FRANCE Trends and Developments Contributed by: Karl Hepp de Sevelinges and Nicolas Martin, Jeantet
decision dated 12 February 2025, which now prohibits the distribution of the retained earnings outside the annual ordinary general meeting of the shareholders; and • that the beneficiaries (ie, shareholders) were aware or could not ignore the irregular nature of such distribution at the time of such distri - bution. For distribution decisions preceding the publica - tion of the court decision, we do not see how the company could prove that the sharehold - ers could have reasonably been aware of the irregular distribution, and could thus claim the restitution of the unjustified dividends.
For decisions post publication of the court deci - sion, a prudent approach will need to be taken in order to comply with the new rule set forth by the court and avoid any risk of nullity. In any case, and in order to avoid any risk of nullity, we would recommend regularising previ - ous distributions of dividends (having not been carried out in compliance with the new require - ments) during the next annual ordinary general meeting of the shareholders by including a spe - cial resolution under which the shareholders would approve the regularisation of the former distribution of dividends from the retained earn- ings account.
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