Dividend collection

You are a partner in a company that usually makes profits. However, when it comes to approving the accounts, the majority shareholders have always wanted to allocate them to reserves.

Well, in these cases, the law allows a partner to challenge a Board resolution if it is imposed abusively by the majority. Therefore, this agreement not to distribute dividends when the company is profitable can be challenged for this reason.

It is irrelevant if in previous financial years you did not object to the profits being allocated to reserves, as you can object at any time. In this regard, please note that:

• If the financial year ends on December 31, the administrator has until March 31 to prepare the annual accounts and propose the allocation of profits. Therefore, speak to the partners beforehand and try to persuade them to distribute dividends this year.

• If this is not possible, vote against it at the shareholders' meeting where the allocation of profits to reserves is proposed. If the agreement is ultimately approved, analyze both the approved accounts and those of previous years, and if the company's financial situation is healthy and there is no need to allocate profits to reserves, consider challenging the agreement as abusive.

• If the court deems the agreement abusive, it will annul it and compel the administrator to convene another meeting to agree on the distribution of profits.

 

Our professionals will help you negotiate the collection of your dividend and, if necessary, advise you on initiating the corresponding legal actions to claim it.