Representation Powers of Shareholders of Public Limited Companies in Spain
The representation system for public limited companies is different from that of limited companies in that, in principle, it is more open regarding the parties that may act as proxies on behalf of the shareholder (in public limited companies, representation of a shareholder may be carried out by anybody) and yet stricter regarding the manner of representation, given that it only allows the granting of special powers of attorney for each meeting and not general powers of attorney.
Thus, in Spain, the Spanish Companies Law stipulates that every shareholder entitled to attend general meetings may do so through a proxy, even if such proxy is not a shareholder.
The Articles of Association may limit this power, and certain restrictions to the representation power may be established, yet without imposing restrictions that may render the appointing of a proxy virtually impracticable. The most frequent restrictions include the requirement stating that the proxy must also be a shareholder or the prohibition to appoint the company directors as proxies.
In the case of publicly traded limited liability companies, the provisions under the Articles of Association that limit a shareholder’s entitlement to be represented by any party whatsoever at general meetings will be rendered null and void. However, the Articles of Association may prohibit substitution of the proxy with a third party, without prejudice to the appointment of an individual when the proxy is a legal entity.
Representation must be granted in writing or by means of a remote notification that meets the requirements established pursuant to this law for the exercise of the right to vote remotely, which is specially granted for each meeting.
Revocation of representation powers
Representation powers are subject to revocation at all times. In principle, attendance in person at the meeting by the represented shareholder causes the representation rights to be automatically revoked.
However, the company’s Articles of Association may provide for the fact that attendance in person at the meeting by the represented shareholder may not cause the total representation rights to be automatically revoked.
This article is not considered as legal advice