Shareholder disputes

Shareholders frequently clash with one another in practice, and the subsequent impossible situation between them often results in considerable damage to the company and its continuity. In such cases, decision-making, business operations and collaboration may come under pressure or may even become impossible. At worst, decision-making may even be at stalemate. This situation could occur in a fifty-fifty ratio between shareholders, and is also known as “deadlock”.

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What we can do for you

Dispute settlement rules

One option would be for you to record dispute settlement rules as a precautionary measure, which can be followed in the event of conflict. You can have these rules included in your company’s Articles of Association or in a shareholders’ agreement. With respect to the latter option, this enables shareholders to determine their own mode of action to some extent in certain conflicts. A shareholders’ agreement could include an obligation to offer, for example, or it could establish the way in which the purchase price for shares should be determined. Another option is to insert a stipulation in this agreement stating that the dispute must be resolved by a binding opinion or arbitration instead of the regular court.

Legal proceedings

If you are confronted with a shareholder dispute and no provision for this has been made in the Articles of Association or a shareholders’ agreement, specialised or non-specialised legal proceedings are often the right way to resolve this, such as one of the following.

  • Inquiry proceedings conducted at the Enterprise Section of the Court of Appeal in Amsterdam, concerning differences of opinion between shareholders and directors on the policy to be pursued at a certain company;
  • statutory dispute settlement rules providing for an enforced sell-out (disengagement) or sale (squeeze-out) of shares;
  • division following a dispute, intended to allow each of the wrangling shareholders in a private or public limited company to acquire part of the aforesaid company;
  • buy-out scheme in which a majority shareholder can buy shares belonging to a – possibly recalcitrant – minority shareholder, or a minority shareholder can force the majority shareholder to sell out.

Ploum can provide you with legal assistance

At Ploum, our specialists have extensive experience in advising our clients on shareholders’ agreements and in drawing up such agreements, and we will be happy to help you in this respect. If you, as a shareholder, are confronted with a dispute or an imminent dispute, we will assist you in settling it. We can do this through the dispute settlement rules included in the Articles of Association or the shareholders’ agreement, or through legal proceedings. Our working method is practical, fast and effective with a favorable price-quality ratio, and we also know exactly how to deal with the media in publicity-sensitive matters.