Courts Right, Exchange and Politicians Wrong
Courts Right, Exchange and Politicians Wrong, On Fletcher Decision
It is a pity that National thinks like Labour on business law issues, ACT New Zealand Justice Spokesman Stephen Franks said today, commenting on National's joining in the complaints after Fletcher Forests received court approval to a 50 percent majority vote - instead of 75 percent - to sell its forests.
"The requirement for a 75 percent majority is sensible for listed companies, and was in the listing rules. It wasn't needed for other companies, so the 1993 Companies Act change to make it compulsory was just unnecessary prescription," Mr Franks said.
"No law change is needed now. All that is needed is for the Stock Exchange to reverse the unfortunate change it made to be the same as company law.
"Having listing rules that are the same as company law serves no purpose, and just invites populist politicians to make ignorant claims that political intervention is needed to protect shareholders.
"The court ruling was entirely sensible and consistent with practice and universal understanding since 1993.
"The pity is that other politicians jumping on the bandwagon
simply encourage Commerce Minister Lianne Dalziel's
micro-managing urges. The exchange should have admitted
it made the mistake, not the judge," Mr Franks.