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Chairman or the Board of Directors? Who convenes the Meeting?

Does the Chairman himself represent the Board of Directors? Can he/she call a General Meeting? Is a resolution of the Board necessary? Can the Meeting be called by the directors whose position is not registered? What happens if the position is overdue but not expired? What happens if the formalities described above are not complied with?
Failure to comply with the legal requirements for the call will render the General Meeting null and void.

The Chairman or the Board of Directors? Who calls the Meeting?

Whenever the General Meeting is not “universal”, i.e., when not one hundred percent of the share capital is present and everyone agrees to hold the Universal Meeting, the meeting must be called in advance. The call must comply with the formalities imposed by the regulations and the Company’s bylaws in order to be valid.

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Power to call a General Meeting

The Law establishes that the General Meeting must be called by the directors or liquidators, where appropriate, of the company. The power to call the General Meeting is legally reserved to the administrative body on a exclusive basis. This power must be exercised in accordance with the structure corresponding to the administrative body of each company. Depending on the case, it will correspond to the sole administrator, to one of the joint administrators, to all the joint administrators or to the Board of directors.

The Board shall be convened whenever the directors deemed it necessary to satisfy the corporate interests. Shareholders of limited liability companies representing at least 5% of the share capital may request a meeting to be called. In the latter case, the directors are obliged to comply with the shareholders’ demands.

The calling of the Meeting by the Board of Directors.

The Supreme Court understands that the power or duty to call the General Meetings of the Company corresponds to the Board of Directors. It is possible to delegate to the Presidente the announcement of the call but not the call itself. This is because the representation of the Board of Directors does not intrinsically correspond to the Chairman. The power of representation corresponds to the Board itself, which acts collegially.

In short, the Chairman could sign the notice of the meeting, stating the position that corresponds to him. In other words, the Chairman may execute the resolution of the Board of Directors stating that the meeting is convened by virtue of the aforementioned resolution.

Formalities to be fulfilled by the call

There must be a resolution of the Board of Directors that decides to call the Meeting with all the necessary requirements for the resolutions to be valid. The minutes of the Board of Directors must indicate the essential aspects of the call, such as the date and the subjects to be dealt with at the meeting.

Can the administrators whose position is not registered call the Meeting?

Yes, the appointment becomes effective upon acceptance, even if it has not been registered in the Mercantile Registry.

Can the director with an expired position convene the Meeting?

The Supreme Court admits this possibility. However, they may only convene the Meeting to proceed with the appointment of new administrators, not to adopt other resolutions.

What if the position is overdue  but not expired?

The administrators may convene the meeting if the term for approving the accounts has not expired or if no other meeting has been held. In this case, the agenda may include any matter, i.e., it is not limited to the appointment of a new director.

What happens if the foregoing formalities are not complied with?

If the notice of meeting does not comply with the legal requirements, the general meeting will be null and void. The reason behind this is that the power to call the meeting is a non-delegable power of the administrative body. Infringement of the rules governing the formalities to be fulfilled by the notice of meeting affects the totality of the resolutions adopted. At this point we must highlight the limitations to the challenge of corporate resolutions for purely formal matters.

If this article has been of interest, we also suggest you to read the following article published on our website: Quorum and legal majorities in General Meeting and Board of Directors.

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