Investerarskyddssyftet och andra ändamål i aktiebolagsrätten och aktiemarknadsrätten
Author
Summary, in English
The purpose of this thesis is to illustrate the purpose structure of company law and stock market law, and the various arguments for interpretation that apply when applying the law in these areas. This is done through the analysis provided the contributions in the second part of the thesis (Part II) of a number of illustrative central corporate law and stock market law issues, and through the the in-depth and bridging analysis presented in the first part of the thesis (Part I). Part I provides background to the various issues analysed in Part II, but also a theoretical and methodological further development in connection with these.
The thematic thread runs through the investor protection interests and the market function and corporate governance interests that permeate the regulation of the two closely related areas of law that constitute company law and stock market law. Particular attention is paid to the common purpose structure of these legal areas and its significance for the interpretation of rules.
Limited liability companies fulfil an important socio-economic function. The legislature offers the limited liability company as a form of business organization in order to promote the conduct of business activities. Increased start-ups, expansion of existing businesses, innovation, and efficiency improvements are among the positive effects. This promotes the efficient use of resources in society—an efficient allocation of resources. It contributes to increased growth and economic prosperity in society.
A prerequisite for the limited liability company form to contribute in the best possible way to the generation of such social benefits is that limited liability companies have the opportunity to raise capital for their operations. As the thesis shows, an overall objective of company law regulation is therefore to minimize companies’ capital costs. The lower the capital costs of limited liability companies, the more efficient the use of resources in society, according to a simplified model of the more complex dynamics of reality.
The thesis shows that the same is basically true for stock market law. Only a small proportion of all limited liability companies are listed companies, but large values are attributable to this limited group of companies. The market for trading in shares differs from many other markets in that a share is merely a stake in the business activities of the company in question. A prominent reason for issuing these shares is to facilitate the supply of capital to the business. If the stock market does not function well as a tool for capital allocation and risk diversification, the capital procurement costs of limited liability companies increase. Avoiding this is therefore a prominent overall objective of stock market law, which can be seen as a supplement to company law for shares that are subject to organized trading.
Company law and stock market law thus share an overall objective. The most efficient use of resources in society is sought through a reduction of companies’ costs of capital.
However, when interpreting individual rules of company law or stock market law, which is the focus of this thesis, the most general regulatory objectives are rarely of concrete help. An important reason for this is that it is not normally possible in an individual case to empirically substantiate or otherwise draw firm conclusions about which interpretation is best suited to contribute to the achievement of the overall objectives.
Instead, individual rules are often associated with more immediate objectives, which in turn are assumed to contribute to the achievement of the overall objectives and can serve as more concrete guidance for interpretation in individual cases.
Since companies’ capital costs reflect the risks associated with investing in them, this in turn is considered to require that company law and stock market law offer investor protection that reduces these risks. Costs of capital increase by investor risks, and these risks are assumed to be reducible through rules that protect investor interests. ‘Investors’ here refer to providers of both equity and debt capital, but also to investors in the secondary market.
In order to achieve the overall cost reduction objective, it is also important that the regulatory framework enables effective corporate governance, i.e. that companies can be managed in a reasonably simple and inexpensive manner to promote a strong ownership function and a well-functioning market.
Company law and stock market law are thus combined, at a more immediate level, in the ambition to offer investor protection that reduces investor risks and to promote well-functioning corporate governance and a well-functioning market, all with a view to minimising companies’ capital costs in the long term. The purpose structure thus stands on two legs at this level. However, the two areas of law differ in that they address partly dissimilar investor risks and efficiency concerns.
With regard to investor protection, company law focuses primarily on risks that are attributable to the company in question taking decisions or measures that are unfavourable to individual shareholders or creditors, while stock market law mainly aims to reduce risks related to market actors making decisions that are affected by different types of market failures. For example, several stock market rules aim to minimize investor risks related to certain market players having more and better information than others. Some such rules aim to minimize the occurrence of so-called information asymmetries and contribute to more efficient price formation. Others focus on protecting investors from the abuse of information asymmetries that nevertheless exist, which could otherwise undermine confidence. Within the framework of investor protection, equal treatment of investors is a prominent immediate objective in both areas of law.
