European Company Law Text, Cases and Materials

Nicola de Luca, ‘Unequal Treatment and Shareholders’ Welfare Growth: “Fairness” v. “Precise Equality”’, 34 Del. J. Corp. L. 853–920, at 895 (2009)

Corporations are not only governed by a majority principle, but they are also governed by a majoritarian principle related to shares of interest. Indeed, the necessity to put all members of a community on the same playing field belongs to a very different economic and social model. This model is typically seen in mutual companies or by some non-profit organizations, where the majority principle is related to people and not to shares of interests, and votes are counted on a per capita basis. The majority principle related to shares of interest, however, is in itself an expression of inequality, because shareholders that are outside the majority group do not run the business either directly, or indirectly, through the appointment of directors. So they count less. This may lead some to question the justification for the shares of interests’ majority principle or the morality of capitalism in general, that may invoke (or misinterpret) the Aristotelian concept of distributive justice. But this seems to be a sterile and fundamentally wrong debate. The majority rule is a fundamental device to solve the deadlock which absolutely equal parties would unavoidably face.

Article 59 Regulation 2001/2157/EC

1. Amendment of an SE's statutes shall require a decision by the general meeting taken by a majority which may not be less than two thirds of the votes cast, unless the law applicable to public limited-liability companies in the Member State in which an SE's registered office is situated requires or permits a larger majority.