What Can I Do If a Board Resolution Removes My Shareholder Rights?

Company Management, Representation and General Meetings

Prepared by: Constantinople

Not every resolution of a joint stock company's board may be challenged through an annulment action in the same way as a general meeting resolution. The law provides specifically for nullity of resolutions contrary to the principle of equal treatment, the company's fundamental structure or indispensable shareholder rights. The content of the resolution, source of authority and effect on you must first be identified correctly.

Prepare the complete resolution, articles of association, relevant general meeting resolutions and correspondence showing implementation. For example, abolishing a shareholder's information rights entirely differs from refusing a request for a particular document. If the resolution was not sent to you, record the document through which you learned of its date and content. A definitive conclusion cannot be based solely on hearsay about management.

Special litigation rules, such as those for certain decisions under the registered capital system, are checked separately. It is therefore risky to postpone all time-limited applications in reliance on an allegation of nullity. Lack of authority of the deciding body, procedural defects and the transaction's relationship with third parties may have different legal consequences. Challenging an internal corporate resolution does not automatically eliminate every external contract.

Prepare the complete board resolution and documents showing implementation. The nature of the resolution, special litigation deadlines and need for interim protection are assessed separately.

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