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The main rights of the shareholder of a Greek S.A. company

Iason Skouzos - TaxLaw > Practice Areas  > Commercial Law  > The main rights of the shareholder of a Greek S.A. company

The main rights of the shareholder of a Greek S.A. company

Many of the shareholders’ rights are usually mentioned in the articles of association of an S.A., provided of course that these are not the standard articles of association, which only contain the minimum content required by law. The articles of association, which is an agreement between shareholders, often also serves as a user manual for the meetings and decisions of the general meeting and the board of directors of an SA.

After the repeal of Law 2190/1920 and the entry into force from 01.01.2029 of the most recent law on S.A., Law 4548/2018, many S.A. have not yet harmonized their statutes with the new law, since this harmonization is not mandatory. However, If the statutes have not been harmonized, the law prevails.

Taking into account this reality, we list the main rights of a shareholder of an unlisted public limited company, as they arise from the new legislation (Law 4548/2018).

a/a Required percentage Type of right Related provision Ν.4548/18
1 1 share Voting rights at the General Meeting ar. 36
2 1 share Right to participate in the General Meeting by proxy, with legal authorization ar 128 par. 1
3 1 share Pre-emptive right to the entire new capital or the bond loan, depending on the participation in the existing share capital, in the case of an increase in share capital that is not made by means of a contribution in kind or in the case of an issue of bonds with the right to be converted into shares ar 26
4 5% (1/20) Right to convene an extraordinary general meeting of shareholders (upon request submitted to the Chairman of the Board of Directors and containing the agenda item).

If the General Meeting is not convened within 20 days from the service of the relevant request, the meeting is convened by a court decision (interim measures procedure), which is not subject to appeal.

ar 141 par. 1
5 5% (1/20) Right to add items to the agenda of a previously convened General Meeting (by request to the Board at least 15 days before the GM. The Board must publish/announce the additional items at least 7 days before the GM. If the BoD fails to do so then the requesting shareholders have the right to request a postponement of the GM and to publish the new agenda themselves ar 141 par. 2
6 5% (1/20) Right to postpone the GM only once (the chairman of the GM is obliged to postpone only once the adoption of decisions by the GM on all or certain matters, setting the day for the continuation of the meeting as the day specified in the shareholders’ request.

Note: the date of continuation of the meeting, according to Law 2190/1920, cannot be more than 30 days from the date of adjournment, while according to Law 4548/2018 it cannot be more than 20 days from the date of adjournment.

ar 141 par. 5
7 1 share Right to receive specific information from the Board of Directors on the company’s affairs to the extent that such information is useful for the effective assessment of the items on the agenda of the GM (by request to the Board of Directors at least 5 full days before the GM) ar.141 par. 6 para. 1
8 5% (1/20) In the context of the annual General Meeting, the right to be informed of the amounts paid in the last two years to each member of the Board of Directors or the directors of the company, as well as any benefit paid to these persons from any cause or contract of the company with them (by request to the Board of Directors)

The 2 above (rights 7 & 8) the BoD may deny them “for a compelling material reason”, which is stated in the minutes, e.g. because the shareholder participates in the BoD and already knows this information.

ar 141 par. 6, para. 2
9 10% (1/10) Right to receive information at the GM on the progress of the company’s affairs and assets (by request to the Board of Directors at least 5 full days before the GM)

[According to Art 141 par. 13, it is provided that the statutes may reduce by up to half the percentages required for the exercise of the minority rights under Article 141]

Here too, the Board may refuse for an overriding substantial reason stated in the minutes.

