Background
Under Peruvian law, shareholder agreements have become important tools for better company governance. While the General Corporations Law does not expressly regulate them, legal experts and court decisions are increasingly recognizing them. These agreements allow partners to create rules that amend or modify the corporate bylaws.
What Is a Shareholders’ Agreement?
A shareholders’ agreement is a private agreement between one or more partners in a company, which regulates aspects such as:
- The exercise of voting rights.
- Restrictions on the transfer of shares.
- Composition of the board of directors.
- Drag-along and tag-along rights.
- Dividend policies.
These agreements enable the adaptation of the corporate structure to the real needs of its partners, beyond the formal provisions of the articles of association (Revoredo.pe. 2021).
Validity and Enforceability
Academic publications, such as Revista Actualidad Mercantil of PUCP, highlight a key issue: whether these agreements can be enforced against the company or third parties. They are only binding among the signatory parties. Conversely, if added to the bylaws or if the company signs the agreement, they may also bind the company.
In this regard, according to the Revista Advocatus of the University of Lima, corporate bodies should be aware of the agreements to ensure their effectiveness and, when possible, ratify them in a general meeting.
Types of Common Clauses
Among the most commonly used clauses are:
- Drag-along: It entitles a majority shareholder the right to compel minority shareholders to sell their shares under the same conditions.
- Tag-along: It enables minority shareholders to join a sale initiated by a majority shareholder.
- Voting syndication agreements: The parties agree to vote jointly on certain corporate decisions.
These clauses ease the reduction of internal conflicts, establish orderly exits from the share capital, and align the interests of the partners (Revoredo.pe. 2021).
Risks and Challenges
One of the main risks is ambiguity or contradiction with the corporate bylaws, which can lead to legal disputes and even the partial invalidity of the agreement. Additionally, in indefinite term agreements, the issue of unilateral resolution has been the subject of doctrinal debate, as analyzed in the Revista de Derecho y Empresa (Law and Business Magazine).
Similarly, the parties often enter into agreements without adequate legal advice, resulting in ambiguities or clauses that may be challenging to enforce.
Common Conflict Cases
According to PPU Legal (2021), the most frequent disagreements among partners include:
- Disputes over strategic decision-making.
- Departures of partners without clear rules.
- Unconsented transfers of shares.
In all these cases, well-structured shareholder agreements act as an effective preventive mechanism.
Conclusion
Although private in nature, shareholder agreements play a crucial role in the management and stability of Peruvian companies. Transparent drafting, adherence to corporate bylaws, and comprehension by all parties are vital for legal effectiveness. In a business environment where conflicts between partners can escalate quickly, these agreements are an indispensable legal tool.
Legal Advice for Well-structured and Risk-free Shareholder Agreements
VAG Global offers tailored legal advice to help companies prevent partner conflicts, protect investments, and enhance governance. Contact our corporate law team to ensure your shareholder agreements are robust and enforceable for your company’s success.
References: Shareholder Agreement Clauses / Blog PUCP / Revistas PUCP / Revistas U. of Lima / PPU Legal