History of Corporate Law
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Transcript of History of Corporate Law
8/7/2019 History of Corporate Law
http://slidepdf.com/reader/full/history-of-corporate-law 1/23
History of Corporate Law
Past & Present perspective of LegalFramework and Background events
8/7/2019 History of Corporate Law
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What We Know……
1. French Revolution – Idea of Nationalism introducedacross Europe
2. Unified Europe: Germany, Italy
● --Have become more stable (P.E.S. - IndustrialRev.) and unified under nationalism
3. Power Players: Great Britain, France, US, Germany,Italy, Belgium, Spain, and Portugal (In. Rev.)
4. Alliances: Triple Alliance and Triple Entente
5. Crisis in the Balkans - Pan Slavism`
Imperialismn The domination by one country
of the political, economic, orsocial life of another country or
8/7/2019 History of Corporate Law
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1. Self Sufficiency To gain control of resources
Ex. Iron, coal, manganese, tungsten, copper,rubber, coffee, tea, and spices
If at war, did not want to be “at themercy of the enemy.”
2. Need for New Marketsn New machinery - mass production
-looked to new markets
n $ to profit the sellers and increasewealth of nation
3. Outlets forPopulationn New Jobs
n If people settled in colonies owned by thesame country, the country wouldn’t reallybe “losing” people
8/7/2019 History of Corporate Law
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5. Missionary Motive
Spread of the Christian Religion to non-Christian peoples
Both Catholic and Protestant missionaries
Also education, medicine, & sanitation
4. Nation’s Strength, Pride &
Prestigen Colonies added to Nation’s Pride &Prestige
n Colonies were a good source of troopsfor armies
6. White Man’s Burdenn People of advanced western nations
had a duty to transmit western ideasand techniques to more “backward”people
n Ex. Machinery, agr-tech, democracy
n Each imperial nation considered itscivilization to be superior
n British Poet, Rudyard Kipling -“takeup the white man’s burden.”
8/7/2019 History of Corporate Law
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Social Darwinism
“Survival of the Fittest”Businessmen argued that the strong and
capable became successful, and the stupid andlazy failed.
Also true of nations -Europeans races as superior toall others.
Houston Stewart Chamberlain
(In Germany, Houston Stewart Chamberlain claimed that Germanswere the only pure successors of the Aryans. He singled out one groupas the racial enemy that wanted to destroy the Aryan race…)
8/7/2019 History of Corporate Law
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Two Viewpoints
European/Western
Great Britain, US, France, Germany, Italy…
Conquered Peoples
Africa, Latin America, China, India, …
X
Success & Obstaclesn Success?
n Technology & military strength
n Obstacles?n Resistance
n Tool of rich
n Immoraln Responsibility does not mean racial superiority
8/7/2019 History of Corporate Law
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Imperial Rule
Colonialism
Direct Rule (France) –
(Local rulers are replaced by Mother country officials and military officers
Indirect Rule (Britain) –
(local and mother country rule together)
Protectorate
Local rulers left in place, but officials of imperial power controlled the region
(political unit that depends on another govt for its protection)
Sphere of Influence
European power claims an investment in a certain area and tradingprivileges with the people
Example: Europe/China, United States/Latin America
8/7/2019 History of Corporate Law
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India - General
Jewel of the British Empire (direct control)
1857 - Sepoy Rebellion - First War of Independence
British rule brought Western culture, technology, andstability to India
Indians suffered economic hardships, corruption andsocial subjugation
Indian National Congress - 1885
“The Sun Never Sets on the British Empire.”
8/7/2019 History of Corporate Law
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British India
8/7/2019 History of Corporate Law
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Even though the INC and theMuslim League have different
ideas why do they work togetherat first????
INC
I HATETHE
BRITISH
Muslim League
I HATE THEBRITISH
TOO!!!
8/7/2019 History of Corporate Law
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Summary of the Major EnactmentsSecond half of the nineteenth century- UK Laws in Br India
1850 Act for Reg of JSC-following UK’s Comp Act, 1844
1857 Indian Companies Act
1866 Indian Companied Act, 1866 (X of 1866)
1882 Indian Companies Act, 1882 (VI of 1882)
1913 Indian Companies Act, 1913 (VII of 1913)-after UK’s Companies Act, 1908
-relating to company administration
1936 Indian Companies (Amendments) Act, 1936
8/7/2019 History of Corporate Law
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Independence
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Summary of the Major Enactments1947 Companies Act- 1913 act was adopted
1959 Company Law Commission was appointed-to rescind the outlived provisions
-to make law in consonance with the modern needs
1960 Submission of Report by CLC
1961 Chartered Accountants Ordinance, 1961
1966 Cost & Management Accountants Act, 1966
1969 Securities & Exchange Ordinance, 1969
1056 State Bank of Pakistan Act, 1956
8/7/2019 History of Corporate Law
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Debacle of East Pakistan
f h j
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Summary of the Major Enactments1972 Publication of Report CLCP
1972 Co (Managing Agency & Elec of Directors) Order, 1972
-issued on Jan 14, 1972-introduced several legal provisions relating to the directors
1984 Companies Ordinance, 1984
1984 Companies Ordinance, 1984
1997 Securities & Exchange Commission of Pakistan Act, 1997
8/7/2019 History of Corporate Law
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Relevance of corporatelaw on enterprise
Company law is directly related toenterprise: it can either promote it orhold it
Most enterprise is corporatised:
corporate regulation has a hugeimpact on the economy
8/7/2019 History of Corporate Law
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Sources of modern corporate lawCompany law in the commonwealth (UK, Australia, Hong Kong,Singapore, India, Malaysia) has common sources and influences
Common features also in European Union, US laws
UK Companies Act 1948 is the great mother of most corporate lawsworld over: but has undergone several changes over time:
1947 Cohen Committee report consolidated existing law in 1948 Act
Jenkins Committee report introduced changes in 1967
Several changes upto 1985 based on EEC Directives
New law in 1985 (747 sections and 25 schedules)
The new law changed substantially by Insolvency Act 1985 (later replaced byInsolvency Act 1986) (provisions on insolvency separated), Financial Services Act1986 (provisions on securities regulation separated) and Companies Act 1989
New Bill prepared in 2002 much smaller: 225 sections and 4 schedule
8/7/2019 History of Corporate Law
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Corporate law reformsCommercial law as a whole has been subjected to globalisation:
Most commercial problems are no more domestic problems
Today’s corporate laws cannot take a domestic approach:
Global trade has created the multi-jurisdictional enterprise
Leading to greater international interdependence
Global convergence of corporate laws:
Securities laws have been more intensively internationalised
Company law is still largely a domestic issue
UK reforms: The Department of Trade and Industry, UK started a company law reviewprocess in March 1998:
Scathing criticism by leading commentators as LCB Gower, LS Sealy, Law Society
EU reforms: High level Group of Company Law Experts set up in Sept 2001 and publiccomments were received.
These have now been synthesized and presented in Nov 2003
Pakistan Reforms: Over the years Corporate Law changed
From domestic perspective into Global arena