Voting is the main right of a member of a LLC. It allows the company to develop and reach its goals. It represents the democratic idea of "one person, one vote", but instead of people, here we have member units.
Voting
rights are necessarily escorted by two other rights: information and the right to attend the meetings. The information right provides the member knowledge about a
certain situation, and motivates the direction of his vote, whereas the right
to attend a meeting makes voting possible, even with a proxy.
However, there is one more important thing
than voting: how we count votes.
According to Spanish Law, LLCs (called SL)
have the following system:
In opposition to Public Limited Companies, it
is not mentioned any initial attendance quorum or specified minimum for LLCs.
Corporate resolutions are approved with the valid votes of a third of the authorized
share capital, so the Law implies that, at least, the same quorum is necessary
to hold the meeting.
This percentage can be raised by LLCs in their Articles of Association, but with
the express prohibition of unanimity, and this is when problems arise.
Given a
certain LLC, where each partner owns a 25% of the share capital and the Articles
of Association read that corporate resolutions must be approved with, at least,
a 76% of the share capital. In this situation, even though unanimity has not
been established, it is necessary that all partners agree (de facto unanimity); otherwise, the
corporate resolutions will not be approved, which could eventually become a
cause of dissolution of the company, if the situation has paralyzed the
corporate bodies. This is an unwanted situation for everyone, especially for
the partners, considering that a whole functioning company is more valuable
than a separate 25% of it.
In my opinion, the most pragmatic thing would
be to state the standard quorum for most of the resolutions, and rise it specifically
for some key resolutions, (in case of a merger, e.g.), but it is clear that due
to the huge variety of LLCs, the most appropriate measure will depend on the
particular case.
Also, include
in the Articles of Association an arbitration clause. This is not very common
yet, but I am sure it will gain ground.
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