The relationship between the owners (participants) of the company is very important for a successful business. Changes in the composition of participants can be very sensitive for the work and development of the company. A bona fide participant of the company can voluntarily withdraw from the number of owners at any time. It is possible to exclude an unscrupulous participant through the court.
Who can apply to the court to exclude an unscrupulous participant
Other members of the company may apply to the court with a request to exclude a participant. The shares of such participants together should not be less than 10% of the authorized capital of the company.
When participants can go to court
In each of the cases, it is possible to demand in court the exclusion of an unscrupulous participant from the list of participants:
- the participant grossly violates its obligations, with the exception of obligations under the agreement on the rights of the company’s participants, when such an agreement was concluded,
- the participant interferes with the work of the company by his actions (inaction).
For example, this may be expressed in the fact that a participant does not make an additional contribution to the authorized fund when the term and procedure for making contributions are provided for by the charter or by a decision of the general meeting of participants.
The facts of violations of an unscrupulous participant will need to be confirmed in court with documents and witness statements.
Consequences of exclusion of an unscrupulous participant
The participant is excluded from the ownership of the company from the moment the court decision on the exclusion of the participant comes into force.
The share of the excluded participant goes to the company itself.
The company pays the participant the value of his share and part of the company’s profit, which falls on his share. Part of the profit is calculated from the company’s funds received from the moment of exclusion of the participant until the moment of settlement with him. You can distribute the company’s assets instead of paying a portion of the profits. The moment of settlement with the excluded participant is the date of payment of the value of the share or the issue of property, determined by the decision of the general meeting of the company’s participants, adopted by a majority vote.
You can pay the cost of the share or transfer the property to the excluded participant after the approval of the report for the year in which the participant was excluded. The term of payment of the share or the issue of property is up to 12 months from the date of the decision on exclusion.
The company’s charter will need to be amended, since after the exclusion of a participant, the composition of the company’s owners changes and shares in the authorized capital can be redistributed.
How we can be useful in excluding an unscrupulous participant
Corporate relations is one of the specializations of our company. Our lawyers and attorneys speak English. We can:
- Give advice on ways to resolve the conflict with an unscrupulous participant of the company;
- Help you assess the violations committed by an unscrupulous participant;
- Prepare documents for the court, including a statement of claim;
- Represent your interests in court.
Contact us
If you have any questions or disputes about the exclusion of a shareholder from the company’s membership, we will be happy to help you! Our many years of experience in the field of corporate law will help you in resolving any disputes in this area.
Phone and email communication options are available for your convenience:
- +375291422719 (WhatsApp/Telegram/Viber);
- info@ambylegal.by.
