Appointment and removal

How are directors appointed?

Directors must be appointed by the company's shareholders (via a shareholders' general meeting or by unanimous written resolution).

A resolution appointing a director must be filed at the company’s registry office.

Directors must be appointed for the period fixed in company’s bylaws, which must not exceed four calendar years with re-appointment being permitted.

Last modified 1 Mar 2021

Directors must consent to their appointment and can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or, if the company's constitution allows, by the other directors.  In subsidiary companies, the constitution commonly allows the parent company to appoint directors by a written resolution as sole member of the subsidiary.

Details of the appointment must be filed with ASIC.  Companies must do this within 28 days of the appointment taking place, or the company will be subject to late fees.  A director's date and place of birth, former names and residential address must be supplied to ASIC, and are included on the public record.

Last modified 8 Feb 2021

Directors must consent to their appointment and are appointed by the company's shareholders (via a shareholders' meeting or by written resolution). In exceptional cases, directors can be appointed by having their names and dates included directly in the articles of association.

The appointment must be made by written resolution in notarised form. Details of the appointment must be filed with the companies register without undue delay. The respective director must also provide a specimen signature in notarised form to the companies register. The director's residential address and full date of birth are included on the record (which is open for public inspection). The notice to the companies register is to be signed in notarised form by as many directors as required (depending on whether a director can represent the company alone or together with another director).

Last modified 8 Feb 2021

Directors (i.e. members of the board of directors, supervisory board or sole directors) are appointed by the company’s shareholder(s) - via a general shareholders’ meeting or by unanimous written resolution. The articles of association may also provide that the board of directors may temporarily fill up a vacant mandate.

In the two-tier structure (public limited liability company), the members of the management board are appointed by the supervisory board.

In a private limited liability company, a director is in principle appointed for an unlimited duration, unless specified otherwise (i.e. for a specified duration).

In a public limited liability company, the members of the board of directors (in a one-tier structure) or members of the supervisory board (in a two-tier structure) are appointed by the shareholders for a maximum term of six years (which can be renewed an unlimited number of times). A sole director can be appointed for an unlimited duration, as can the members of the management board (in a two-tier structure).

For enforceability vis-à-vis third parties, the appointment decision needs to be filed and published in the Annexes to the Belgian State Gazette and details of the director need to be submitted with the clerk’s office for his registration in the Belgian Crossroads Bank for Enterprises (i.e. a director’s residential address and a copy of his/her passport or identity card).

Last modified 8 Feb 2021

The first directors of a private company must consent to their appointment and their names will be indicated in the company’s application for registration or in an amalgamation proposal.

All subsequent directors of the company shall, unless the constitution of the company otherwise provides, be appointed by ordinary resolution at a general meeting.

The court may appoint a director upon the application by a shareholder or creditor if:

  • There are no directors of a company, or the number of directors is less than the quorum required for a meeting of the board.
  • It is not possible or practicable to appoint directors in accordance with the company’s constitution.

Such appointment may be made on such terms and conditions as the court considers appropriate.

Details of the appointment must be filed at the Companies and Intellectual Property Authority within 14 days of the appointment taking place. A director's residential address and postal address are included on the public record.

Last modified 1 Mar 2021

Directors are appointed by the shareholders in a shareholders' meeting.

A director's term of appointment, which is set out in the bylaws, cannot exceed a three year term.  Directors may also be re-elected indefinitely. If the term of appointment for the board is not set in the bylaws, it will be one year.

There are certain special rules for the appointment of independent directors including, that they have to be proposed as director by shareholders that represent at least 1% or more of the company's shares.

Each corporation shall keep a public registry containing information about its president, directors, manager and other executives.

Additionally, in open corporations, public disclosure of a director's identity is required.

Last modified 5 Apr 2021

Directors of an s.r.o. are elected by the General Meeting or by the sole shareholder acting within the scope of the General Meeting. The registration of a director in the Commercial Register is only declaratory, and therefore the director may perform their duties and may represent the company from the date of the General Meeting's decision on their appointment, unless the decision determines the effectiveness of the appointment at a later date. Prior to or upon appointment, the director normally receives from the company a written draft management agreement concluded between the company and director, which regulates their mutual rights and obligations.