However, the legal system has no reason to try to reduce all investor risks, only those that are not related to what can be called the business risk. As the thesis shows, company law and stock market law are based on the fundamental idea that investors should bear the business risk associated with the investment, which is the essence of investing in commercial activities, but not, for example, the risk that the price of a share is based on misleading information or that someone uses the company to improperly enrich themselves at the expense of the company and individual investors.
In stock market law in particular, many rules are justified by the immediate aim of protecting investor confidence (trust). As the thesis shows, this protective aim is a kind of mirror image of the objective of limiting investor risk to business risk alone by providing investor protection. From this perspective, trust means not fearing losses other than those related to business risk to an extent that influences behavior. The less investors generally fear this, the lower the companies’ capital costs will be. The ideal is thus a risk premium (cost of capital) that only reflects the business risk.
Investors’ lack of trust that they will not suffer losses due to factors other than business risk can therefore be costly in terms of capital supply and thus detrimental to economic efficiency. Another way of expressing this is that phenomena that undermine trust can have negative external effects (externalities). Maintaining investor trust in the ability of the company law and stock market law systems to prevent such other risks is therefore a key task for the regulatory framework.
A graphical overview of the purpose structure of company law and stock market law is presented in Figure 1.
Protective purposes and other purposes are not only important in considerations from a regulatory perspective but also, which is central to this thesis, in the application of the law. For the rules to function as intended, judges and others tasked with interpreting them must understand the purpose structure and, as far as possible, apply the rules in a way that promotes the purposes.
A complicating factor in the application of law is that individual rules are often the result of a balancing act between more than one purpose. For example, a rule of company law on how a certain decision is to be made may have been formulated taking into account both the shareholder majority’s interest in being able to conduct business easily and cheaply, to promote a strong ownership function, and the minority shareholders’ interest in protection against abuse by the majority. Nevertheless, those interpreting a rule of this kind must take a position. This often requires a balancing act even within the application of the law. In order to strike the right balance, it is necessary to understand the policy considerations that have resulted in the rule and the regulatory framework of which it forms part. Awareness of the overall objectives of the regulatory framework is also important. This can reduce the risk of any individual immediate interest being overemphasized or, conversely, being overshadowed, with the result that efficiency is hampered at the overall level.
The thesis is a so-called compilation thesis. The contributions in Part II of the thesis consist of a selection of essays that I have written over a number of years. All of the contributions address, in one way or another, issues relating to investor or trust protection in company law or stock market law, or issues concerning the functioning of the market or corporate governance. They are linked thematically and methodologically in terms of the objective that governs both the various rules on which each contribution focuses and my analysis of these rules.
• First, in the section on company law, the decision-making rules of company law are illustrated with the help of two essays on the subject. This is followed by an analysis of the minority protection regime in company law and the relationship between the regulation in articles of association and in contracts. This is followed by a section focusing on contractual restrictions on the transferability of shares, followed by a section on restrictions on the transferability of shares laid down in the articles of association, with a focus on so-called pre-emption clauses. The following section also deals with the transferability of shares, in that it analyses certain issues relating to the compulsory redemption of minority shares.
• The section on stock market law first illustrates the disclosure requirements of listed companies, and restrictions on selective disclosure of inside information, with the help of a couple of articles on various aspects of this, followed by a section with four articles dealing with issues relating to public takeover bids, together with an article on how the stock market’s self-regulation, through the Swedish Securities Council’s standard-setting, relates to company law in connection with takeover bids and other phenomena on the stock market.
In the systematizing and further developing sections of Part I of the thesis, certain conclusions are drawn regarding the interpretation of rules in company law and stock market law, which can be summarized in simplified bullet points as follows.
