Shareholders' duties

Our corporate legislation contains specific rules that regulate, in a comprehensive manner, the rights of the shareholders. Article 379 of the Code of Commerce indicates that among their rights are the right to participate in the deliberations of the meeting and to vote therein, to receive a proportional part of the corporate profits, to freely negotiate the shares, to inspect the books and commercial papers before the meetings and to receive a proportional part of the corporate assets at the time of liquidation.

Another right established by law is the right to be liable in the company up to the amount of their contributions. On the other hand, there are no express rules indicating the duties of the shareholders. We only see hints, in certain scattered norms, of what should be the obligations of the shareholders.

Rules such as that corporate decisions that are not of a general nature (i.e., that are not adopted in the general interest of the corporation and its shareholders) will not be enforceable against absent or dissenting shareholders (Art. 188 of the Code of Corporations) suggest that there is a duty of loyalty on the part of the shareholders when exercising their rights, but such duty is not imposed as an obligation and its disregard is not or may not be sanctioned. Indirectly, also, the Superintendence of Corporations has recognized that the non-exercise of the rights that the law confers to the shareholders may entail the loss of these and that -in such sense- the legal representative of the entity may, by order of the highest corporate body, file before the ordinary jurisdiction a lawsuit so that the extinctive prescription of its shares is 2/2 declared (Superintendence of Corporations, Oficio 220- 100424 of 2018).

With this, it is inferred that the shareholders have an obligation to exercise their political and economic rights, in order to actively collaborate with the company. The question of what are the duties of the shareholders is so strange that the Superintendence of Corporations itself, in Official Letter 220- 14442, limited itself to say that "regarding the duties that every shareholder undoubtedly has, [these] are limited to respecting the corporate bylaws (...)".

It would seem then that the only obligation of the shareholders, whose non-compliance entails a sanction established by law, is that of not paying the subscribed shares in a timely manner (art. 397 of the Company Code), since in such case, in addition to not being able to exercise the rights inherent to the quality of shareholder, they may see how the company applies the legal means to collect such debt after deduction of 20% as compensation for damages.

Since 1928, American jurisprudence (Meinhard vs. Salomon) established the duty of loyalty owed by the partners to each other, as follows: "the partners owe each other, as long as the enterprise continues, the duty of the most delicate loyalty. Many forms of conduct (...) are prohibited for those bound by fiduciary ties".

In turn, Muguillo, in his book "Conflictos Societarios" (Astrea, 2009, p. 30), states that Argentine law establishes as basic duties of the partner: to comply with the contribution, to act in good faith and with loyalty towards the company and the partners, to compensate the company for the acts that may cause damages and to collaborate in the administration of the company. Our law should regulate these duties, since there cannot be rights without correlative obligations.