Last modified 8 Feb 2021

Members of the board of directors are elected by the shareholder(s) at the general meeting which may be held in person or by written resolution. The articles of association may include detailed provisions on the appointment of directors, such as allowing others to appoint directors.

The election of a director must be filed with the Danish Business Authority no later than two weeks after the election has taken place. If a director is foreign, the following information is required to be provided to the Danish Business Authority:

  • Copy of passport or an identity card.
  • Full name.
  • Residential address.
  • Information on citizenship at birth.

The name and residential address of a director will – as a starting point – be publicly available through the central business register’s website: CVR.dk.

Last modified 8 Feb 2021

Directors must consent to their appointment.

The members of the board can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution). The company's articles of association may stipulate that less than half of members of the board can be nominated by a specified party.

The managing director will be appointed by the board of directors.

Details of the appointment must be filed at the Trade Register without delay after the appointment takes place.  A director's residential address and full date of birth are not included on the public record but must be supplied to the registration authority.

Last modified 8 Feb 2021

In an SAS, the rules for the appointment of the directors (whether President, General Manager, Delegated General Manager or any other manager) are freely set out in the bylaws. Directors must consent to their appointment and certify that they are not bound with any judicial sanction preventing them from exercising such functions.

Usually, the bylaws provide that the shareholders are vested with the power to appoint managers (at least the President).

Any decision to appoint or replace the President or any other legal representative of an SAS must be filed (along with the residential address, full name and surname of the father and mother of the appointee, the certificate of absence of conviction and the copy of the identity card or passport) with the competent Trade and Companies Registry within one month of the relevant decision. The appointment/replacement decision will be publicly available. The commercial extract (publicly available) will include the name, date and place of birth and residential address of the legal representatives. The same publicity process can also apply (on an voluntary basis or upon request of the competent Trade and Companies Registry in certain cases) to managers who are not legal representatives of the SAS.

Last modified 8 Feb 2021

Corporate Body

The managing directors are generally appointed by a resolution of the shareholders’ meeting, either by a formal meeting or by a resolution in text form (including email). The articles of association may also allow for the passing of virtual resolutions or by telephone.

If the company has a supervisory board, the appointment of managing directors may be delegated to such supervisory board in the articles of association.

Form

Before the Covid-19 pandemic, in the absence of any respective allowance in the articles of association, a shareholders’ meeting could only be replaced by a resolution passed in text form if all shareholders agreed in text form either to the provision to be made or to the votes being cast in writing.

In order to ease formalities in the Covid-19 pandemic, German law now stipulates that shareholder resolutions may be adopted in text form or by casting votes in writing even without the consent of all shareholders. Such relief will expire on 31 December 2021.

Declaratory registration

The appointment of a new managing director must be filed with the commercial register of the company. The registration is merely declaratory and must be signed in a notarially certified form. Both the birthdate as well as the town and country of residence need to be declared and will be publicly available.

Last modified 8 Feb 2021

Directors must consent to their appointment and their appointments are governed by the company's articles of association. Normally they can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or the board may from time to time appoint a director to fill a casual vacancy or an additional director to the board. In the latter situation it is common for the articles of association to also provide that such director will only hold office until the next annual general meeting where he/she can stand for re-election.

With the exception of first directors, the company must deliver to the Companies Registrar a notice in the specified form (Form ND2A) within 15 days after the appointment of a director.

Last modified 8 Feb 2021

  • The first directors are designated in the articles of association of the company when the company is formed.
  • As a general rule, after the incorporation of the company, directors are elected and removed by the general meeting. In a wholly-owned company, the sole shareholder resolves on election and removal (this must be in writing).
  • Diverging from the above general rule, kfts and zrts may issue a preference business quota (kft) / share (zrt) that entitles its holder to appoint/remove one or more director(s) without the need for any action by the general meeting. No such preference share may be issued if a private company limited by shares is managed by a sole director (in lieu of a Board).
  • Appointment takes effect when the appointment is accepted by the person appointed and in accordance with the effective date set out in corporate resolution on the appointment. Accordingly, when the appointment is subsequently registered in the Hungarian companies register, the register will record the aforementioned date as the effective date of the appointment.
  • The directors must be registered in the companies register.

