GERMANY Law and Practice Contributed by: Eva Nase and Kay-Uwe Neumann, POELLATH
extent, be in regular conversation with investors on supervisory board-related issues. Non-listed Companies Conversely, non-listed companies typically do engage with their shareholders. GmbH In a GmbH, the involvement of the sharehold - ers in the management is also statutorily more extensive. In contrast to the AG, the sharehold - ers’ meeting resolves upon the appointment and dismissal of the managing directors and on the conclusion of their service agreements. Also, the shareholders of the GmbH are able to direct the managing directors to take or refrain from taking certain actions in the business by way of inter - nally binding instruction. 5.3 Shareholder Meetings Annual General Meetings An annual general meeting is mandatory in an AG and KGaA within the first eight months of a financial year, and in an SE within the first six months of a financial year. The annual meeting has to resolve upon the ordinary topics (see 3.2 Decisions Made by Particular Bodies ) and upon the remuneration system, the latter resolu - tion being non-binding (see 4.10 Approvals and Restrictions Concerning Payments to Direc- tors/Officers ). Further extraordinary topics on fundamental decisions can also be put on the agenda of the annual general meeting, or can be passed in an extraordinary general meeting. Apart from this, general meetings are to be con - vened if necessary for the welfare and going concern of the company. The general meeting has to be convened no later than 30 days prior to the date of the general meeting, or no later than 36 days prior to the meeting if shareholders are required to register for the general meeting. In
an AG and a two-tier system SE, the convening is generally the obligation of the management board, or exceptionally the supervisory board. Within a single-tier system SE, the administrative board is responsible for the convening. However, shareholders whose share is equiva- lent to at least 5% of the registered share capital may also demand the convening of a general meeting. Shareholders whose share in the share capital is that high or corresponds to a nominal stake of EUR500,000 may demand that certain additional items are put on the agenda. The demand has to be received by the company 24 days prior to the general meeting at the latest, or no later than 30 days prior to the general meet - In August 2022, the German Parliament passed a new law introducing virtual general meetings – ie, meetings without the physical presence of the shareholders or their proxies at the location of the general meeting, as a permanent option and alternative to the physical general meeting. However, pursuant to the new provisions, virtual general meetings require a corresponding provi - sion or authorisation in the articles of association as of 31 August 2023. Such provision or authori - sation may only be set for a maximum term of five years. Annual General Meeting Invitation The invitation has to fulfil a lot of formalities, such as setting out the business name and seat of the company, the time and place of the gen - eral meeting, and the agenda. For listed compa - nies, the invitation has to provide further infor - mation – eg, about the rights of the shareholders in respect of the general meeting. ing for listed companies. Virtual General Meetings
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