1. Legal interpretation shall, as far as possible within the rules of the game, be carried out consistently so that the objectives are given the best possible effect. Consideration of the purpose may, in individual cases, justify restrictive or extensive interpretation, reductive interpretation, analogies, or conclusions e contrario.
2. Purpose-oriented interpretation requires awareness of the purposes.
3. Overarching purposes are general and difficult to grasp. They involve promoting business activity in the public interest by helping to keep companies’ (capital) costs as low as possible. It is difficult – and often impossible in practice – to determine in an individual case which interpretation is best suited to achieving the overall objective.
4. When balancing interests at a more immediate level – for example, between minority protection and the interest in simple and inexpensive corporate governance – it is nevertheless in reality, albeit often only implicitly, a matter of making assumptions about which alternative best promotes more general objectives.
5. It follows from points 2–4 that a one-sided (over)emphasis on a particular interest that merits protection (immediate objective) may result in interpretations that are suboptimal at an overall level. A balancing act is often required. However, sometimes a particular rule or regulation is intended purely to satisfy only one specific immediate interest, such as allowing the owners of a closely held company to prevent unwanted changes in the ownership structure by derogating from the principle of free transferability of shares. In such cases, this interest should, as a starting point, be given maximum effect and no balancing act is required. In such cases, it may nevertheless be necessary to assess when a particular interpretation is inappropriate because it goes beyond what is justified by the interest protected.
6. Due to the difficulties in point 3, the assumptions in point 4 regarding the achievement of overall objectives are often too uncertain to serve as a basis for conclusions in terms of interpretation choices in individual cases. Providing greater clarity is often either impossible or too extensive a task to be carried out in an individual interpretation situation. The question of interpretation must instead be decided with the help of other arguments of interpretation.
7. However, the statements in point 6 do not mean that awareness (at least approximate) of overall objectives is irrelevant in interpreting individual cases. In order to arrive at the best possible solution in terms of the objective pursued, the person applying the law must understand (at least approximately) what it is that he or she should try to achieve.
The thematic thread runs through the investor protection interests and the market function and corporate governance interests that permeate the regulation of the two closely related areas of law that constitute company law and stock market law. Particular attention is paid to the common purpose structure of these legal areas and its significance for the interpretation of rules.
Limited liability companies fulfil an important socio-economic function. The legislature offers the limited liability company as a form of business organization in order to promote the conduct of business activities. Increased start-ups, expansion of existing businesses, innovation, and efficiency improvements are among the positive effects. This promotes the efficient use of resources in society—an efficient allocation of resources. It contributes to increased growth and economic prosperity in society.
A prerequisite for the limited liability company form to contribute in the best possible way to the generation of such social benefits is that limited liability companies have the opportunity to raise capital for their operations. As the thesis shows, an overall objective of company law regulation is therefore to minimize companies’ capital costs. The lower the capital costs of limited liability companies, the more efficient the use of resources in society, according to a simplified model of the more complex dynamics of reality.
The thesis shows that the same is basically true for stock market law. Only a small proportion of all limited liability companies are listed companies, but large values are attributable to this limited group of companies. The market for trading in shares differs from many other markets in that a share is merely a stake in the business activities of the company in question. A prominent reason for issuing these shares is to facilitate the supply of capital to the business. If the stock market does not function well as a tool for capital allocation and risk diversification, the capital procurement costs of limited liability companies increase. Avoiding this is therefore a prominent overall objective of stock market law, which can be seen as a supplement to company law for shares that are subject to organized trading.
Company law and stock market law thus share an overall objective. The most efficient use of resources in society is sought through a reduction of companies’ costs of capital.
However, when interpreting individual rules of company law or stock market law, which is the focus of this thesis, the most general regulatory objectives are rarely of concrete help. An important reason for this is that it is not normally possible in an individual case to empirically substantiate or otherwise draw firm conclusions about which interpretation is best suited to contribute to the achievement of the overall objectives.