Last modified 8 Feb 2021

Directors must consent to their appointment and can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or, if the company's constitution allows, by the other directors.  In private subsidiary companies, the constitution commonly allows the parent company to appoint directors by a simple written notice to the company.

Details of the appointment must be filed with the Registrar of Companies within 14 days of the appointment taking place.  A director's residential address and full date of birth are included on the public record.

Last modified 8 Feb 2021

Directors must consent to their appointment and can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or, if the company's constitution allows, by the other directors.

For those SpAs that adopt a two-tier (dualistic) system, the supervisory board (Consiglio di Sorveglianza) appoints the members of the management board  (Consiglio di Gestione).

Moreover, in all SpAs it is possible that some directors are appointed by the holders of financial instruments or by public bodies; categories of shares may be assigned the right to appoint a certain number of directors and the state or a public body may have a direct right of appointment without causing the alteration of the participation’s percentages.

Details of the appointment must be filed at the companies register within 30 days of the appointment taking place. A director's residential address and full date of birth are not included on the public record but must be supplied to the register of Companies.

Limited liability companies’ by-laws can provide specific appointment rights.

Last modified 8 Feb 2021

Directors are appointed by a resolution of the shareholders in a general meeting.  Unless a higher majority is required under the articles of association, the shareholders' resolution may be passed by shareholders holding the majority of the voting rights present at the shareholders meeting, which is attended by shareholders holding the majority (this quorum may be reduced to one-third under the articles of incorporation) of the total voting rights held by shareholders entitled to vote.  Each candidate to be appointed by the shareholders' meeting must accept the position.

Appointment of a director shall be registered at the company’s corporate registry within two weeks of the assumption of office.

Last modified 8 Feb 2021

The first directors are appointed by the initial subscribers to the memorandum of association. Subsequent directors are appointed by shareholders through a resolution.

Directors must consent in writing to their appointment.

Typically, articles of association of private companies empower the Board to appoint a director to fill a casual vacancy or, subject to the prescribed number of prescribed in the articles, as an additional director. However, such appointments are placed before shareholders at the general meeting following the appointment for ratification.

The appointment of a director must be filed with the Registrar of Companies in the prescribed format within 14 days of the appointment and the register of directors maintained by the company updated with the particulars of such director.

Last modified 16 Jun 2021

Managers must consent to their appointment and are appointed by the shareholders of the company, for the first time at the incorporation of the company, and by shareholders’ resolutions during the life of the company.

Details of the appointment must be filed with the Luxembourg Trade and Companies Register (Registre de commerce et des sociétés – RCS) and filed with the Luxembourg electronic official gazette (Recueil  électronique des sociétés et associations - RESA) within one month of the appointment taking place.

A manager’s date and place of birth are not included on the public record but must be supplied to the Luxembourg Trade and Companies Register.

Last modified 8 Feb 2021

The directors are exclusively appointed by the general assembly through the competent deliberation of this corporate body and are appointed for the period established in company’s articles of association, which must not exceed four years. This term may be renewed one or more times.

The resolution appointing the company director(s) must be presented to the Legal Entities Registry for its record. The directors’ names and their mandate will be included in the company’s commercial registration certificate.

Last modified 19 Aug 2021

At incorporation of the company, directors are appointed in the notarial deed of incorporation.

After incorporation, the general meeting is authorised to appoint new directors, unless the company has installed a supervisory board pursuant to the Large Company Regime, in which case the authority to appoint directors can shift from the general meeting to the supervisory board.

For a BV, the articles of association may provide that a director may also be appointed by another corporate body of holders a certain class of shares.

