One of the most significant changes concerns restrictions on the transfer of shares. Under the current legislation, only redemption and consent clauses may be included in the articles of association, whilst a pre-emptive right needs to be agreed upon in a shareholders’ agreement.<\/p>\n
In future, a pre-emptive rights clause could be included directly in the articles of association. Thus, a shareholder or the company itself would have the right to acquire the shares that are being sold before the external purchaser. The articles of association would specify, within the limits permitted by law, the detailed terms of the clause, such as the persons entitled to the pre-emptive right and the determination of the price.<\/p>\n
This would be a significant change, as a pre-emptive right based on the articles of association would be binding on all shareholders and would also be relevant to subsequent transferees.<\/p>\n
In future, it would no longer be mandatory to resolve on the board of directors\u2019 discharge from liability at each annual general meeting. However, the matter would still have to be dealt with if the articles of association so require or if a shareholder, the board of directors or an individual member of the board of directors proposes it.<\/p>\n
This change is significant in terms of the management\u2019s liability. In principle, granting the discharge of liability limits the company\u2019s right to subsequently bring claims for damages in respect of matters of which the general meeting was aware at the time the discharge from liability was resolved. If discharge from liability is no longer granted as a matter of routine, the management\u2019s actions will be more broadly open to subsequent scrutiny, and the possibility of bringing claims for damages will remain. The amendment may therefore emphasise compliance with the management\u2019s duty of care as well as the proper documentation of decision-making. In companies that wish that the discharge from liability should continue to provide the management with the associated protection, the consideration of discharge from liability should therefore be retained in the articles of association as a mandatory item of the general meeting\u2019s agenda.<\/p>\n
It is proposed that the regulations concerning special audits would be extended so that the audit could be directed not only at the company but also at one or more subsidiaries. This change is particularly significant in group structures where business operations and assets are spread across several companies.<\/p>\n
Furthermore, the company\u2019s management would be subject to an explicit obligation to assist the auditor and to provide the information and documents required by the auditor. A breach of this obligation would be punishable as a company law violation. The amendments would, in particular, strengthen the ability of minority shareholders to investigate the company\u2019s operations in unclear situations.<\/p>\n
It is proposed that the maximum duration of the authorisation to acquire own shares \u2013 that is, the authorisation granted by the general meeting to the board of directors \u2013 would be extended from 18 months to five years. Furthermore, the current one-tenth maximum limit applicable to public limited companies and their subsidiaries would be removed.<\/p>\n
These changes would provide greater flexibility in utilising the company\u2019s own shares, for example, as part of corporate restructuring and staff remuneration, and would reduce the administrative burden arising from the repeated renewal of authorisations.<\/p>\n
One of the most significant changes concerns the prohibition on financing. At present, subject to a few exceptions, a company is not permitted to grant a loan, provide funds or offer security for the purpose of enabling an external party to acquire shares in the company or its parent company.<\/p>\n
Under the proposal, the prohibition would apply only to public limited companies in future. A private limited company could thus, for example, finance a new shareholder\u2019s share purchase with a loan or security. This change could facilitate, in particular, generational transfers, the organisation of management shareholdings and the retention of key personnel.<\/p>\n
As a result of the change, private limited companies would have a broader right to use their own funds and collateral to support share purchases, which would increase the availability and flexibility of financing particularly in the SME sector. In public limited companies, the prohibition on financing would remain unchanged, which is in line with EU regulations and reflects the broader shareholder base of public companies and the need for market protection.<\/p>\n
It is also proposed that the formalities relating to the incorporation of a company and share issues would be simplified.<\/p>\n
In future, the subscription price of shares would, as a general rule, be allocated to the reserve for invested unrestricted equity, unless otherwise stipulated in the memorandum of association, the resolution on the share issue or the articles of association, or unless otherwise provided for in the Accounting Act. At present, the default practice is to allocate the subscription price to share capital, although the reserve for invested unrestricted equity is widely used for this purpose. This amendment would bring the wording of the Limited Liability Companies Act into line with current practice.<\/p>\n
The requirements for auditors\u2019 certificates and statements in private limited companies would be reduced. An auditor\u2019s certificate confirming the payment of shares would, in future, be mandatory only for public limited companies. Furthermore, assets contributed in kind up to a maximum of 8,000 euros would be exempt from the mandatory auditor\u2019s statement in a private limited company.<\/p>\n
With regard to the winding up of business operations, a private limited company could also apply to be removed the register once its debts have been settled and a unanimous decision has been reached on the distribution of the remaining assets. In such cases, there would be no need for a cumbersome liquidation procedure or a public summons. Even if the procedure were simplified, the position of the creditors would still be safeguarded in future, as under the simplified procedure, those who received assets from a company removed from the register would be liable, to the extent of the assets they received, for the payment of the company\u2019s debts insofar as the distributed assets exceed the distributable assets.<\/p>\n
The proposal also includes a number of more technical amendments. As for the creditor protection, \u00a0the period of public notice would be shortened from three months to six weeks, and the deadline for submitting notifications to known creditors would be reduced from one month to three weeks. The obligation to prepare consolidated financial statements would be based solely on the Accounting Act in future. The provisions concerning entries in the shareholder register would be clarified.<\/p>\n
The limitation of actions rules governing the liability for damages of the auditor and the management would also be harmonised. The board\u2019s obligation to report the loss of equity to the Trade Register would, in turn, be clarified. Instead of the current reference to the loss of share capital, the regulations would henceforth refer to the loss of equity, and
\na reasonable maximum time limit would be set for such notification. The change would be largely technical and would clarify the current practice.<\/p>\n
The common aim of the proposals is to reduce the administrative burden and increase the companies\u2019 operational flexibility. In practice, the changes would particularly affect the ownership and financing arrangements of unlisted companies, as well as the position of minority shareholders.<\/p>\n
A comprehensive package of amendments to the Limited Liability Companies Act is proposed by a government proposal (HE 126\/2026 vp), which aims to reduce the administrative burden on companies and, in particular, to improve the operating conditions for small and medium-sized enterprises (SMEs). The amendments are intended to enter into force on 1 July 2027. […]<\/p>\n","protected":false},"author":11,"featured_media":2445,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[45],"tags":[835,834,833],"class_list":["post-8436","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-insight","tag-amendments-to-the-limited-liability-companies-act","tag-changes-to-limited-liability-companies-act","tag-limited-liability-companies-act"],"acf":[],"yoast_head":"\n