SENEGAL Trends and Developments Contributed by: Malick Lo, Chadi Safieddine and Mohamed Kamil, SCP Houda & Associés
This is a powerful tool, but it must be used with cau - tion. A court will only order it in cases of proven dead - lock and actual danger and will refuse to make such an order merely as a means of pressure in a latent conflict. The CCJA’s case law tends to strictly circum - scribe the conditions for its grant. The Ad Hoc Representative Less intrusive than the provisional administrator, an ad hoc representative may be appointed to carry out a specific task: convening a meeting, exercising a vot - ing right, negotiating a transfer. This solution is often preferred when the dispute is limited to a particular decision and the company’s general operations are not compromised. Judicial Dissolution for Serious Deadlock As a last resort, Article 200 of the AUSCGIE allows for judicial dissolution on just grounds, notably in the event of a serious breakdown between sharehold- ers paralysing the company’s operations. This radi - cal solution is rarely ordered by Senegalese courts, which prefer intermediate mechanisms. It nonetheless remains a dissuasive threat in negotiations. An alternative, more balanced mechanism is the judi - cial or contractual exclusion of a shareholder, allowing the company to continue its activities without being dissolved. However, such exclusion requires a solid statutory or contractual basis, as OHADA law does not, in principle, recognise outright exclusion outside
Careful drafting of the articles of association and shareholders’ agreements is paramount. These should include appropriate quorum and majority rules, exit clauses such as drag-along, tag-along and buy-or- sell, amicable settlement mechanisms and arbitration clauses. A generic agreement copied from another jurisdiction without adaptation to OHADA law is a fre - quent source of difficulties and unenforceable clauses. Rigorous maintenance of corporate life (minutes, reg - isters and regulated agreements properly submitted for approval) deprives opponents of many procedural arguments. Many disputes originate in formal irregu - larities that companies too often underestimate. Peri - odic legal audits are, in this respect, a modest invest - ment relative to the risks avoided. Finally, in the event of emerging tensions, it is often wise to resort promptly to professional mediation or an independent audit. These tools can sometimes restore dialogue before the crisis degenerates and positions become so entrenched that recourse to a court or arbitral tribunal becomes inevitable. Conclusion The prevention and management of shareholder dis - putes in the OHADA region rests on a substantial legal arsenal. The provisional administrator, the recognition of extra-statutory agreements and the development of case law on abuse of rights provide practitioners with robust tools. Their effectiveness, however, depends on careful contractual engineering at the outset and, subsequently, on an intelligent articulation of the rela - tionship among negotiation, arbitration and judicial action. For foreign investors and local operators alike, antici - pation remains the key. A well-structured company is not one that hopes never to face a crisis: it is one that has contractually organised the prevention and resolution of crises.
such frameworks. Recommendations
Experience shows that shareholder disputes, while rarely entirely avoidable, can be considerably mitigat - ed by a few best practices that international investors and local operators would do well to integrate into their legal strategy.
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