Yemen, Rep.

Protecting Investors in

Yemen, Rep.

Below is a detailed summary of the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 189 economies. The most recent round of data collection was completed in June 2013.

Compare Yemen, Rep. to 188 other economies.

Score Score Description
Extent of disclosure index (0-10) 6
What corporate body provides legally sufficient approval for the transaction? 2 Board of directors and Mr. James is not allowed to vote
Whether disclosure of the conflict of interest by Mr. James to the board of directors is required? 1 Existence of a conflict without any specifics
Whether immediate disclosure of the transaction to the public and/or shareholders is required? 0 No disclosure obligation
Whether disclosure of the transaction in published periodic filings (annual reports) is required? 2 Disclosure on the transaction and Mr. James' conflict of interest
Whether an external body must review the terms of the transaction before it takes place? 1 Yes
Extent of director liability index (0-10) 4
Whether shareholders can sue directly or derivatively for the damage that the Buyer-Seller transaction causes to the company? 0 No
Whether shareholders can hold Mr. James liable for the damage that the Buyer-Seller transaction causes to the company? 1 Liable for negligence or influencing the approval of the transaction
Whether shareholders can hold members of the approving body liable for the damage that the Buyer-Seller transaction causes to the company? 0 Not liable
Whether a court can void the transaction upon a successful claim by a shareholder plaintiff? 2 Possible when the transaction is unfair or entails a conflict of interest
Whether Mr. James pays damages for the harm caused to the company upon a successful claim by the shareholder plaintiff? 1 Yes
Whether Mr. James repays profits made from the transaction upon a successful claim by the shareholder plaintiff? 0 No
Whether fines and imprisonment can be applied against Mr. James? 0 No
Ease of shareholder suits index (0-10) 2
Whether shareholders owning 10% or less of Buyer's shares can inspect transaction documents before filing suit? 0 No
Whether shareholders owning 10% or less of Buyer's shares can request an inspector to investigate the transaction? 1 Yes
Whether the plaintiff can obtain any documents from the defendant and witnesses during trial? 0 No documents available
Whether the plaintiff can request categories of documents from the defendant without identifying specific ones? 0 No
Whether the plaintiff can directly question the defendant and witnesses during trial? 0 No
Whether the level of proof required for civil suits is lower than that of criminal cases? 1 Yes
Strength of investor protection index (0-10) 4.0

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