Delaware lawmakers are debating a bill aimed at strengthening the state’s corporate law in response to concerns from tech giants like Meta and Elon Musk. The proposed legislation, known as SB 21, seeks to limit shareholder access to records of independent directors and alter how companies use these directors to ensure deal scrutiny is limited.
Governor Matt Meyer has been actively involved in addressing concerns about a potential “DExit” – a mass exodus of Delaware-incorporated companies from the state. Meta’s consideration of reincorporating elsewhere has prompted Meyer to convene meetings with attorneys, lawmakers, and industry representatives. The goal is to maintain Delaware’s reputation as a favorable destination for businesses.
SB 21 faces opposition from shareholders’ attorneys and investment groups, who argue that it could lead to self-interested decisions by controlling shareholders. Proponents of the bill, however, say it will help companies navigate complex regulatory environments more efficiently. A vote in the House of Representatives is expected soon, with passage pending a signature from Governor Meyer.
The debate highlights tensions between corporate interests and investor protections. Meta’s potential exit has sparked concerns about the impact on Delaware’s tax revenue and its position as a leading hub for company incorporation. The outcome will determine whether the state can maintain its reputation as a top destination for businesses.
Source: https://www.cnbc.com/2025/03/19/meta-billions-of-dollars-at-stake-in-overhaul-delaware-corporate-law.html