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Share repurchase regulations: do firms play by the rules?

Hamon, Jacques; Ginglinger, Edith (2005), Share repurchase regulations: do firms play by the rules?, EFMA 2006, 2006-07, Madrid, Espagne

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Type
Communication / Conférence
Date
2005
Conference title
EFMA 2006
Conference date
2006-07
Conference city
Madrid
Conference country
Espagne
Pages
35
Metadata
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Author(s)
Hamon, Jacques
Ginglinger, Edith
Abstract (EN)
Open market share repurchases are strictly regulated to prevent companies from profiting from insider information. We examine compliance with these rules in France, where the mandatory disclosure of share repurchases provides detailed information on repurchases actually undertaken. Using a database containing 36,848 repurchases made by 352 French firms over the period 2000-2002, we show that very few firms fully comply with the regulations for all their buybacks. Non-compliance has an adverse effect on liquidity only for the smallest and least liquid firms.
Subjects / Keywords
Insider Trading; Open Market Share Repurchases; Regulations; Liquidity
JEL
G35 - Payout Policy
G18 - Government Policy and Regulation
K22 - Business and Securities Law