DCS firms have no majority of the minority voting provisions and no independent chair. By contrast, almost half of the DCS firms have a sunset clause and a majority of independent directors. Finally, just under one-third of DCS firms have change of control provisions over and above existing law. On the basis of this evidence, this article argues against complete private ordering in favor of limited reforms to protect shareholders in DCS firms including: mandatory sunset provisions, disclosure relating to shareholder votes, and buyout protections that would address weaknesses inherent in DCS firms.

PROFESSIONAL ACTIVITY OF THE TEACHER OF INFORMATICS IN THE SECTOR OF INFORMATION SECURITY

In the article some aspects of the professional activity of the teacher of informatics in the sector of information security are analyzed. It is noted that the processes of informatization of the modern society and education cause the aggravation of the problem of information security. It is emphasized that the modern teacher of informatics plays a special role in the issue of information security. The teacher forms the skills of informational activity of students, from the skills and ethical use of information materials to the principles of creating their own resources and programs. A competent teacher must be a standard of the subject of secure information activity and at the same time must pay students' attention on the issues of information security in all aspects: pedagogical, psychological, legal, technical. The purpose of the article is to identify the peculiarities of the professional activity of the teacher of informatics in the sector of information security. Objectives of the article: 1) to analyze the content of the activity of the teacher of informatics in the sector of information security; 2) to consider the notion of informational culture of the teacher of informatics as a necessary component of the professional activity of a specialist in the sector of information security. Methods of research: theoretical analysis and synthesis of psychological and pedagogical literature in order to find out the content of the professional activity of the teacher of informatics and the phenomenon of information culture; generalization in order to determine the knowledge, skills and abilities of the teacher of informatics on the basis of studying of educational programs of training of specialists. It is substantiated that activity of the teacher of informatics in the sector of information security involves implementation of the preventive measures concerning safe information work at different levels (personal, group), definition of a rational system of information protection in the specific conditions of pedagogical work using modern information and communication technologies, etc. In this case it is necessary for teacher to possess a high level of information culture, aimed at the implementation of professional functions through the application of the latest information and communication technologies with the mandatory provision of information security requirements. The components of information culture of the teacher of informatics are: information-legal, program-technical, socio-cultural.

Factors influencing government insurance scheme beneficiary acceptance of the gatekeeper policy: a cross-sectional study in Wuhan, China

BackgroundGatekeeper policy, requiring a patient to visit a primary care provider first, and the patient needs to get his or her primary care provider’s referral before seeing a specialist or going to a hospital, has been implemented in China for about ten years, and it is necessary to assess the patients’ acceptance of gatekeeper policy and to explore the factors influencing patients’ acceptance.MethodsA cross-sectional study with 1162 respondents was conducted between July and September 2015 at four community health centers (CHCs) in Wuhan, China. Face-to-face interview was used to collect information on demographics, acceptance of the gate keeper policy and satisfaction with community health services. Patients’ satisfaction with community health service was evaluated using the European Patients Evaluate General/Family Practice scale and binary logistic regression model was used to examine the factors influencing patients’ acceptance of community health services as gate keepers.ResultsA total of 512 (43.06%) patients accepted gatekeeper policy. Mandatory reimbursement provision (OR: 1.63, 95% CI: 1.23–2.15), patient satisfaction with the aspects of medical care (OR: 1.92, 95% CI: 1.12–3.29) and organization of care (OR: 1.66, 95% CI: 1.05–2.62) were associated with acceptance of gatekeeper policy, after adjusting for potential confounders. Moreover, young people (OR: 0.35, 95%CI: 0.22–0.56) seemed to be more reluctant to accept the policy, when compared with the elder.ConclusionsOur study suggests that mandatory reimbursement provision greatly affects patients’ acceptance of gatekeeper policy, therefore, the policy-maker should pay attention to the negative effect of its mandatory reimbursement provision on patients’ acceptance of the policy. However, improving the aspects of medical care and organization of care will contribute to implementation of gatekeeper policy.

