Shares with Superior Voting Rights
An equity share with differential rights is like an ordinary equity share, but it provides more or fewer voting rights to the shareholder. The difference in voting rights can be achieved by increasing or reducing the degree of voting power. Companies Act, 2013 allows shares with superior and inferior voting rights. For any company planning to get listed on the stock exchanges, SEBI will allow it to continue to have DVR with superior voting rights only to technology driven companies, obviously subject to certain conditions as discussed later in the article. Issue of DVRs under Companies Act, 2013 Section 43 of the Companies Act, 2013 provides that Equity share capital can be – with voting rights or with differential voting rights as to dividend, voting or otherwise. As regards issue of fresh DVR, a company is required to comply with the conditions contained in Rule 4 of the Companies (Share Capital & Debentures) Rules, 2014 . Pursuant to the notification dated 5 t...