Corporate

There is no single right answer, but a few differences are decisive. In a limited liability company, a share transfer requires a notarised agreement and the approval of the general assembly, and partners can be held liable for the company's unpaid public debts in proportion to their shares. In a joint stock company, shares are transferred more easily and different share classes and privileges can be structured more flexibly; this is why it is generally better suited to companies planning to raise investment or grow with many shareholders.

It is not mandatory, but the articles of association do not cover everything. The articles are registered with the trade registry, publicly available and limited in content by law. A shareholders' agreement allows matters such as transfer restrictions, tag-along rights, exit scenarios and deadlocks to be regulated confidentially and flexibly, but it binds only its parties. In a well-built structure the two complement each other.

The ordinary general assembly must meet within three months of the end of each financial year; resolutions such as approving the financial statements, releasing the board and distributing profit are adopted there. Failing to hold the meeting with a proper call and agenda opens the door to claims that the resolutions are voidable or null. Missing the deadlines for registering and announcing resolutions that require it creates a separate problem.

Resolutions that breach the law, the articles of association or the principle of good faith can be challenged by an action for annulment. The action must be filed within three months of the resolution and, as a rule, can be brought by a shareholder who voted against it at the meeting and had this recorded in the minutes. If a resolution you intend to challenge is on the agenda, attend the meeting prepared so as not to lose that right.

Approval is mandatory where the parties' turnovers exceed the thresholds set by the Competition Authority, which are updated from time to time. A transaction subject to approval that is completed without it does not become legally valid and also carries the risk of a fine. Because a special rule applies to acquisitions of technology companies, even the acquisition of what looks like a small start-up may require notification.