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TERMINATION OF DIRECTOR FOR BREACH OF NON-COMPETITION OBLIGATION

The directors of companies are attributed with certain duties of compulsory compliance inherent to the performance of their post. Such duties may be summarised as follows: Duty of loyalty; and Duty to avoid situations of conflict of interest. Both obligations have, as a general rule, an imperative character, in accordance with article 230 of the Spanish Capital Companies Act, and…

Restrictions on the transfer of membership interests (shares) in limited liability companies.

The resolution of the General Directorate of Registries and Notaries (Dirección General de Registros y Notariado  – “DGRN”) dated 31st July 2018 settled the matter concerning the legality of drag-along and tag-along clauses, by pointing out the limits to the free will of the partners (shareholders) regarding establishing restrictions upon the free disposal of membership interests (shares) in a limited…

GROUNDS FOR THE WINDING-UP OF COMPANIES IN SPAIN

Spanish companies are obliged to wind-up under certain circumstances, which are covered by article 363 of the Spanish Capital Companies Act. Said circumstances are as follows: A company must be wound up: a) In the event of ceasing to engage in the activity or activities which constitute the corporate purpose. In particular, the cease of activities shall be deemed to…

PERSONAL DATA PROTECTION – PENALTY SYSTEM.

The council of ministers has passed Royal Decree-Law 5/2018 of 27th July regarding urgent measures for adapting Spanish Law to the European Union law regarding data protection. Said Royal Decree-Law entered into force on 31st July 2018. This regulation is aimed at bringing Spanish legislation in line with EU Regulation 2016/679 of the European Parliament and of the Council, of…