New Zealand: Members' Bill seeks to provide clarity concerning 'dry shares'

One of the members' bills recently successful in the ballot of those to be introduced was the Companies (Clarification of Dividend Rules in Companies) Amendment Bill. The Bill was introduced by Todd Muller MP - a copy is available here. The explanatory note can be viewed here. The purpose of the Bill is to make it clear that a company's constitution can create a class of shares in which some carry the right to dividends and others (known as 'dry shares') do not. This will be done through amending section 53 of the Companies Act 1993. The explanatory note accompanying the Bill cites as the classic example of such dry shares as being those belonging to a shareholder in a cooperative where the shareholder no longer supplies the cooperative.