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What is stopping companies from maintaining fixed numbers of shareholders, perhaps with interceding intermediary entities. Example: Company A owns 1% of Faceboo
by iwwr 15y ago
What is stopping companies from maintaining fixed numbers of shareholders, perhaps with interceding intermediary entities. Example: Company A owns 1% of Facebook and the only purpose of Company A is to be a vehicle for Facebook ownership. Thus, another 500 entities can own Company A stock, in turn owning Facebook stock privately.
- tomp 15y agoThat's basically what GS tried to do earlier this year. I don't have the source (it was in an article on HN), and IANAL, but apparently the SEC rules would apply even in such cases, since the intended purpose and effect is the same.
- pasbesoin 15y agoI may be remembering the wrong context, but I recall the question of when somebody/company can be (legally) determined to be acting as an "agent" of another. If you are an agent, the rules continue to apply to the party to whom you are an agent. One reason shell companies are instantiated abroad.