Is a shareholder allowed to misuse the information right and victimise the executives?
4.01.2011Company: Amcham
A recent decision of the High Court in Prague sheds more light on the information obligation of the executives of a limited liability company towards the shareholders...
This matter had not been properly
adjudicated until recently, when the Court
drew the borderline of the shareholder’s
information right for the first time. The shareholders are entitled to obtain information
from the executives at the general
meeting or by inspecting the company’s
documents. Further, information
may be obtained from the executives outside
the general meeting.
Herein they have
a right to require such publicly unavailable
information that would first have to be compiled by the executives. In either case,
this right pertains only to such information
which can be used for the purposes of
exercising the rights of a shareholder. Hence,
it is not possible to victimise the executives
and require information which has
nothing in common with exercising the
shareholders’ rights.
The executives are also obliged to disclose
a trade secret. Such information may only
be disclosed in such a way that the confidentiality
of the information is ensured
(e.g., by blacking out the relevant parts of
an agreement). Protection of trade secrets
is therefore not a legitimate reason for the
executives’ refusal to disclose the required
information.
