In September 2011 the European Securities and Markets Authority opened an investigation into “empty voting”, which it described as:
“The separation of the economic interest relating to shares from their voting interest (decoupling of voting rights), usually achieved by using derivative instruments and trading strategies in the securities markets…(i.e. having voting rights attached to shares without corresponding economic exposure).”
On 29 June 2012 ESMA released a Feedback Statement summarising responses received to its investigation. Based on its analysis of the responses, ESMA has decided that there is no basis for any regulatory action in relation to empty voting. From page 12 of the Feedback Statement:
“…ESMA believes that the feedback has not been sufficiently decisive to justify any regulatory action at European level. At this stage, and also taking into account the need for prioritisation of ESMA resources, it does not justify the need to conduct further analysis on this topic. Therefore, ESMA will not conduct any further research on empty voting for now.”
See also: What is empty voting?