Collaborative Pathways Between Directors' Fiduciary Duties and Investor Protection in Mergers and Acquisitions: A Comparative Analysis of Mainland China and Hong Kong

Guanchi Chen

doi:10.54097/v0dje097

Authors

Guanchi Chen

DOI:

https://doi.org/10.54097/v0dje097

Keywords:

Mergers and Acquisitions (M&A), Directors' Fiduciary Duties, Minority Shareholder Rights, Investor Protection, Mainland China, Hong Kong.

Abstract

This study conducts a comparative legal analysis of Mainland China and Hong Kong with respect to the interaction between the directors' fiduciary duties and investor protection in the context of mergers and acquisitions (M&A). It is essentially a comparison of the theoretical aspects of the legal frameworks of the two distinctly different jurisdictions and their actual applications along the frontline areas: scope and enforcement of the duties of loyalty and care of directors; regulation on information disclosure and transparency control, etc.; availability and effectiveness of minority investor protection mechanisms, including litigation pathways; and the nature of judicial review and the scope that case law has over and against statutory rules. Major findings indicate material variations that common versus civil law traditions, disparities in the degree of regulatory enforcement, and judicial treatment regarding director liability and shareholder remedies have created. The paper therefore proposed a set of integrated reforms, touching upon the legal, judicial, and corporate governance improvement that would, inter alia, remove the constraints of the Mainland Chinese system and bring greater legal clarity, enforcement consistency, and practical access to justice for minority investors.

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