Definition: Effective minority control

Business registers

Effective minority control means having the effective control of a unit without having the majority of voting stock. It does not include indirect control via a majority-controlled subsidiary. The most common case is a minority but large shareholder and a very large number of dispersed small shareholders, none of which holds a significant share of the capital. The minority shareholder can thus exercise effective control insofar as no majority of shareholders is really able to oppose it. However, it is possible that the small shareholders join forces in order to have more influence over the strategic decisions.
Source:
Eurostat, "Business registers. Recommendations manual", Methodologies and Working Papers, Publications Office of the European Union, Luxembourg, 2010
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