Right to information of a shareholder in a limited liability company

There may be information that is rationally useful or relevant for the protection shareholders’ rights that is not essential for the exercise of their participation rights. In such cases, the denial of the information does not justify the challenge of the affected resolutions, but it does justify the exercise of other actions with the objective of obtaining such information.

In ruling STS 2900/2024 of May 29, the Supreme Court analyzes the scope of the shareholder’s right to information in the context of the approval of the annual accounts and the management of the company. In this regard, the Court emphasizes that after the reform of the Capital Companies Act (LSC) operated by Law 31/2014 of December 3, corporate resolutions can only be challenged for infringement of the right to information if the incorrect or not provided information would have been “essential” for the exercise of the voting right by the shareholder, pursuant to Article 204.3 b) LSC.

The Court clarifies what essential information means for the purpose of challenging a corporate resolution for violation of the right to information, based on a relevance test. For the Court, essential information is that which must be known in order to deliberate and vote on the resolutions affected. In this sense, the ruling strengthens the instrumentality of the shareholder’s right to information with respect to the exercise of his right to vote and other participation rights.

The judgment differentiates the content and scope of the qualifier “essential” in article 204 LSC with that of “necessary” used in a negative sense by article 197.3 LSC when it prescribes that the directors of corporations shall not be obliged to provide the requested information when such information is unnecessary for the protection of the shareholder’s rights. The necessary nature of the information, understood as rationally useful or relevant to condition the behavior of the shareholder with respect to the exercise of his rights, is a prerequisite for the obligation to inform to arise. Consequently, article 204.3.b) LSC prescribes that not every breach of this obligation justifies challenging the resolutions affected. Only information considered “essential” can justify the challenge of corporate resolutions for infringement of the right to information. As this limitation to the challengeability of the resolutions is articulated, it is up to the challenging shareholder to justify such essential nature.