The right of withdrawal exercited by the shareholder who did not partecipate in the change of the clause limiting the circulation of shares is legitimate

Supreme Court of Cassation, June 27, 2022, No. 20546.

A shareholder of a joint stock company who did not participate in the amendment of the bylaws to remove the preemption clause limiting the circulation of shares has the right of withdrawal, regardless of the substantive significance of the amendment.

This is the principle expressed by the Supreme Court of Cassation in a very recent decision where it was called upon to rule on the legitimacy of the withdrawal exercised by the shareholder following the shareholders’ resolution that eliminated from the bylaws a clause limiting the transfer of shares of the issuing company from the shareholder of the S.p.A. to a company controlled by the shareholder himself.

For the purpose of the withdrawal, the shareholder invoked the provisions of Article 2437(2)(b), which grants the right of exit to dissenting shareholders or those who, as absent or abstaining, did not concur in the adoption of the resolution providing for “the introduction or removal of restrictions on the circulation of equity securities“.

In this case, the Supreme Court overturned the decision of the Florence Court of Appeals, which, in turn, had upheld the decision of the lower court.

In the first two decisions, the judges ruled that the withdrawal exercised by the shareholder was unlawful, considering the amendment to the bylaws resolved by the S.p.A.’s shareholders’ meeting to be devoid of “substantial relevance”.

Specifically, the Florence Court of Appeals had found that the amendment to the bylaws had not resulted in any substantive change to the preemption clause, as the possibility of an intra-group transfer did not, in practice, involve a change in the decision-making center to which the shareholder’s interest was directed.

When questioned on this point, the Supreme Court departed from the above guidance, noting the irrelevance of the “substantial relevance” of the amendment and stating that for the purposes of the legitimate exercise of the right of exit, it is sufficient that the amendment to the bylaws removed a previously existing limitation on the circulation of shares.

In affirming this, the Supreme Court gave relevance to the textual datum of the rule, noting how, in the case of a change in the corporate purpose (a cause for withdrawal provided for in Article 2437, paragraph 1, letter a, Civil Code), it was the legislature itself that gave entry to a discretionary assessment aimed at ascertaining the “significant” nature of the change made.

Hence the conclusion that, in other cases of withdrawal pertaining to changes in the articles of association, in the absence of a specific provision, it is necessary to give relevance only to the change in the clause, omitting any assessment in terms of substantive relevance.