If the validity of the justification for any refusal by the Board of Directors to provide the information in the above cases is questioned, the shareholder may appeal to court (through the injunction procedure) and the court may order the company (the Board of Directors) to provide the information that was refused.

ar. 141 par. 7
10 5% (1/20) Right to decide on any GM item by roll call/open vote (by request at the meeting) ar 141 par. 6 para. 9
11 1 share The right to be informed of the amount of the company’s capital, the classes of shares issued and the number of shares of each class, in particular preference shares, with the rights conferred by each class, as well as of any blocked shares, both in terms of their number and the restrictions provided for. An application to the Board of Directors is required at any time. The shareholder is also entitled to be informed how many and what kind of shares he/she holds, as shown in the shareholders’ register. ar 141 par. 10
12 5% (1/20) Right to request an extraordinary audit of the company by the court. The court orders the audit if acts are suspected to violate provisions of laws or the articles of association or resolutions of the general meeting. The request for an audit must be submitted within 3 years of the approval of the financial statements for the financial year in which the alleged acts were committed. ar 142 par. 1
13 20% (1/5) The right to request the court to audit the company if, from the whole course of the company and on the basis of specific indications, it becomes credible that the management of the company’s affairs is not being conducted as required by sound and prudent management. ar 142 par. 3
14 1 share The right to receive (and – under the new law the company is obliged to communicate – unless it posts them on the internet – 10 days before the annual General Meeting) the annual financial statements, the management report of the Board of Directors and the auditors’ report. ar 123 par. 1
15  1 share The right to ask the Chairman of the General Meeting – at the meeting – to have his/her opinion recorded in the minutes of the General Meeting, provided it concerns an item on the agenda. ar 134 par. 1
16 1 share The right to receive a copy of the Minutes of the General Meeting, upon request.
If the company refuses to provide a copy, then,
a) if the shareholder attended (in person or by proxy) the General Meeting, the shareholder shall address the GEMI (Company’s Registry), which is obliged to provide him/her with a copy.
b) if the shareholder did not attend (in person or by proxy) the General Meeting, and the GEMI refuses to provide him/her with a copy, he/she shall request the GEMI to provide it by public prosecutor’s order
ar 134 par. 2
17 1 share Right to oppose the holding of a General Meeting and the adoption of resolutions, in case shareholders representing 100% of the shares are present, but no notice of a General Meeting has been legally published ar 120 par. 5
18 1 share The right to oppose the discussion and adoption of a decision on an item on the agenda which is not included in the legally published Notice of the General Meeting (this right applies to a General Meeting where 100% of the share capital is present, otherwise the discussion and adoption of a decision is not possible)
19 1 share The right to oppose the convention of  General Meeting and the adoption of a decision when the General Meeting is held at a place other than that provided for in the Statutes. ar 120 par. 2
20 1 share Right to oppose the adoption of a GM decision by circulation of the minutes without a meeting ar 136
21  20% (1 /5) Right to oppose decisions of the General Meeting taken without a physical meeting. (New procedure, which should in principle be provided for in the statutes) ar 135
22 1 share Right to request the company to send him/her by e-mail individual information about upcoming general meetings at least ten (10) days before the date of the meeting. ar 120 par. 4
23 2% The right to oppose a decision of the General Meeting taken in a manner that is not in accordance with the law or the Articles of Association, by bringing an action for annulment before the court, if the shareholder did not attend the General Meeting or opposed the decision ar 137(3)
24 1 share In the event that the General Meeting has not been convened or the content of its decision is contrary to the law or the Articles of Association, the decision is null and void. The nullity may be challenged by any person, shareholder or third party, who has a legitimate interest either (a) by an action before the Court of Justice for recognition of the nullity of the resolution or (b) by a special extrajudicial declaration addressed to the company. ar 138(4)
25 1 share The right to redeem the shares from the company (by a court action), if for specific reasons* provided by law, the shareholder’s remaining in the company becomes, in an obvious way, particularly unprofitable, provided that the shareholder requesting the redemption attended the AGM and opposed the decision (unless the reason for the redemption is not related to such a decision)
