Rights Layer Specification

Use Case: Shares (Shareholder Rights)

Status: Draft v0.1.0 — This section is informative.

Scenario

Mori holds 1,000 common shares of an example stock company. The Source of the shareholder Right is the entry recording that holding in the company’s shareholder register — a Source of kind registration. The issuing company keeps the register, so it appears as the Authority (registrar) and, when shareholder rights are exercised, as the issuer of Eligibility Responses; the shareholder register is the Evidence Source. The Object is the share class held.

One Right — the rights of a shareholder in respect of those shares — carries two Actions: vote and receive-dividend. Both hinge on the same characteristic mechanism of corporate law: the record date. The single Eligibility of vote states one requirement: the Subject is recorded in the shareholder register as holder on the record date fixed for the meeting. The single Eligibility of receive-dividend states the analogous requirement for the dividend record date. Whether Mori may vote at a given meeting depends not on today’s register but on the register as of the record date attached to that meeting — the same Subject can be answered true for one meeting and false for the next without the Right ever changing in existence. Establishing what the register said on the record date is the company’s evaluation, performed outside the layer; only its verifiable Boolean Eligibility Response enters the model.

The example carries a full exercise chain for vote at an annual general meeting: an ExerciseRequested Event at admission, an EligibilityResponseIssued Event for the company’s true Response (attested against the record-date register extract), the established Decision with its DecisionEstablished Event, the Exercise of casting the vote, and ExerciseStarted / ExerciseEnded Exercise Events. The receive-dividend Eligibility is left unanswered, so no Decision exists for that Action.

Mapping

Rights Layer concept Domain instance
Subject Mori, the shareholder
Object Common shares of the company (the holding)
Right Shareholder rights in respect of the recorded holding
Source Registration: entry in the shareholder register
Authority The issuing company (keeper of the register; registrar and Response issuer)
Action vote; receive-dividend
Eligibility (vote) Recorded as holder in the shareholder register on the record date fixed for the meeting (one requirement)
Eligibility (receive-dividend) Recorded as holder on the dividend record date (one requirement)
Eligibility Response (1:1) vote: answered true by the company against the record-date register extract; receive-dividend: unanswered in the example. How the company evaluates is outside the layer.
Evidence / Evidence Source Register extract as of the record date, from the shareholder register, referenced by the Response
Decision Established for vote because its single Response is verifiable and true; no Decision exists for the unanswered receive-dividend
Exercise / Exercise Event Casting the vote after the Decision was established; requested, started, ended
Event RightGranted when the holding was registered; transfer of the shares would end this Right

Chain Instantiation

flowchart TD
    S["Source<br/>Registration:<br/>shareholder register entry"] --> R["Right<br/>Shareholder rights<br/>(held by Mori)"]
    R --> A1["Action<br/>vote"]
    R --> A2["Action<br/>receive-dividend"]
    A1 --> EL1["Eligibility<br/>holder of record<br/>on the record date"]
    A2 --> EL2["Eligibility<br/>holder on the dividend record date<br/>(unanswered: no Decision)"]
    EL1 --> ER1["Response: true<br/>issuer: the company<br/>(record-date extract)"]
    ER1 --> D["Decision<br/>established: all Responses true"]
    D --> EX["Exercise<br/>casting the vote at the<br/>general meeting"]
    EX --> EE["Exercise Event<br/>requested / started / ended"]

What Rights Layer Does Not Model

Example

Machine-readable expression: shares.json