BOSNIA & HERZEGOVINA Law and Practice Contributed by: Bojana Bošnjak-London and Nebojša Marić, Marić & Co Ltd
of mergers, extraordinary financial accounts may be required. 7.4 Transaction Documents The need to disclose transaction documents depends on the type of the companies involved and the level to which they are regulated. For instance, in the case of the acquisition of shares in private, non-regulated limited liability companies, disclosure obligations are quite modest, and transaction documents often include a short-form share purchase agreement to be provided to the authorities for registration purposes. However, in the case of regulated and/or joint stock companies, the disclosure obligations are more strin - gent, with regulators frequently requesting full details of the transaction. Directors are generally responsible for ensuring that the company’s operations comply with the law. As a result, although their duties are mostly owed to the shareholders, they always have to make sure that all of their actions are lawful and in the best interest of the company. 8.2 Special or Ad Hoc Committees It is not common for boards of directors to establish special or ad hoc committees in business combina - tion deals. 8.3 Business Judgement Rule There is limited court practice to draw on in this area; however, it is generally accepted that if directors act in good faith, with due care and in the best interests of the company and its shareholders, they will be protected from liability, unless they undertake unlaw - ful actions. The degree of judicial deference afforded to board decisions typically depends on the circum - stances of the takeover. 8.4 Independent Outside Advice Directors rely on financial, legal, tax, and regulatory experts to evaluate risks, structure deals, and com - ply with legal obligations. Seeking independent advice strengthens board decisions, mitigates liability, and 8. Duties of Directors 8.1 Principal Directors’ Duties
helps secure shareholder and regulatory approval. Financial advisers provide valuation analysis and fair - ness opinions, while legal counsel ensures compli - ance with corporate and securities laws. Accounting and tax experts assess financial risks and tax implica - tions, while regulatory specialists handle competition and antitrust approvals. Occasionally, proxy solicitors and PR firms are engaged to assist in shareholder engagement and public communication. 8.5 Conflicts of Interest Conflicts of interest involving directors, managers or controlling shareholders are addressed through cor - porate governance rules and fiduciary duty principles. Directors are required to act in the best interests of the company and disclose relevant conflicts. While there is limited public litigation specifically addressing conflicts in takeover contexts, corporate law provides a structured framework for managing such situations through disclosure, recusal and shareholder oversight mechanisms. Hostile takeover bids are uncommon, largely due to concentrated ownership structures and shareholder dynamics typical of the jurisdiction. 9.2 Directors’ Use of Defensive Measures There is no specialised statutory regime governing defensive tactics. Boards operate within general cor - porate governance and fiduciary duty principles when responding to takeover situations. 9.3 Common Defensive Measures Formalised defensive mechanisms are not a domi - nant feature of market practice. In takeover scenarios, outcomes are generally determined by shareholder structure and voting dynamics rather than by struc - tural defensive tools. 9.4 Directors’ Duties Directors must act lawfully, in good faith and in the best interests of the company. Any action taken in the context of a takeover must comply with statutory and fiduciary obligations. 9. Defensive Measures 9.1 Hostile Tender Offers
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