Last modified 8 Feb 2021

Directors are required to consent to their appointment. The initial directors are be appointed in writing by the subscribers of the memorandum of association of the company or they can be named in the articles of association of the company. Subsequently, directors can be appointed by a vote at annual general meetings of the shareholders. Where a vacancy exists on the board as a result of death, resignation, retirement or removal, the board of directors may appoint a new director to fill such vacancy until the next annual general meeting, when such an appointment may be approved by the shareholders. If the appointment is not so approved, that person immediately ceases to be a director.

Details of the appointment must be filed at the Corporate Affairs Commission within 14 days of the appointment taking place. 

Last modified 1 Mar 2021

Directors are elected by the general meeting of the company. All shares have the right to vote at the general meeting unless they are considered non-voting shares pursuant to the articles of association.

The articles of association may provide that the general meeting’s right of election shall be transferred to others, but this is rarely used. More than half of the board of directors must in any case be elected by the general meeting unless the right to elect is assigned to a corporate body stipulated in the articles of association. The right of election may not be transferred to the board of directors or to a member of the board of directors.

The elected directors must be registered in the Norwegian Register of Business Enterprises. For the registration of non-Norwegian individuals, a certified passport copy, application for d-number (i.e. a personal identification number for foreign individuals) and a registration form must be filed with the Norwegian Register of Business Enterprises. The election of a new director is effective from the date of election by the general meeting.

The election of employee representatives is managed by an election committee (valgstyre), which is to be formally established by the company in collaboration with the employee representatives. The election must take place every second year.

Last modified 16 Jun 2021

Companies are required to elect their board of directors to ensure minority shareholders are represented. For such purpose, the law regulates the appointment of directors by the use of cumulative voting.

Cumulative voting allows shareholders, for each share held, as many votes as there are directors to be elected, and each shareholder may cast his/her votes in favour of one person or distribute them among several persons.

The persons who obtain the largest number of votes shall be appointed directors, following the order of votes in favour.

The cumulative voting process is not applicable when directors are elected unanimously by all the shareholders.

Last modified 26 Jul 2021

Management board members must consent to their appointment and, as a statutory rule, can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution). The articles of association may provide that a given entity (shareholder or any other person) is authorized to appoint management board members by a simple written notice to the company.

Details of appointment must be filed with the commercial register within seven days of the appointment taking place. A management board member's residential address is not included on the public record but must be supplied to the commercial register. By the same deadline, appointment should be filed with the electronic Central Register of Beneficial Owners (as a side note – such filing should be made by sending an electronic form which should be signed with a qualified electronic signature within the meaning of EU Regulation No 910/2014 (eIDAS Regulation) by one of the management board members in accordance with company’s rules of representation). Registration in the commercial register is only of informative nature and the appointment is effective upon the date that the company's shareholders resolution is adopted (or at the date indicated in the resolution itself).

Last modified 8 Feb 2021

Directors must be appointed by the company's shareholders (via a shareholders' general meeting or by unanimous written resolution).

A resolution appointing a director must be filed at the companies registry office within 60 days from the approval of the resolution. A director's residential address and the director’s Portuguese taxpayer number must be provided to the commercial registry office and are included in the commercial certificate of the company.

Directors must be appointed for the period fixed in company’s bylaws, which must not exceed four calendar years with re-appointment being permitted.

Last modified 8 Feb 2021

In the case of LLCs: Directors are appointed by the General Meeting of Shareholders (GMS), except for the first directors who are appointed through the Articles of Association (AoA).

In the case of JSCs:

  • With a one-tier system – the sole director/board of directors is appointed by the GMS, except for the first director/members of the board of directors, who are appointed through the AoA. If management duties are being delegated, the managers are appointed by the board of directors.
  • With a two-tier system – the sole manager/executive board is appointed by the supervisory board. The supervisory board is appointed by the GMS, except for the first members, who are appointed through the AoA.

For appointments to be binding on third parties, directors and managers have to be registered with the Trade Registry.

Last modified 8 Feb 2021

The Director is elected by the general participants meeting of the company, unless the Director's election is attributed to the BoD's competence under the charter. The appointment of the Director is subject to registration in the Unified State Register of Legal Entities.

The procedure of appointing BoD members is regulated by the company's charter.

