Independent board committee (20.38-20.41)
The independent board committee must, taking into account the recommendation of an independent financial adviser, advise the listed issuer's shareholders:(1) whether the terms of the connected transaction are fair and reasonable;(2) whether the connected transaction is on normal commercial terms or better and in the ordinary and usual course of business of the listed issuer's group;(3) whether the connected transaction is in the interests of the listed issuer and its shareholders as a whole; and(4) how to vote on the connected transaction.
The independent board committee must consist only of independent non-executive directors who do not have a material interest in the transaction.
If all the independent non-executive directors have a material interest in the transaction, an independent board committee will not be formed.
If an independent board committee is formed, the circular must include a letter from the independent board committee containing its opinion on the matters in rule 20.38 and its recommendation.