Despite concerns that a draft amendment to the Company Act (公司法) could undermine the rights of minority shareholders in listed companies, the Ministry of Economic Affairs’ (MOEA) commerce department yesterday downplayed such worries.
The legislature’s Economics Committee passed the amendment on Thursday, restricting minority shareholders from raising motions during annual general meetings if they own less than 1 percent of the shares in a company.
The draft amendment, along with several others, is scheduled for a third reading in the legislature on Friday. Once passed, they could become effective as early as next month.
The government said earlier that the amendment was aimed at maintaining order at listed companies’ annual general meetings, which are usually held this and next month and many often descend into chaotic scenes with minority shareholders deliberately tabling numerous motions to disrupt the meetings.
The department yesterday said that the amendment was not designed to damage the rights of minority shareholders and that it would include input from the government-run Securities and Futures Investors Protection Center.
“Minority shareholders can still raise motions as long as they collectively own more than a 1 percent share in the company,” the department said in a statement. “The department will discuss with the Financial Supervisory Commission in safeguarding the rights of minority shareholders.”