17 Colum. J. Eur. L. 23 (2010) Tomas Richter, Of Counsel, Clifford Chance LLP, Prague; Lecturer, Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague. Between the years 1996 and 2006, the Czech parliament and supreme court, in an attempt to protect shareholders from the consummation of private benefits of control, essentially shifted the agency costs embedded in internal governance of corporations from the corporations’ outside shareholders to the corporations’ counterparties. In this article, I hypothesize that this idiosyncratic outcome came about as an ill-considered, knee-jerk reaction to the asset-stripping excesses, often dubbed “tunneling,” that resulted from the country’s voucher privatization scheme in the early 1990s. To test the hypothesis, I compare-against […]