LEADELL Newsletter: Contesting the decision of the company shareholders in the Baltics
How to contest a decision of the shareholders of a capital company in the Baltic States?
As the tense economic and political situation unavoidably influences the business environment, the number of disputes surrounding decisions of shareholders’ meetings of limited liability companies and joint stock companies (hereinafter – capital companies, companies) is continually increasing. In response to the changes, the best solutions are sought, which frequently result in a fertile climate for disagreements when the opinions collide.
Disputes frequently arise in connection with important decisions such as company management, profit sharing, reorganization, and so on. In light of this, and to help understand the regulation, in this edition experts of the LEADELL law offices delve into and compare the methods for contesting the decisions, incl. the basis for contesting, who can bring a claim, and the procedure among all three Baltic States. As the regulation of this legal resort has not been unified within the European Union, the procedure for contesting differs among the member states. We invite you to get acquainted with the comparative report prepared by the LEADELL law offices on the most significant aspects of contesting the decisions of a capital company’s shareholders.
The basis for contesting shareholders’ decision
The regulation providing for the right to contest a decision of the shareholders is similar in nature in all three countries. The decision can be contested in cases where it is contrary to a) the law, b) good morals, c) the articles of association, d) public interests, e) purposes of the company, f) significant violations were committed in convening the meeting of shareholders or in the decision-making procedure, or g) violates the rights of third parties such as creditors.
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