The intended change of the sell-out procedure
Within the framework of the inter-ministrial consultation process the Republic employers council proposed new wording of Section 118i paragraph 9 of the Act No. 566/2001 Coll. on securities and investment services as amended . The abovementioned section addresses the situation where a minority shareholder violates his obligation to divest his shares within the compulsory divestment institute. While todays provision of the right of sell-out gives the majority shareholder in a public joint stock company the option to seek his right in court proceedings, the amendment would introduce a new solution to the problem.
The legislative proposal which was submitted within the inter-ministrial consultation process envisaged that in case of a breach of the duty the purchase price would be placed to a bank deposit and the shares of the violative shareholder would be declared invalid and new shares that would be provided to the majority shareholder would be issued.
This proposal was not accepted and the amendment of the Securities Act was presented to the Parliament without the said proposal.