What are the legal grounds for a partner’s right to withdraw due to lack of dividend distribution? Jurisdiction Spain.

Question from Sandra, What are the legal grounds for a partner’s right to withdraw due to lack of dividend distribution? Jurisdiction Spain.

Answer from AI:

In Spain, the legal grounds for a partner’s right to withdraw from a company due to the lack of dividend distribution are primarily governed by the Spanish Companies Act (Ley de Sociedades de Capital). This law outlines the rights and obligations of shareholders and partners in various types of companies, including limited liability companies (Sociedad de Responsabilidad Limitada, S.L.) and public limited companies (Sociedad Anónima, S.A.).

Key Provisions in the Spanish Companies Act

The Spanish Companies Act provides specific conditions under which a partner or shareholder can exercise their right to withdraw from the company. Here are the main points:

• Article 348 bis: This article specifically addresses the right of withdrawal due to the lack of dividend distribution. It states that shareholders have the right to withdraw from the company if the general meeting does not agree to distribute dividends of at least one-third of the legally distributable profits obtained during the previous fiscal year.
• Conditions: The right to withdraw can be exercised if:
  • The company has been in operation for at least five years.
  • The general meeting has not agreed to distribute dividends of at least one-third of the legally distributable profits.
• Procedure: The shareholder must notify the company of their intention to withdraw within one month from the date of the general meeting where the decision not to distribute dividends was made.

Steps to Exercise the Right of Withdrawal

If you are a shareholder considering withdrawal due to the lack of dividend distribution, here are the typical steps you should follow:

1. Review the Company’s Financial Statements: Ensure that the company has legally distributable profits and that the conditions for withdrawal are met.
2. Attend the General Meeting: Be present at the general meeting where the decision on dividend distribution is made.
3. Notification: If the general meeting decides not to distribute the required dividends, notify the company of your intention to withdraw within one month.
4. Valuation of Shares: The company will need to determine the value of your shares. This process may involve an independent expert if there is a disagreement on the valuation.
5. Payment: Once the value of your shares is agreed upon, the company must pay you the corresponding amount.

Legal Advice and Resources

While the Spanish Companies Act provides a clear framework for the right of withdrawal, the process can be complex, and specific circumstances may vary. It is advisable to consult with a legal professional to ensure that your rights are protected and that you follow the correct procedures.

Useful Resources

For more detailed information, you can refer to the following resources:

• Spanish Companies Act (Ley de Sociedades de Capital)
• Institute of Chartered Accountants of Spain (ICJCE)

Remember, this information is intended to provide a general understanding of the legal grounds for withdrawal due to lack of dividend distribution in Spain. For personalized advice, always consult with a qualified legal professional.