Last modified 8 Feb 2021

Directors must consent to their appointment by signing a declaration of consent to act as director (Form 45) and a statement that they are not disqualified from acting as a director.

Directors can be appointed by:

  • The company's shareholders (via a shareholders' meeting or by written resolution).
  • As usually provided for in the constitution of a Singapore company, by the other directors (to fill a casual vacancy or as an additional director).

In private subsidiary companies, the constitution commonly allows the parent company to propose the appointment of directors by written notice to the company.

Details of the appointment (including details of shares that the directors have acquired or shares that are registered in the directors’ name) must be filed at the Accounting and Corporate Regulatory Authority of Singapore (ACRA). The ACRA must consent to the appointment before the individuals can be appointed as directors.  A director's residential address and identity numbers (i.e. NRIC / FIN numbers, as applicable) are available on the public record.

Last modified 8 Feb 2021

Directors are appointed if they:

  • Are elected by the shareholders of the company at a shareholder meeting or through a written resolution.
  • Hold a specific office, title or designation which automatically entitles them to be an ex officio director, if the company's memorandum of incorporation so provides.
  • Are nominated for direct appointment by certain shareholders, if the company's memorandum of incorporation so provides.
  • Are appointed by the board of directors to fill a vacancy (which appointment will be valid until the next annual general meeting of the company).

Each director must consent to their appointment in writing.

Details of the appointment must be filed at the Companies and Intellectual Property Commission within ten days of the appointment taking place.  A director's residential address and full date of birth together with a certified/notarised copy of their identity document or passport must be supplied with the filing.

Last modified 19 Apr 2021

Directors are appointed by the company’s shareholders, with effect from the acceptance of the concerned person.

The appointment of the directors, once accepted, must be filed for registration with the relevant Commercial Registry, stating the identity of those appointed and, in relation to the directors who have been assigned to represent the company, whether they can act individually or need to do so jointly.

Last modified 8 Feb 2021

Shareholders, in a general meeting, have the right to appoint members of a company's board of directors. In addition, the company's articles of association may provide that one or more directors are to be appointed in another manner (e.g. a bank providing debt financing to the company). However, the right to appoint directors may not be delegated to the board of directors or to an individual director.

The appointment must be duly registered with the Swedish Companies Registration Office. For the registration, a verified copy of the minutes of the shareholders' meeting and a notification form must be filed with the Swedish Companies Registration Office. If a director is not registered in the Swedish population register, a certified passport copy of that director is required for the registration. The appointment becomes effective from and including the date on which notification of appointment has been received by the Swedish Companies Registration Office or the later date stated in the decision on which the notification is based.

A managing director can be appointed by the company's board of directors (but it is not mandatory for a private company to appoint a managing director). If appointed, the appointment must be duly registered with the Swedish Companies Registration Office. For the registration, a notification form must be filed with the Swedish Companies Registration Office. If the managing director is not registered in the Swedish population register, a certified passport copy of the director is required for the registration. The appointment becomes effective from and including the date on which notification of appointment has been received by the Swedish Companies Registration Office or the later date stated in the decision on which the notification is based.

Last modified 8 Feb 2021

Directors must consent to their appointment and can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or, if the company's articles of associations allows, by the other directors.  In private subsidiary companies, the articles of association commonly allow the parent company to appoint directors by a simple written notice to the company.

Details of the appointment must be filed at the companies register within 14 days of the appointment taking place.  A director's residential address and full date of birth are not included on the public record but must be supplied to the registrar of companies.

Last modified 1 Mar 2021

Onshore UAE

Directors may be appointed by way of a written resolution of the shareholders of an LLC, which should be duly notarised by a UAE notary public. The relevant signatories of any shareholders that are body corporates must produce at the time of signing their applicable authorising instrument (such as a power of attorney or resolution) in order for them to execute the written resolution. Documents originating from outside of the UAE must be notarised, legalised and translated into Arabic for use in the UAE.

The name of the director may also be listed in the memorandum of association of the LLC, however this is not mandatory. To do so, the memorandum of association must be notarised by a notary public in the UAE. The same conditions apply as noted above with regard to evidencing authority to sign the memorandum of association.

