CYPRUS Law and Practice Contributed by: George Middleton, Christoforos Iosif and Michalis Kramvis, Chryssafinis & Polyviou LLC
• placing the company under voluntary liquidation (75%); • approving a scheme of arrangement (50%+1); • increasing the company’s authorised share capital (50%+1); • the consolidation or sub-division of shares (50% +1); and • the removal of a director other than as may be pro- vided in the company’s articles (50%+1). For public companies, additional requirements apply with respect to resolutions resulting in a change of the amount or the classes of a company’s share capital or the rights attached to any class of shares. 2.9 Voting Requirements The usual method of voting is by a show of hands, unless the chair of the meeting or shareholders rep- resenting a set shareholding percentage request that voting is carried out by poll. Shareholders are normally entitled to appoint a proxy for the purposes of their representation/voting at a general meeting. There is no restriction on the use of weighted voting rights, so the articles of association of a company may attach weighted voting rights to a particular class of shares. Shareholders can cast votes electronically, to the extent that this is provided for in the articles of asso- ciation of the company. 2.10 Shareholders’ Rights Relating to the Business of a Meeting Apart from the right of shareholders holding not less than 10% of the shares comprising the company’s paid-up capital to request the calling of a meeting or to call a meeting themselves (see 2.3 Procedure and Criteria for Calling a General Meeting ), a company is obliged, upon the request in writing of shareholders holding not less than 5% of the shares comprising the company’s paid-up capital, to give members of the company who are entitled to receive notice of the next AGM notice of any resolution that may properly be moved at that meeting, as well as notice of a state- ment of not more than 1,000 words with respect to the matter referred to in any proposed resolution or the business to be dealt with at said AGM.
For public companies whose shares are listed on the stock exchange, additional provisions/rights apply for putting items on the agenda of a general meeting. 2.11 Challenging a Resolution In general, shareholders are bound by the company’s articles of association, so are not entitled to challenge resolutions taken by a general meeting through the correct procedure. However, a shareholder can challenge decisions of a general meeting where: • their personal rights were violated (for example, if they were not allowed to exercise their right to vote); • the resolution and the matters provided thereby are in breach of the law or the objects of the company; or • the procedure provided for in the articles of asso- ciation of the company and the law regarding the passing of the resolution at the general meeting was not followed. 2.12 Institutional Shareholder Groups Shareholders’ groups can generally work together in exercising their voting rights, either in line with bind- ing shareholders’ agreements or on an ad hoc basis. In doing so, they could exert pressure on the com- pany to adopt practices improving transparency and good corporate governance. Those practices could be included in the company’s articles of association or could be adopted by the company voluntarily. Moreo- ver, shareholders’ groups could appoint/exert pres- sure on the company to appoint one or more persons of their liking as members of the company’s board of directors so that the activities of the company can be checked/monitored from within the company and not merely on a shareholders’ level. Shareholders’ groups should monitor all the informa- tion the company is obliged to provide them with by law (such as audited financial statements), and should regularly carry out searches at the Department of Reg- istrar of Companies in order to monitor any corporate changes not communicated to them by the company and/or the company’s compliance with its statutory obligations.
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