The Teva Case: A Tale of a Race to the Bottom in Global Securities Regulation

Forthcoming in Research Handbook on Representative Shareholder Litigation (Jessica Erickson, Sean Griffith, David H. Webber and Verity Winship eds, Edward Elgar, 2018)

European Corporate Governance Institute (ECGI) - Law Working Paper No. 416/2018

29 Pages Posted: 21 Aug 2018 Last revised: 28 Aug 2018

See all articles by Sharon Hannes

Sharon Hannes

Tel Aviv University - Buchmann Faculty of Law

Ehud Kamar

Tel Aviv University - Buchmann Faculty of Law; European Corporate Governance Institute (ECGI)

Date Written: August 1, 2018

Abstract

This article tells how a shareholder class action against Teva Pharmaceutical Industries, the largest generic drug maker in the world, ended the practice of hiding individual executive pay figures by companies crosslisted in Israel and the United States. That practice relied on a tenuous reading of the law, according to which crosslisted issuers are exempt from the pay disclosure requirements in both countries. It had nevertheless persisted with no regulatory response because both countries maintained a hands-off attitude toward crosslisted companies. While the class action prompted Israel to ensure crosslisted issuers disclose individual executive pay, crosslisted issuers continue to be less transparent in other areas. The story serves as an important reminder of the powerful race to laxity in the global competition for securities listings.

Keywords: Securities Regulation, Regulatory Competition, Race to the Bottom, Crosslisting

JEL Classification: G30, G38, K22

Suggested Citation

Hannes, Sharon and Kamar, Ehud, The Teva Case: A Tale of a Race to the Bottom in Global Securities Regulation (August 1, 2018). Forthcoming in Research Handbook on Representative Shareholder Litigation (Jessica Erickson, Sean Griffith, David H. Webber and Verity Winship eds, Edward Elgar, 2018); European Corporate Governance Institute (ECGI) - Law Working Paper No. 416/2018. Available at SSRN: https://ssrn.com/abstract=3224631 or http://dx.doi.org/10.2139/ssrn.3224631

Sharon Hannes

Tel Aviv University - Buchmann Faculty of Law ( email )

Ramat Aviv
Tel Aviv 69978, IL
Israel

Ehud Kamar (Contact Author)

Tel Aviv University - Buchmann Faculty of Law ( email )

Ramat Aviv
Tel Aviv 69978, IL
Israel
972-3-6407301 (Phone)

European Corporate Governance Institute (ECGI)

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
119
Abstract Views
714
rank
250,903
PlumX Metrics