From the tyranny of the controlling shareholder to the tyranny of the minority partner

From the tyranny of the controlling shareholder to the tyranny of the minority partner

Abstract:

Closely-held companies constitute an essential part of the business sector in Spain. Traditionally the minority shareholders have been subject to expropriation by the controlling shareholders, seeing their right to a return on their investment (dividend) diminished. By bringing into force the Article 384 bis of the Spanish Capital Company Law in January 2017 this situation seems to end.

This paper does a study of the article analyzing the most significant strengths and weaknesses and suggesting some possible actions for the future. The most relevant conclusion is the one deduced from the paper´s title when observing a law of the pendulum that will require future adjustments in the norm.

Keywords: Right of separation; Dividends payment; Profit distribution, Expropriation.