MEXICO Law and Practice Contributed by: Fernando Hernández G., Elvia Ríos Saldaña, Ana Karen Inzunza Sánchez and Luis Andrés Estrada Intriago, Vázquez Aldana, Hernández Gómez & Associates (VAHG)
Meetings may be held in person or through electronic, optical or any other technological means, provided that real-time interaction, proper identification of par - ticipants and the effective exercise of voting rights are ensured, in accordance with applicable law and the provisions of the by-laws. The proceedings of shareholders’ meetings must be recorded in minutes entered into the company’s cor - porate books, and shareholders may attend in per - son or be represented by duly authorised proxies, in accordance with applicable law and the by-laws. In the case of S.A.P.I., there is greater flexibility to regu - late these matters – the by-laws may regulate, with greater flexibility, matters such as quorum and voting thresholds (within legal limits), notice mechanisms, the holding of non-in-person meetings, and the restric - tion or expansion of voting rights. In publicly traded companies (S.A.B.), in addition to the foregoing, the provisions of the Securities Market Law apply, estab - lishing enhanced standards in relation to minority rights, transparency, disclosure and corporate govern - ance, including specific rights to request information, appoint directors and bring liability actions, whereas in publicly traded companies (S.A.B.), in addition to the foregoing, the provisions of the Securities Mar - ket Law apply, establishing enhanced standards in relation to minority rights, transparency, disclosure and corporate governance, including specific rights to request information, appoint directors and bring liability actions. Additionally, shareholders may provide in the by-laws that unanimous consent resolutions adopted in lieu of a general ordinary shareholders’ meeting by the shareholders holding the total voting shares of the company, will have the same validity and legal effect as those adopted at a duly convened meeting. 4.4 Shareholder Claims Actions Against the Company The L.G.S.M. provides various legal grounds for shareholders to bring actions against the company or its directors. Among these, the most notable is the liability action against directors for damages caused to the company as a result of a breach of their duties, which may be brought either by the company itself or
directly by shareholders representing at least 25% of the share capital. In the latter case, the action must be exercised for the benefit of the company and not solely in the interest of the claiming shareholders; accordingly, the claim must cover the full amount of the damages caused. Furthermore, shareholders bringing such action must not have previously approved any shareholders’ res - olution determining that no action should be taken against the directors. Any recovery obtained as a result of the action shall accrue to the company. Additionally, shareholders may bring individual actions where they suffer direct damage to their own patri - mony, distinct from that suffered by the company. In relation to shareholders’ meetings, shareholders may primarily seek the nullity of resolutions and exer - cise opposition rights. Nullity actions arise where res - olutions contravene the law or the by-laws, or where legal requirements relating to notice, quorum or voting are not satisfied. The opposition action allows share - holders to challenge specific resolutions before the courts and may be exercised by shareholders rep - resenting at least the minimum percentage required under applicable law, generally ranging from 25% to 33% of the share capital, depending on the circum - stances. Minority Protection Mechanisms The L.G.S.M. also provides for minority protection mechanisms, such as the right of shareholders rep - resenting at least 33% of the share capital to request the convening of a general shareholders’ meeting. In particular, as noted in 4.3 Shareholder Meetings , this right may be exercised by the holder of a single share where no shareholders’ meeting has been held for two consecutive fiscal years or where such meetings have failed to address the matters required by law. Share - holders may also request that the vote on matters with respect to which they do not consider themselves suf - ficiently informed be deferred. In the case of publicly traded companies (S.A.B.), shareholders also benefit from additional mecha - nisms under the securities regulatory framework, enabling them to seek remedies for breaches relating
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