GIBRALTAR Law and Practice Contributed by: Adrian Pilcher, Stuart Dalmedo and Louise Anne Turnock, ISOLAS LLP
5. Shareholders 5.1 Relationship Between Companies and Shareholders Shareholders provide some or all of the financial backing for a company. In exchange for invest - ing in the company, a shareholder may receive a dividend and may also benefit from capital appreciation of the value of their shares. The money produced by the sale of shares enables the company to commence and continue its business. Under Gibraltar law, a company has its own legal personality, which is separate from that of its shareholders. Shareholders will therefore only be liable for losses incurred by the company up to the value (if any) unpaid on their respec - tive shares. It must be noted, however, that the concept of “piercing the corporate veil” is rec - ognised in Gibraltar, and there may be certain instances whereby the company’s separate legal identity will be set aside by the courts and the shareholders may become personally liable for the debts and liabilities of the company. For instance, courts will look behind the veil in cases of fraud or deliberate breaches of trust. In these cases, the courts ensure that an appropriate remedy is available against the individuals who have committed a wrong using a company they control. The Companies Act establishes that the pro - visions of a company’s constitution bind the company and its members to the same extent as if there were covenants on the part of the company and of each member to observe those provisions. Therefore, the shareholders’ relation - ship with the company is contractual. The rights of each shareholder will depend on the rights attached to their respective shares, and this will
Under the Listed Companies (Members’ Rights) Regulations 2011, a listed company (that is, a company which has its registered office in Gibraltar and whose shares are admitted to trad- ing on a regulated market situated or operating within the EU) must establish a remuneration policy as regards its directors, which must be approved at a general meeting and may only remunerate its directors in accordance with the remuneration policy. Listed companies may derogate from the remu - neration policy only in exceptional circumstanc - es, and provided always that the policy includes procedural conditions by which such a deroga - tion can take place and specifies the elements of the policy from which a derogation is possible. The directors’ remuneration policy is a binding policy and must be approved by the sharehold - ers at least once every four years. 4.11 Disclosure of Payments to Directors/Officers The Companies Act does not require the public disclosure of director remuneration. Listed companies are required under the List - ed Companies (Members’ Rights) Regulations to prepare a remuneration report providing a comprehensive overview of the remuneration, including all benefits, in whatever form, awarded or due during the most recent financial year to individual directors, including to newly recruited and to former directors, and to make this report publicly available on the company’s website, free of charge, for a period of ten years, beginning on the date it is first made public.
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