OLG Dresden: Representation or accompaniment at general meeting of shareholders

OLG Dresden: Representation or accompaniment at general meeting of shareholders

GmbH shareholders can be represented by a proxy at the general meeting of the shareholders. In addition, it may be permissible according to a ruling of the Oberlandesgericht (OLG) Dresden [Higher Regional Court of Dresden] for them to bring an adviser along to the meeting.

GRP Rainer Lawyers and Tax Advisors in Cologne, Berlin, Bonn, Düsseldorf, Frankfurt, Hamburg, Munich, Stuttgart and London conclude: The general meeting of the shareholders is the main decision-making body within a GmbH. Thus, the right to participate in this meeting represents one of the core rights of membership accorded to shareholders. This right can only be restricted under strict conditions. Furthermore, shareholders generally also have the right to be represented by proxy at the general meeting of the shareholders, unless otherwise stated in the articles of association.

This can, however, often give rise to disputes among the shareholders, particularly when resolutions to the detriment of a shareholder are prepared. The Oberlandesgericht Dresden had to rule on whether it is acceptable for a minority shareholder to be represented by his lawyer and whether he can bring him along as an advisor to the general meeting of the shareholders (Az.: 8 U 347/16).

In the instant case, the shareholders of a GmbH wished to arrive at a decision regarding the redemption of a minority shareholder“s shares as well as the latter“s exclusion. The OLG ruled that whether a shareholder has the right to vote or, as in the present case, is not entitled to vote, this does not affect his right to participate. It held that the right to participate guarantees him the right to be heard and comment on proposed resolutions. Additionally, it ensures that the shareholder is informed about the progress and content of the decision-making process. The Court went on to say that unless the articles of association provide otherwise, the shareholder can be represented by a proxy at the meeting and must issue his representative with a power of attorney for this to happen. Restrictions on the admission of a representative were said to be only permissible in the case of special circumstances or an important, objective justification.

The Court stated that if a shareholder personally attends the meeting, he is, as a matter of principle, not entitled to bring along an advisor, unless this stems from fiduciary duties in relation to the remaining shareholders. This might be the case if serious decisions need to be made and the shareholder lacks the relevant expertise or the shareholder“s legal status is directly concerned, e.g. due to his shares being redeemed.

Having said all of that, it is possible for important arrangements to be agreed in the shareholder agreement or articles of association. Lawyers who are experienced in the field of company law can advise accordingly.

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