Exit rights of minority shareholders in a private limited company (IVOR nr. 72) 2010/2.2.3.4:2.2.3.4 Art. 6 ECHR and the inquiry proceedings

Exit rights of minority shareholders in a private limited company (IVOR nr. 72) 2010/2.2.3.4

2.2.3.4 Art. 6 ECHR and the inquiry proceedings

Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.Deze functie is alleen te gebruiken als je bent ingelogd.

Art. 6 ECHR also plays a role in the inquiry proceedings, but only to the extent that civil rights and obligations are determined in these proceedings. In the Textlite case, the European Court of Human Rights shed light on the question of when Art. 6 ECHR applies in the Dutch inquiry proceedings. In the Textlite case, complaints were raised by the supervisory directors of a company subject to inquiry. Amongst other matters, the supervisory directors put forward that their civil rights and obligations were determined on the basis of a report established following proceedings to which they had not been party. The Court held:

"The Court notes, in relation to the first complaint, that the inquiry was ordered with a view to obtaining information as to the state of affürs of the company, and as to the causes thereof, in order to take certain measures in favour of a better functioning of the company. It was not the purpose of the inquiry to secure evidence concerning the applicants' or any other person's individual legal liability. Moreover, the investigator's report did not, and could not, of itself "determine" the applicants' "civil rights and obligations". Nor were the findings it contained in themselves binding on the Enterprise Section of the Amsterdam Court of Appeal, or any other tribunal. There was therefore, for the purposes of Article 6 1 of the Convention, no reason for the applicants to be called to participate in the proceedings until the report was submitted to the Enterprise Section (...). From this it follows that, until the investigator finalised his report and submitted it to the Enterprise Section, the question of fürness in the sense of Article 61 of the Convention vis-à-vis the applicants could not arise."1

As clarified by the Court, Art. 6 ECHR does not apply from the start of the proceedings up to and including the deposition of the inquiry report with the registry of the High Court of Amsterdam. However, Art. 6 ECHR applies when final remedies are ordered or when persons are ordered to pay the costs of the proceedings pursuant to Art. 2:354 DCC.2 Moreover, it is relevant to know that the OK did not order immediate remedies in the Textlite case. In my view, Art. 6 ECHR also applies when immediate remedies are ordered that affect civil rights or obligations, such as the suspension of managing directors or supervisory directors.3

This study deals with the order for the winding-up of the company, an order that can be given in the inquiry proceedings.4 In my opinion, Art. 6 ECHR applies when a winding-up order is provided by the court in the inquiry proceedings. An order for the winding-up of the company involves the determination of civil rights of all shareholders involved, while the winding-up leads to termination of the shares. In the Textlite decision, the Dutch Supreme Court acknowledged that Art. 6 ECHR applies when final orders in the inquiry proceedings are provided.5 As the winding-up is ordered against the company, the civil rights of the company are involved as well:6

In line with the view of IJs selmuiden and Geerts, I am of the opinion that the OK must call all shareholders and all other parties involved, such as the company, to appear and be heard at the trial at which the request for the order to wind up the company is dealt with.7A comparable view was taken by Company Law Committee (Commissie Vennootschapsrecht) in its 1975 proposal for separate winding-up proceedings.8 This requirement follows from the principles of procedural law, found in Art. 19 RV, Art 279 paragraph 1 RV and Art. 6 ECHR. Reference can be made to the Mantovanelli case, in which the European Court of Human Rights notes:

"The Court notes that one of the elements of a für hearing within the meaning of Article 6 para. 1 (art. 6-1) is the right to adversarial proceedings; each party must in principle have the opportunity not only to make known any evidence needed for his claims to succeed, but also to have knowledge of and comment on all evidence adduced or observations filed with a view to influencing the court's decision."9

By calling all persons involved to appear, they are then given the opportunity to inform the OK regarding any circumstances that may block a winding-up order or regarding the absence of those circumstances. Moreover, similar to Hermans who wrote on this subject in general, I am of the opinion that parties have the right to object to the application of the winding-up order, the right of equality of arms as well as the right to receive a well-reasoned judgment.10 All these rights can be derived from Art. 6 ECHR.

Deze functie is alleen te gebruiken als je bent ingelogd.