COMPARATIVE ANALYSIS OF SHAREHOLDERS RIGHTS IN COMMON LAW AND CIVIL LAW JURISDICTIONS
AUTHOR – AMMAN KHAN, STUDENT AT JAMIA MILLIA ISLAMIA, NEW DELHI
BEST CITATION – AMMAN KHAN, COMPARATIVE ANALYSIS OF SHAREHOLDERS RIGHTS IN COMMON LAW AND CIVIL LAW JURISDICTIONS, INDIAN JOURNAL OF LEGAL REVIEW (IJLR), 6 (1) OF 2026, PG. 266-271, APIS – 3920 – 0001 & ISSN – 2583-2344.
(I) ABSTRACT
In every nation, the growth of financial markets and corporate governance depends on the legal protection of company shareholders. The protection of shareholder rights in general, particularly minority shareholder rights, is the greater concern, even though my study focuses on a comparative aspect of shareholder rights belonging to Common Law and Civil Law jurisdictions, which have been mainly classified by the US & UK versus Germany and France. I employed the Legal Origin Theory (LLSV)[1], a comparatively well-known and significant theory in comparative company governance. According to the argument, the Common Law system is better than the code-defined rigidity of the Civil Law systems based on the French model because judges’ flexibility and independence offer better protection of property and shareholder rights. But this study reconsiders this argument, which is supported by historical longitudinal data, leads to the counterargument that most civil law nations offer superior, if not clearly superior, protections for minority shareholders.[2] Rules intended to shield minority interests from majority demands are responsible for the most notable disparities. Minority shareholders have statutory safeguards in civil law nations that are known for their concentrated ownership. The fact that many jurisdictions’ current regulations are growing more and more hybrid is also noteworthy. For instance, India increases protections for all shareholders by contemporary legislation and regulatory modifications. This highlights once more how crucial the relationship between the “law in action” and the “law on the books” is.(II)
KEYWORDS: Shareholder Rights, Common Law, Civil Law, Corporate Governance, Legal Origin, Minority Protection.
[1] Garoupa N., Trends in Comparative Law and Economics 21–28 (Anthem Press 2022).
[2] Prabirjit Sarkar, Common Law vs. Civil Law: Which System Provides More Protection to Shareholders and Creditors and Promotes Financial Development, 2 Jarle 143-161 (2011).