The Judicial Committee of the Privy Council has abolished the long-standing “Shareholder Rule,” overturning more than a century of precedent. In Jardine Strategic Limited v. Oasis Investments II Master Fund Ltd [2025] UKPC 34, the Board held that a company may assert legal advice privilege against its shareholders, bringing Bermuda and English law into alignment. The judgment stressed that the rule was incompatible with the separate legal personality of companies, discouraged candid legal advice, and wrongly assumed a unity of interest between shareholders and the company.
For corporate practitioners, the decision provides clarity in managing privileged communications during contentious processes such as appraisals, restructurings, or shareholder disputes. Companies can now maintain privilege with greater confidence, while investors can no longer rely on shareholder status alone to obtain access to legal advice. The ruling reinforces the principle that privilege rests with the client—the company—unless shareholders establish a defined common interest or enter into express governance arrangements granting access.
