Shareholders' agreements in Denmark: must be accorded legal safeguards from 1 March 2010, but how?

The article warns that with effect from 1 March 2010, the new Danish Companies Act (on public and private limited companies) has seriously weakened the effect of shareholders’ agreements which have been entered into on Danish companies. These agreements (in the act’s new terminology: “owners’ agreements”) cannot bind the company within the sense of company law under the new state of law, and voting rights agreements, agreements on right of pre-emption etc. will therefore only apply at the level of contract law between the parties to the agreement. This article for European Business Law Review analyses the consequences of this. Rights and duties in the owners’ agreements must now be reiterated to the greatest possible extent in the company’s articles of association so that the precepts become binding on the company and its management. Whether the parties to the owners’ agreement can be required (on the basis of unwritten principles of loyalty under contract law) to vote for such a repetition of the central provisions of the owners’ agreement in the articles of association is then analysed.