The right of withdrawal is a protective mechanism for minority shareholders in a limited liability company, as it guarantees their right to voluntarily terminate their relationship with the company. This is always subject to certain circumstances.

In a capital company, several partners pool money and other assets in order to carry out a business activity and make a profit from it. Corporations, limited liability companies and limited joint-stock companies belong to this group of companies.

When a partner has the right to separate

Article 346 of the Capital Companies Act establishes that shareholders have the right of separation when any of the following causes occur:

When the company changes the activity it engages in

If there is a substancial change or replacement of the object of the company, the partners who do not agree have the right to separte. A number of additional conditions must be met for this:

  • A shareholder who wishes to exercise his right of separation must not have signed the agreements determining the grounds for separation.
  • The changes must have been published in the Official Gazette of the Commercial Register or communicated in writing to each member who did not vote in favour of the resolution.
  • From the date of publication or receipt of the communication of the new resolution, the shareholder who wishes to exercise his right of withdrawal has a period of thirty days in which to request it.

When there are conflicts with the distribution of dividends

The distribution of dividends is often a source of disagreement between shareholders. The right of withdrawal arises if at least 25% of the profits for the last five years have not been distributed. The shareholder must record his disagreement in the minutes and exercise his right of withdrawal within one month from the date of the meeting.

The idea is that, although it is up to the general meeting to decide on the distribution of dividends, the dissenting minority shareholder can assert his will with the separation and subsequent redemption of his holdings or shares.

There are, however, exceptions to this assumption:

  • Companies in insolvency or pre-insolvency proceedings.
  • Sports limited.
  • Listed companies on trading systems.
  • Companies that have reached refinancing agreements.

When the company is extended beyond its expiry date or when a dissolved company is reactivated

Many limited partnerships have an expiry date, at which point they cease to exist. If it is decided to extend the partnership beyond that time, dissenting partners have the right to separate.

Similarly, in the case of a dissolved partnership that is reactivated, partners who do not agree may leave the partnership

When ancillary services are required 

A change in the conditions of social benefits is also a valid reason for separation.

According to the conditions laid down in the statutes

In addition to the provisions of the Capital Companies Act, each company is governed by its own articles of association. These may provide for grounds for termination of membership, the form of proof of such grounds and the procedure and deadline for enforcing them.

The redemption of the separating partner’s shares

When a shareholder leaves the company, he is entitled to receive a refund for his shares. If no agreement on the fair value of these shares is reached between the partners, an external auditor appointed by the Commercial Register is called in at the request of the company or any of the partners.


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