Newsletter
SEEKING PROXIES IS NOT A GROUND FOR COPYING SHAREHOLDERS' ROSTER
When seeking proxies to gain control over a company, company insiders are generally at an advantage over market players because they have access to the shareholders information, making it easier for them to approach share-holders to seek proxies. For this reason, it has been a matter of dispute in M&A practice whether a shareholder that is not a company in-sider may apply to review or copy the share-holders' roster for the purpose of seeking proxies.
On 29 December 2004 the Ministry of Economic Affairs issued an interpretation that under the provisions of Company Act, shareholders' ap-plications to review or copy the shareholders' roster are limited to cases in which a legal in-terest exists, for example where the shareholder is a creditor or debtor of the company. As for proxy solicitation under the Rules Governing the Use of Proxies for Attendance at Shareholder Meetings of Public-issuing Companies, it mainly occurs in connection with the elections of di-rectors and supervisors, for the purpose of win-ning such elections. It does not meet the test of "legal interest" under the above provision of the Company Act. Therefore, proxy solicitation is not a legitimate ground to support an application to review or copy a company's shareholders' roster.