Related party transaction: What is “interest”?

Article

For those who have the experience of trying to decode the definition of “related party transaction” in the Listing Requirements, the term may seem like pieces of jigsaw puzzle to be put together.  

Under the Main Market Listing Requirements (“MMLR”) and ACE Market Listing Requirements (“AMLR”), “related party transaction” means a transaction entered into by the listed issuer/corporation or its subsidiaries which involves the interest, direct or indirect, of a related party.  

Most of the terms used within the definition of “related party transactions” can be found within the body of the MMLR and AMLR.  

The term “interest”, however, is in the FAQ for Chapter 10 of the MMLR and AMLR. “Interest” includes directorships, shareholdings (direct or deemed), commissions or such other benefits received or derived from the transaction.  

The information in this article is intended only to provide general information and does not constitute legal opinion or professional advice.  

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