Legal English – Peter’s Pills – Lesson 30

Legal English for Notaries - By Federnotizie

Ordinary resolutions vs special resolutions

Transcript:

Hello!

When companies hold general meetings, they pass resolutions (approvare delibere). Remember, companies can hold two types of general meetings: The Annual General Meeting once a year, while any other general meeting for urgent business is called an Extraordinary General Meeting (See Peter’s Pills 29). There can be two types of resolutions passed at any general meeting: ordinary resolutions or special resolutions.

Ordinary resolutions are resolutions which are passed for the ordinary course of business of the company. They require a simple majority vote to be passed which means 50% of the votes plus at least one more valid vote. Ordinary resolutions are used where the directors have no authority to make certain decisions and where shareholders are called to vote.

Ordinary resolutions are often used to pass motions to:

  • Pay dividends;
  • Appoint and remove directors;
  • Approve directors’ service contracts;
  • Allot (assegnare) new shares.

Special resolutions on the other hand require at least a 75% majority vote to be passed and signal a significant change to a company. Special resolutions are needed when the company’s articles of association (statuto) require a special resolution to pass certain motions or when voting on motions in which the UK Companies Act 2006 requires a special resolution.

More specifically, Companies Act 2006 requires a special resolution to:

  • Change the company’s name;
  • Amend the articles of association (statuto);
  • Reduce the company’s share capital;
  • Disapply shareholder pre-emption rights (disapplicare i diritti di prelazione);
  • Change the company’s status – from Plc to Ltd or viceversa, etc.;
  • Voluntarily wind up the company (mettere in liquidazione volontaria).

Thank you very much and see you next time for more Peter’s Pills to improve your Legal English!


See more about resolutions and meetings in the UK Company’s Act 2006


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Legal English – Peter’s Pills – Lesson 30 ultima modifica: 2022-04-20T08:30:36+02:00 da Peter Liebenberg
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