* Reasons for takeover: a) The General Meeting resolved to transfer the registered seat of the company to another country, b) The General Meeting decided to introduce restrictions on the transfer of shares or to change the purpose of the company, c) Other cases that the Articles of Association may provide for.
The action for redemption shall be brought within 3 months from the execution of the amendment of the statutes, or in paragraph c, within the period provided for in the statutes.
ar 45
26 5% (1/20) Within 10 days from the publication of the announcement of the Board’s granting of authorization for the company’s contracts with related parties, shareholders representing 1/20 of the capital have the right to request a General Meeting to decide on the issue of granting authorization for the company’s contracts with related parties. ar 100, par. 3
27 5% (1/20) If by the time the General Meeting grants permission, the company has already concluded a contract with the related parties (contract of article 99 paragraph 1 of Law 4548/18) or the guarantee or security has been provided, then the granting of permission by the General Meeting is cancelled if a shareholder(s) representing one twentieth (1/20) of the capital represented at the meeting opposes it. ar 100, par. 4
28 5% (1/20) Right to submit a written request to the Board of Directors for the company’s claims against a Board member(s) under Article 103 (with reference to the facts establishing the liability of the Board member(s) and the damage suffered by the company as a result of an act or omission constituting a breach of the duties of the Board member(s)) ar 104
29 (the majority of those who submitted the above application) Right to apply to the Single Member Court of First Instance for the appointment of a special representative to bring an action by the company against the members of the Board of Directors, if the above application to the Board of Directors is rejected or the action is not brought within a certain time limit ar 105
30 5% (1/20) A remuneration or benefit paid or decided or approved by the General Meeting to be paid* to a particular member of the Board of Directors may be reduced by the court if it is deemed excessive and shareholders representing 1/10 of the capital have opposed this decision. The application to the court shall be submitted within 2 months of the decision of the AGM approving the remuneration/benefit and shall be submitted by shareholders representing 1/20th of the capital who opposed this decision. (That is, 1/10 of the capital is required to vote against the resolution, and – of those who voted against – 1/20 of the total capital is required to file the petition.
* This right does not apply to remuneration derived from a contract of employment, project or mandate
ar 109
31 1 share Right to apply to the Court (Single Member Court of First Instance) for the dissolution of the company if the company has not submitted for registration financial statements for at least 2 consecutive financial years, approved by the General Meeting.
The court shall, before taking its decision, allow the company a period of 2 to 4 months to remove the grounds for dissolution, unless it reasonably considers that this measure is unnecessary.
ar 165
32 1/3 The right to apply to the court (Single Member Court of First Instance – voluntary jurisdiction) for the dissolution of the company, if there is an important reason which, in an obvious and permanent way, makes the continuation of the company impossible (e.g., if, due to equal shareholdings in the company, the election of the Board of Directors is impossible, or the company cannot function).
The court shall, before giving its decision, allow the company and the shareholders a period of 2 to 4 months to remove the grounds for dissolution, in particular by means of a share buy-back between shareholders, unless it reasonably considers that this measure is unnecessary.
ar 166 par. 1- 4
33 1/3 In the event of an action for the dissolution of the company under Article 166, other shareholders representing at least 1/3 of the capital may intervene in the relevant proceedings and request the acquisition by them of all the shares of the applicant or applicants. ar 165 par. 5
34 10,00% (1/10) The right to apply to the court (voluntary procedure) which may order the omission or the interruption of the liquidation stage and the immediate deletion of the company from the G.E.M.I., if the company’s assets are not expected to be sufficient to cover the costs of the liquidation. ar 167
35 5,00% (1/20) If the liquidation exceeds 3 years, the liquidator is required to submit to the General Meeting a plan to accelerate and complete the liquidation. If the plan is not approved, the liquidator or shareholders representing one twentieth (1/20) of the paid-up capital may request the approval of the acceleration plan or the appointment of other appropriate measures by the Single Judge Court of First Instance. ar 169

* The information is accurate to the best of our knowledge as at the time of writing. We have no obligation to update it. We accept no responsibility against any third party who is not a client of the firm and has not signed the terms of our engagement.

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