blockage rule

Process of determining value of large blocks of corporate stock for gift and estate tax purposes, based on the postulate that a large block of stock cannot be marketed as readily and as advantageously in price as can a few shares. Montclair Trust Co. v. Zink, Prerog., 141 N.J.Eq. 401, 57 A.2d 372, 376, 380.
Application of this rule generally justifies a discount in the fair market value since the disposition of a large amount of stock at any one time may well depress the value of such shares in the market place

Black's law dictionary. . 1990.

Look at other dictionaries:

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