Instead, individual rules are often associated with more immediate objectives, which in turn are assumed to contribute to the achievement of the overall objectives and can serve as more concrete guidance for interpretation in individual cases.
Since companies’ capital costs reflect the risks associated with investing in them, this in turn is considered to require that company law and stock market law offer investor protection that reduces these risks. Costs of capital increase by investor risks, and these risks are assumed to be reducible through rules that protect investor interests. ‘Investors’ here refer to providers of both equity and debt capital, but also to investors in the secondary market.
In order to achieve the overall cost reduction objective, it is also important that the regulatory framework enables effective corporate governance, i.e. that companies can be managed in a reasonably simple and inexpensive manner to promote a strong ownership function and a well-functioning market.
Company law and stock market law are thus combined, at a more immediate level, in the ambition to offer investor protection that reduces investor risks and to promote well-functioning corporate governance and a well-functioning market, all with a view to minimising companies’ capital costs in the long term. The purpose structure thus stands on two legs at this level. However, the two areas of law differ in that they address partly dissimilar investor risks and efficiency concerns.
With regard to investor protection, company law focuses primarily on risks that are attributable to the company in question taking decisions or measures that are unfavourable to individual shareholders or creditors, while stock market law mainly aims to reduce risks related to market actors making decisions that are affected by different types of market failures. For example, several stock market rules aim to minimize investor risks related to certain market players having more and better information than others. Some such rules aim to minimize the occurrence of so-called information asymmetries and contribute to more efficient price formation. Others focus on protecting investors from the abuse of information asymmetries that nevertheless exist, which could otherwise undermine confidence. Within the framework of investor protection, equal treatment of investors is a prominent immediate objective in both areas of law.
However, the legal system has no reason to try to reduce all investor risks, only those that are not related to what can be called the business risk. As the thesis shows, company law and stock market law are based on the fundamental idea that investors should bear the business risk associated with the investment, which is the essence of investing in commercial activities, but not, for example, the risk that the price of a share is based on misleading information or that someone uses the company to improperly enrich themselves at the expense of the company and individual investors.
In stock market law in particular, many rules are justified by the immediate aim of protecting investor confidence (trust). As the thesis shows, this protective aim is a kind of mirror image of the objective of limiting investor risk to business risk alone by providing investor protection. From this perspective, trust means not fearing losses other than those related to business risk to an extent that influences behavior. The less investors generally fear this, the lower the companies’ capital costs will be. The ideal is thus a risk premium (cost of capital) that only reflects the business risk.
Investors’ lack of trust that they will not suffer losses due to factors other than business risk can therefore be costly in terms of capital supply and thus detrimental to economic efficiency. Another way of expressing this is that phenomena that undermine trust can have negative external effects (externalities). Maintaining investor trust in the ability of the company law and stock market law systems to prevent such other risks is therefore a key task for the regulatory framework.
A graphical overview of the purpose structure of company law and stock market law is presented in Figure 1.
Protective purposes and other purposes are not only important in considerations from a regulatory perspective but also, which is central to this thesis, in the application of the law. For the rules to function as intended, judges and others tasked with interpreting them must understand the purpose structure and, as far as possible, apply the rules in a way that promotes the purposes.
A complicating factor in the application of law is that individual rules are often the result of a balancing act between more than one purpose. For example, a rule of company law on how a certain decision is to be made may have been formulated taking into account both the shareholder majority’s interest in being able to conduct business easily and cheaply, to promote a strong ownership function, and the minority shareholders’ interest in protection against abuse by the majority. Nevertheless, those interpreting a rule of this kind must take a position. This often requires a balancing act even within the application of the law. In order to strike the right balance, it is necessary to understand the policy considerations that have resulted in the rule and the regulatory framework of which it forms part. Awareness of the overall objectives of the regulatory framework is also important. This can reduce the risk of any individual immediate interest being overemphasized or, conversely, being overshadowed, with the result that efficiency is hampered at the overall level.
