Rights of minority shareholders in LLCs and PLCs in Spain
The Spanish Companies Act stipulates some actions to protect the rights of minority shareholders to ensure the continuity of the company.
Shareholders Rights spain
A Shareholders’ Right to Withdrawal Due to a Lack of Dividend Distribution
The December 2018 reform of article 348 of Real Legislative Decree 1/2010, 2nd July, approving the consolidated text of the Law on Capital Companies, amends and clarifies the necessary conditions for a shareholder’s right to withdrawal due to a failure to distribute dividends in accordance with the mentioned law.
The abusive exercise of the shareholder’s right to information
The shareholder’s right to request for information about the company is a fundamental right. However, it is not an unlimited or absolute right. In this regard, the Spanish Supreme Court has already ruled this in different judgments.
The Right of exit of the Shareholder with the Entry into Force of Article 348. bis
Article 348.bis, which recognizes the right of exit of a minority shareholder due to failure to distribute dividends, entered into force on the 1st of January 2017 after the suspension of its validity by means of a transitional provision of the Corporate Enterprises Act, approved on the 2nd of October 2011.
The right to information of shareholders in Spain
Article 93 of the Law on Corporations (LSC) recognizes the right to information of shareholders and regulates separately limited liability companies (article 196) and public limited companies (article 197).
Simplification of the Rights of Shareholders in Spain
On June 23, the Spanish Legal Bulletin (BOE) released Law 1/2012, amending reporting and documentation obligations for company mergers and divisions. These changes, affecting the Capital Companies Act, notably highlight a shareholder’s right to withdraw if a company opts not to distribute profits.
The shareholder’s right to withdrawal in Spain for non distribution of dividends
Article 93 a) of the Spanish Companies Law (LSC in Spanish) expressly recognizes the shareholders’ entitlement to participate in company profit-sharing. Nevertheless, it is not an automatic entitlement, since, in principle, …