Compulsory Corporate Social Responsibility: An Empirical Assessment of Managerial Perspective in Indian State Owned Enterprises

In 2013, India became the first country to introduce a statutory requirement on businesses to engage in compulsory corporate social responsibility (CSR), providing a unique setting for researching challenges and impact of largescale compulsory CSR implementation. Any Indian corporation which had an annual turnover of more than 10 billion rupees was mandated to spend ‘at least two percent of the average net profits […] made during the three immediately preceding financial years.’ (Section 135, Companies Act 2013). Around 6,000 companies are thought to be affected by the new regime (Indian Institute of Corporate Affairs, 2012). This research examines the managerial perspective on changes to the design, experience and practice of CSR initiatives within SOEs in India. Before 2013, these SOEs engaged with local charities in a loose, unstructured and ad-hoc manner to conduct its CSR. Most of the focus was on providing donations to local educational institutions and regional social welfare organisations. However, with the advent of 2013 regulations SOEs had to completely alter their CSR regime to make it more structured, impact focussed, policy driven and functional. We have interviewed approximately 50 executives and directors from the top 40 Indian SOEs by revenue over a two years period (2015-16) to understand how the companies are adapting to the new regulations and what changes if any have been made. We find that while mandatory provisions do increase compliance burden, it does also provide a specific amount of money which needs to be spent and a structured and accountable way to do so. Our calculations show that under the new regulations Indian SOEs have to spend around 30 billion Indian Rupees per annum. This creates a tremendous opportunity for the businesses to invest in socially relevant enterprises and to internalise externalities.

Structure Permitting EU Airlines to Attract Non-EU Capital with the Investor's Interest Exceeding 50%

Current legal regime binding to EU airlines requires that the companies are continuously owned and controlled by EU nationals (natural or legal persons) or EU Member States; see EU Regulation No 1008/2008 of September 24, 2008; Art.4(f). In practice, noting the scarcity of any EU originating financing (that would be willing to accept the level of speculation and uncertainty inherent in the current EU aviation environment), the EU airlines obviously seek financing sources outside of EU. At the same time, the investors see prudence in demanding more efficient safeguard than the formally permissible 50%-1 share, on grounds of concern that their financing can be gulped up by the owners without consideration of investor's interests at their best. Accommodation of the investor's financial safety quest with mandatory EU legal provisions implies invocation of novel modes of cooperation. The following paper puts forward one such novel structure. The idea is to create a virtual equity majority for the Investor in the existing Airline's newly created spin-off units, the latter units being mutually bonded through 100% cross-shareholdings. EU aviation industry players are invited to consider the model for their operations with regard to terms and conditions of prospective non-EU investor engagements.

Brief of Amici Curiae Consumer Financial Regulation Scholars in Support of Plaintiff-Appellant Leandra English, English v. Trump, No. 18-5007 (D.C. Cir.)

In November 2017, a successorship controversy ensued over the rightful Acting Director of the Consumer Financial Protection Bureau (CFPB or the Bureau) following the resignation of the Bureau’s first Senate-confirmed Director. President Donald Trump appointed the Director of Office of Management and Budget (OMB), Appellee John Michael Mulvaney, as Acting CFPB Director, despite the Dodd-Frank Act’s command that the Deputy Director of the CFPB “shall . . . serve as acting Director in the absence or unavailability of the Director.” 12 U.S.C. § 5491(b)(5)(B). The White House countered that the Federal Vacancies Reform Act of 1998 (FVRA), 5 U.S.C. § 3345(a), authorized Mulvaney’s appointment. In this amicus brief, Amici Curiae Consumer Financial Regulation Scholars asserted that upon the Director’s resignation, the CFPB’s Deputy Director, Leandra English, became Acting Director and was entitled to serve in that role until a new Director was confirmed by the Senate or recess appointed. Amici contend that Deputy Director English’s claim is correct because the Dodd-Frank Act is the only statute that governs this succession dispute. In Dodd-Frank, Congress expressly decreed a mandatory line of succession for an Acting CFPB Director, stating that the Deputy Director “shall” serve as the Acting Director in the event of the Director’s vacancy. Congress enacted this provision after considering and rejecting the FVRA during the drafting of the Dodd-Frank Act. Further, Congress’s choice of this succession provision is intrinsic to the CFPB’s design as an agency with unique independence from policy control by the White House. The appointment of any White House official, but particularly the OMB Director, as Acting CFPB Director is repugnant to the statutory CFPB independence that Congress ordained. Nor does the FVRA apply to this case because it yields to subsequently enacted statutes with express mandatory provisions for filling vacancies at federal agencies. This is apparent from the text of the FVRA, from the FVRA’s legislative history, and from the basic constitutional principle that an earlier Congress cannot bind a subsequent Congress.