NETHERLANDS Law and Practice Contributed by: Bastiaan Cornelisse, Bastiaan Kemp, Michel van Agt and Philippe Hezer, Loyens & Loeff
at least 3% of the issued capital and they substan- tiate the request. The request must be received by the company no later than 60 days before the meeting. It follows from Supreme Court case law that share- holder proposals related to matters that fall outside the remit of the general meeting may be either rejected or tabled as discussion items only. 2.11 Challenging a Resolution Shareholders may challenge shareholder resolutions in two proceedings: • any interested party, including each shareholder, can bring an action before the competent court to annul a resolution that is contrary to reasonable- ness and fairness or if procedural standards have not been met; and • shareholder resolutions can also be annulled by means of a final measure if mismanagement is established in inquiry proceedings before the Enterprise Chamber of the Amsterdam Court of Appeal (a specialised business court) – see 10.1 Remedies Against the Company . Pending actions to challenge resolutions, sharehold- ers may also seek injunctive relief to either prohibit the implementation of a given resolution or suspend the decision-making process itself. 2.12 Institutional Shareholder Groups Institutional and other large shareholder groups have various means to exert their influence over a company and monitor their investment. It is common for such investors to have bilateral contacts with company management and close contacts with the investor relations department. Their involvement with compa- nies can lend them soft control, further bolstered by their shareholder rights. There has been discussion on whether institutional investors should take on a stewardship role in their portfolio companies. This is indicative of the credibility attributed to institutional investors and the influence they can exert. There have been cases where insti- tutional investors have taken an activist approach or
supported certain activist action, resulting in obtaining significant leverage over management. 2.13 Holding Through a Nominee Trades in shares of listed Dutch companies are typical- ly settled in book-entry form via a securities account kept by an intermediary. For this, Dutch law acts on the presumption that the underlying (beneficial) share- holders exercise their rights through the intermediary. Shareholders may also appoint authorised repre- sentatives to attend a shareholders’ meeting on their behalf. In principle, such representative may exercise all shareholder rights at that meeting, including voting rights and the right to ask questions. 2.14 Written Resolutions Dutch law allows written shareholder resolutions to be adopted without holding a meeting. In the case of a BV, this requires that all persons with meeting rights consented to such decision-making without holding a meeting. In the case of an NV, it requires a unanimous vote by all shareholders, provided that: • the NV’s articles of association allow for written resolutions; and • no bearer shares or depositary receipts for shares have been issued. For both the BV and the NV, votes shall be cast in writ- ing and may be cast electronically, unless the articles provide otherwise. 3. Share Issues, Share Transfers and Disclosure of Shareholders’ Interests 3.1 Share Issues Subject to certain exceptions, Dutch law stipulates that all shareholders have pre-emptive rights as to any issue of shares pro rata to the aggregate amount of the nominal value of shares held by the shareholder. Notable exceptions include the issuance of preference shares and shares under an employee share option programme. Pre-emptive rights can also be excluded in certain cases.
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