Intrasocietary arbitration

Lawyou — jueves, 25 de febrero de 2021

The alternative in the intra-corporate conflict

Like any other contractual relationship, being a partner in a company implies assuming rights and obligations vis-à-vis the other partners and vis-à-vis the company.

During the life of the company, conflicts may arise, and on some occasions it may be necessary the intervention of a third party to settle issues in which there are conflicting positions.

And who will be the one to settle the issue??

We may think that in case of not reaching an agreement we would have to go to court.

But we should know that there is an alternative to ordinary jurisdiction: arbitration.

Article 11 bis of Law 11/2003 of May 25, 2003 on arbitration establishes that capital companies may submit disputes arising therein to arbitration.

In general, Article 28 of Royal Legislative Decree 1/2010 of 2 July, which approves the revised text of the Capital Companies Act, establishes the autonomy of the will of the shareholders, providing that they may include the agreements they deem appropriate, provided that they are not contrary to the applicable law.

Prerequisites for adopting intra-corporate arbitration.

Firstly, as we have already noted above, thevoluntariness of the parties to submit.

Secondly, the matter subject of arbitrationmust be freely available to the partners according to law, i.e. economically quantifiable.

On the other hand, the submission to arbitration by the partners must be express and in writing, by signing an arbitration agreement, which may be incorporated in the articles of incorporation or signed after the incorporation, and must be approved by two thirds of the share capital, and registered in the Commercial Registry in order to have erga omnes effects, against all the partners (present and future) and against the company.

In addition, the intrashareholder arbitration must be entrusted to an arbitration institution, and shall be arbitration at law (the arbitrators shall decide in accordance with the law applicable to the case).

Recognition of arbitration by the legislator

The legislator has recognized the arbitration award as executive title with res judicata effects, thus validating arbitration as an alternative to ordinary jurisdiction for the resolution of conflicts.

Do you need legal advice?

If you want to learn more about intra-corporate arbitration, the best thing to do is to contact a specialized lawyer. In this way, you will ensure that your matter will be resolved well, with full knowledge of the law in force and the most beneficial options for your case.

Lawyers at LAWYOU will help you.

At LAWYOU we have lawyers with many years of experience who can help you or provide you with more information about the currently applicable legislation and future changes. Do not hesitate to contact us to tell us about your case through our email or, if you prefer, you can also call us on 602 226 895.

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