PART III
Management of Limited Companies

1. GENERAL PROVISIONS

Section 1144. Every limited company must be managed by a director or directors under the control of the general meeting of shareholders and according to the regulations of the company.

Section 1145. After registration of the company, no regulations may be created and no additions to or alterations of the regulations or of the contents of the memorandum may be allowed except by passing a special resolution.

Section 1146. It shall be the duty of the company to enforce the registration of every new regulation, addition or alteration within fourteen days after the date of the special resolution.

Section 1147. Ten printed copies of every new regulation or of the altered memorandum or regulation shall be provided at the same time at the Registration Office.

Section 1148. Every limited company may maintain a registered office to which all communications and notices may be addressed.

Notice of the situation of the registered office and of any change therein, shall be given to the Registrar of companies, who shall record the same.

Section 1149. As long as the shares have not been fully paid up, the company can not print or mention the capital of the company in any notice, advertisement, bills, invoices, letters or other documents, without also clearly mentioning at the same time what percentage of such capital has been paid up.

2. DIRECTORS

Section 1150. The number and remuneration of the directors shall be fixed by a general meeting.

Section 1151. A director can be appointed or removed only by a general meeting.

Section 1152. At the first ordinary meeting after the registration of the company and at the first ordinary meeting in every subsequent year, one-third of the directors, or, if their number is not a multiple of three, then the number nearest to one-third will have to retire from office.

Section 1153. Any director who would like to resign from his post shall submit his resignation letter to the company. The resignation shall take effect from the date the resignation letter reaches the company.

The director who resigns under paragraph one may notify the Registrar of his resignation.

Section 1154. If a director becomes bankrupt or incapacitated, his office is vacated.

Section 1155. Any vacancy occurring in the board of directors in a fashion other than by rotation can be filled up by the directors, but any person so appointed shall retain his office during the time frame only as the vacating director was entitled to retain the same.

Section 1156. If a general meeting removes a director prior to the expiration of his period of office, and appoints another person in his stead, the person so appointed shall retain his office during the time period only as the removed director was entitled to retain the same.

Section 1157. When there is a change of a director or directors, the company shall submit the registration thereof within fourteen days from the date of such change.

Section 1158. Unless otherwise provided by the regulations of the company, the directors have the powers described in the six following sections.

Section 1159. The subsisting directors may act notwithstanding any vacancy among them but, if and so long as their number is lowered below the number necessary to form a quorum, the subsisting directors can act for the purpose of increasing the number of directors to that number, or of calling for a general meeting of the company but for no other purpose.

Section 1160. The directors may set the quorum necessary for the transaction of business at their meetings and unless so fixed the quorum shall (when the number of directors exceeds three) be three.

Section 1161. Questions arising at any meeting of directors are decided by a majority of votes, in case of an equality of votes the chairman has a casting vote.

Section 1162. A director may at any time call for a meeting of directors.

Section 1163. The directors may elect a chairman of their meetings, and fix the period for which he is to hold office, but if no such chairman is elected, or if at any meeting the chairman is not present at the time appointed for holding the same, the directors present may choose one of their members to be chairman of such meeting.

Section 1164. The directors may delegate any of their powers to managers or to committees made up of members of their body. Every manager or committee shall, in the exercise of the power so delegated, conform to any order or regulation that may be imposed on them by the directors.

Section 1165. Unless otherwise provided by the delegation, questions arising at any meeting of a committee shall be decided by a majority of votes of the members; in case of an equality of votes the chairman has a casting vote.

Section 1166. All acts made by a director shall, regardless of if it be afterwards discovered that there was some defect in his appointment, or that he was disqualified, be as valid as if such person had been duly appointed and was qualified to be a director.

Section 1167. The relations between the directors, the company and third persons are governed by the provisions of this Code concerning Agency.

Section 1168. The directors must display the diligent conduct of a careful business man in the conduct of the business.

In particular they are jointly responsible:
(1) For the payment of shares by the shareholders being actually made;
(2) For the existence and regular keeping of the books and documents prescribed by law;
(3) For the proper distribution of the dividend or interest as prescribed by law;
(4) For the proper enforcement of resolutions of the general meetings.

A director can not without the consent of the general meeting of shareholders, become involved with commercial transactions of the same nature as and competing with that of the company, either on his own account or that of a third person, nor may he be a partner with unlimited liability in another concern carrying on business of the same nature as and competing with that of the company.

Section 1169. Claims against the directors for compensation for injury caused by them to the company may be filed by the company or, in case the company refuses to act, by any of the shareholders.

Such claims may also be enforced by the creditors of the company in so far as their claims against the company remain unsatisfied.

Section 1170. When the acts of a director have been approved by a general meeting, such director is no longer liable for the said acts to the shareholders who have approved them, or to the company.

Shareholders who did not approve of such acts cannot enter their action later than six months after the date of the general meeting on which such acts were approved.

3. GENERAL MEETINGS

Section 1171. A general meeting of shareholders should be held within six months after the registration, and shall thereafter be held at least every 12 months. Such meeting is classified as an ordinary meeting.

All other general meetings are classified as extraordinary meetings.

Section 1172. The directors may call for extraordinary meetings whenever they think fit.

They must immediately, without delay, call for such meetings when the company has lost half the amount of its capital, in order to inform the shareholders of such loss.

Section 1173. Extraordinary meetings must be called for if a requisition to that effect is made in writing by shareholders holding not less than one-fifth of the shares of the company. The requisition must specify the object for which the meeting is required to be called for.

Section 1174. Whenever a requisition for the calling for an extraordinary meeting is made by the shareholders according to the last preceding section, the directors shall forthwith call for such meeting.

If the meeting is not called for within thirty days after the date of the requisition, the person asking for the requisition, or any other shareholder amounting to the required number, may themselves call for it.

Section 1175. Notice of the calling for every general meeting shall either be published at least twice in a local newspaper, not later than seven days before the date set for the meeting, or shall be sent by post not later than seven days before the date set for the meeting to every shareholder whose name appears in the register of shareholders.

The notice shall specify the place, the day and the hour of meeting and the nature of the business to be transacted.

Next Page
[1]  [2]  [3]  [4]