Which pre-emptive rights are still permissible in articles of association?

Shareholders want to keep to themselves and, moreover, they want to make sure that if a shareholder resigns no unwanted third party can replace him. Therefore, pre-emption clauses are often incorporated in articles of association.

Pre-emptive rights give shareholders the right to buy another shareholder’s share if certain conditions occur, for example, a shareholder’s insolvency. Such pre-emptive right clauses are common practice; under no circumstances should an unwanted third party enter the company through a sale in bankruptcy. The underlying aim of pre-emption clauses is to prevent that an insolvency administrator sells the insolvent shareholder’s share by auction whereby third parties become (co)shareholders of the GmbH. The Supreme Court of Justice (6 Ob 64/20k) has finally made it clear that pre-emptive rights on shares in the case of a shareholder’s insolvency are legal. However, the amount of severance payment must not be indecent. In a further ruling, the Supreme Court of Justice (6 Ob 96/20) ruled that a discount of 20 % is appropriate (“reasonable compensation”).

However, it is now unclear what effects these two recent Supreme Court rulings will have on various case constellations of pre-emptive rights. For example, it remains uncertain whether it is allowed that pre-emptive rights are costless in the event of a shareholder’s death. Which price gradations are still possible and permissible for which case constellation?

In view of the above-mentioned Supreme Court rulings, it is advisable to subject existing provisions in the articles of association to a (critical) review. If market value deductions are provided, these must be designed in such a way that they are also regulated in the same way in comparable cases. In addition, the amount of the deductions should be kept to an extent that can still be regarded as appropriate.

 

31. March 2021

 

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