DP3006 Federal Intervention to Enhance Shareholder Choice

Author(s): Lucian Arye Bebchuk, Allen Ferrell
Publication Date: October 2001
Keyword(s): federal takeover, regulatory competition, shareholder, state takeover, takeover law
JEL(s): G30, H70, K22
Programme Areas: Financial Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=3006

In a recent article, we have put forward a new approach to takeover law and regulatory competition. We proposed a ?choice-enhancing? federal intervention that would provide: (i) an optional body of substantive federal takeover law which shareholders would be able to opt into (or out of) and which would be more hospitable than existing state takeover law, and (ii) a mandatory process rule that would provide shareholders the right to initiate and adopt, regardless of managers? wishes, proposals for option into (or out of) the federal takeover law. In this Paper, we respond to critics of our proposal, and we further develop the case for it.