The thesis is a so-called compilation thesis. The contributions in Part II of the thesis consist of a selection of essays that I have written over a number of years. All of the contributions address, in one way or another, issues relating to investor or trust protection in company law or stock market law, or issues concerning the functioning of the market or corporate governance. They are linked thematically and methodologically in terms of the objective that governs both the various rules on which each contribution focuses and my analysis of these rules.
• First, in the section on company law, the decision-making rules of company law are illustrated with the help of two essays on the subject. This is followed by an analysis of the minority protection regime in company law and the relationship between the regulation in articles of association and in contracts. This is followed by a section focusing on contractual restrictions on the transferability of shares, followed by a section on restrictions on the transferability of shares laid down in the articles of association, with a focus on so-called pre-emption clauses. The following section also deals with the transferability of shares, in that it analyses certain issues relating to the compulsory redemption of minority shares.
• The section on stock market law first illustrates the disclosure requirements of listed companies, and restrictions on selective disclosure of inside information, with the help of a couple of articles on various aspects of this, followed by a section with four articles dealing with issues relating to public takeover bids, together with an article on how the stock market’s self-regulation, through the Swedish Securities Council’s standard-setting, relates to company law in connection with takeover bids and other phenomena on the stock market.
In the systematizing and further developing sections of Part I of the thesis, certain conclusions are drawn regarding the interpretation of rules in company law and stock market law, which can be summarized in simplified bullet points as follows.
1. Legal interpretation shall, as far as possible within the rules of the game, be carried out consistently so that the objectives are given the best possible effect. Consideration of the purpose may, in individual cases, justify restrictive or extensive interpretation, reductive interpretation, analogies, or conclusions e contrario.
2. Purpose-oriented interpretation requires awareness of the purposes.
3. Overarching purposes are general and difficult to grasp. They involve promoting business activity in the public interest by helping to keep companies’ (capital) costs as low as possible. It is difficult – and often impossible in practice – to determine in an individual case which interpretation is best suited to achieving the overall objective.
4. When balancing interests at a more immediate level – for example, between minority protection and the interest in simple and inexpensive corporate governance – it is nevertheless in reality, albeit often only implicitly, a matter of making assumptions about which alternative best promotes more general objectives.
5. It follows from points 2–4 that a one-sided (over)emphasis on a particular interest that merits protection (immediate objective) may result in interpretations that are suboptimal at an overall level. A balancing act is often required. However, sometimes a particular rule or regulation is intended purely to satisfy only one specific immediate interest, such as allowing the owners of a closely held company to prevent unwanted changes in the ownership structure by derogating from the principle of free transferability of shares. In such cases, this interest should, as a starting point, be given maximum effect and no balancing act is required. In such cases, it may nevertheless be necessary to assess when a particular interpretation is inappropriate because it goes beyond what is justified by the interest protected.
6. Due to the difficulties in point 3, the assumptions in point 4 regarding the achievement of overall objectives are often too uncertain to serve as a basis for conclusions in terms of interpretation choices in individual cases. Providing greater clarity is often either impossible or too extensive a task to be carried out in an individual interpretation situation. The question of interpretation must instead be decided with the help of other arguments of interpretation.
7. However, the statements in point 6 do not mean that awareness (at least approximate) of overall objectives is irrelevant in interpreting individual cases. In order to arrive at the best possible solution in terms of the objective pursued, the person applying the law must understand (at least approximately) what it is that he or she should try to achieve.
Publishing year
2026-02-06
Language
English
Document type
Dissertation
Topic
- Law
Keywords
- company law
- stock market law
- Investor protection
- regulatory objectives
- capital costs
- efficiency
- corporate governance
Status
Published
Supervisor
ISBN/ISSN/Other
- ISBN: 978-91-7223-988-3
Defence date
27 February 2026
Defence time
13:15
Defence place
EC3:210
Opponent
- Mårten Knuts (Professor)