To convene a General Meeting, proof of the status of the shareholder is sufficient, without it being necessary that the shareholder have a minimum percentage of the share capital. In cases other than the calling of an ordinary General Meeting, the following requirements must be met:
- The applicant shareholders must represent a minimum of 5% of the share capital.
- The shareholders must have made a notarized request to the board of directors to convene
- A period of 2 months must have elapsed since the request without convening or celebration of the meeting.
- The written request must contain the points to be dealt with in the meeting.
At the request of any shareholder, the judge corresponding to the registered office of the company may convene a meeting prior to a court hearing of the board of directors in the following cases:
- When the General Meeting has not been convened by the directors within the time limit set by law or the company’s bylaws
- In the event that the directors did not address the call request made by the shareholders
- When, at the request of any shareholder, it is necessary to appoint directors
- In the event of the death of the sole director, all joint and several directors or joint directors
The convening of the judicial meeting must be made within one month from the date of the shareholder’s request.
Form of convening
The judicial call for capital companies should be carried out in accordance with legal and statutory provisions, so it is advisable to incorporate in the request letter a verbatim transcript of the article of the statute governing the regime of the call.
Regarding who issues the notice of the meeting, the majority view is that the call is legal, so it should be the court itself which, following publication of the process, carries out the necessary actions for issuing the convocation in the terms included in the articles. However, in order to avoid the risk of challenge, it is advisable to request the court’s authorization to perform, at the company’s expense, any legal or statutory measures necessary to publish the notice of the general meeting.
Regarding the venue, it is possible to request from the court that the meeting be held in a place other than the company’s registered address. The request for judicial notice must contain the necessary agenda of the day and without prejudice to the possibility of dealing with matters that the Company Act allows discussion, even if they are not included in the agenda.
It is recommended that the written application clearly indicate the people who must occupy the offices of President and Secretary of the Board, as the court may depart from the provisions in the company’s bylaws for the appointment of persons who are to hold these charges.
In addition, the shareholder requesting the judicial call may also request the assistance of a notary to take the minutes of the meeting. If the shareholder holds at least 5% in the SL, or 1% in the SA, the written request must contain a petition to the court for the appointment of a notary.
The file will be processed before the Commercial Court of the registered office and according to the rules of voluntary jurisdiction contained in the LEC. The company will be charged the call costs, if the applicant shareholder initially assumed the costs. However, there will be no imposition of costs on the file. In addition, the shareholder demanding judicial notice may request the assistance of a notary to take the minutes of the meeting. If the shareholder holds at least 5% in the SL, or 1% in the SA, the written request must contain a petition to the court for the appointment of a notary.
Carlos Hernández & Nicolás Melchior
This article is not considered as legal advice