Once bitten, twice shy – multiple voting shares in continental Europe

Over the last decade, several jurisdictions in continental Europe have somewhat lifted regulatory restrictions on multiple voting shares (MVS), in the form of dual-class share structures and/or loyalty shares. Though more heterogenous than coherent, all such reforms have been overly conservative and fall short of allowing the legal freedom of jurisdictions such as the United States and United Kingdom. In a globalized environment of regulatory and stock-exchange competition, this approach may be difficult to understand. This paper explores the reasons for the common conservative approach, which appear to lie mostly in early 20th century experiences of multiple voting rights in countries such as France, Germany, and Italy. For comparative purposes, the paper also investigates the completely different experience of the United Kingdom, where a liberal MVS framework produced distinct outcomes.