Binding of Shareholders of Limited Liability Companies to an Arbitration Clause in actio pro socio

Abstract

This study primarily aims to answer the question of whether partners or shareholders of capital companies are bound by an arbitration clause in the event of an actio pro socio action. The first part outlines this type of action and its importance in commercial practice. It then discusses how to introduce an arbitration clause into the articles of association or by laws of an existing company, in accordance with applicable de iure provisions. The article then presents three competing positions in doctrine and case law regarding the effectiveness of arbitration clauses with regard to partners. This issue highlights a conflict between the principle of unanimity, which is typical of arbitration, and the principle of majority rule, which is characteristic of capital companies. In this context, the provisions of the Commercial Companies Code specifying the qualified majorities required to amend a company’s articles of association or statutes are of particular importance. The study’s thesis is that an arbitration clause in a capital company is valid if it has been introduced with the requisite qualified majority. This solution is justified in practice – requiring unanimity could lead to decision-making paralysis in companies with a dispersed ownership structure. The study also analyses the scope of the arbitration clause. It is assumed that the arbitration clause may cover disputes concerning not only resolutions of corporate bodies, but also actio pro socio claims.