Dubai Internationanal Financial Centre

The process for appointing a director entails the filing of an online request with the DIFC Registrar of Companies through the portal account of the company. This includes the submission of a director's declaration consenting to their appointment as well as a copy of a written shareholder's resolution approving the appointment. A certified copy of the new director's passport must also be provided in line with the DIFC Certification Policy.

Last modified 8 Feb 2021

Directors must consent to their appointment and can be appointed by the company's shareholders (via a shareholders' meeting or by written resolution) or, if the company's constitution allows, by the other directors.  In private subsidiary companies, the constitution commonly allows the parent company to appoint directors by a simple written notice to the company.

Details of the appointment must be filed at the companies register within 14 days of the appointment taking place.  A director's residential address and full date of birth are not included on the public record but must be supplied to the registrar of companies.

Last modified 8 Feb 2021

The company’s initial directors are generally appointed by written consent of the incorporator, and a director is generally removed, replaced or added to the board by a vote at an annual or special meeting of the stockholders or via a written consent of the stockholders. The company’s charter or by-laws typically permit the board to increase the size of the board (often subject to a maximum number) and to fill vacancies on the board, which effectively permits the board to appoint directors until the next meeting of stockholders at which directors are elected.  The names of directors are generally set forth in the annual report the company files with the applicable state authority in which the company is formed (for example, the annual report filed with the Delaware Secretary of State).

Last modified 8 Feb 2021

The director(s) are appointed by the general meeting of the shareholders. The director must be registered in the companies register. The information on the company’s director and the date of his/her appointment are publicly available at the website of the Ministry of Justice.

Last modified 8 Feb 2021

Directors are appointed individually at either a general meeting of a company or through a resolution. Directors must consent to their appointment.

Last modified 19 Apr 2021

Angola

Angola

What type of company is typically used in group structures?

In Angola, the most common type of company used in group structures is the private company limited by shares.  This guide therefore focuses on the management of private limited companies.

Last modified 1 Mar 2021

Angola

Angola

What is a "director"?

There is no complete definition of the term "director" in Angolan law.  Basically, the law regards someone who manages the affairs of a company on behalf of its shareholders as a director.

What are the different types of director?

Directors validly appointed as such, through a shareholders' resolution, may be executive or non-executive.

The executive directors are responsible for the management of the affairs of the company.

The non-executive directors are responsible for the general supervision of the performance of executive directors’ duties.

Last modified 1 Mar 2021

Angola

Angola

Who can be a director?

A director must be at least 18 years old.  In the event of a legal person being appointed as a director, it must appoint an individual to exercise the office in their own name. The legal person must share liability with the person appointed by it.

Foreign directors must hold a work visa, ordinary visa or residency card.

Minimum / maximum number of directors

Under Angolan law there is no maximum number of directors. The company’s articles of association may, however, specify a greater minimum number and/or specify a maximum.

The management of private limited companies is carried out by a board of directors, composed of an odd number of members.

It may be agreed in the articles of association that the management shall be exercised by one single director when:

  • The number of shareholders is only two (which can only happen in cases where the State, public companies or entities legally equivalent to the State hold the majority of the share capital).
  • The share capital does not exceed an amount equivalent, in national currency, to USD50,000.00.

Last modified 1 Mar 2021

Angola

Angola

How are directors appointed?

Directors must be appointed by the company's shareholders (via a shareholders' general meeting or by unanimous written resolution).

A resolution appointing a director must be filed at the company’s registry office.

Directors must be appointed for the period fixed in company’s bylaws, which must not exceed four calendar years with re-appointment being permitted.

How are directors removed?

Any member of the board of directors may be dismissed (either with cause, or without cause) at any time by means of a resolution approved by the company's shareholders (via a shareholders' general meeting or by unanimous written resolution).

A director may also resign at any time through the issuance of a resignation letter addressed to the Chairman of the board of directors, or in case of the resignation of the Chairman, to the company’s audit board or audit committee.

The resignation or the resolution on director’s dismissal must be filed at the commercial registry.

Last modified 1 Mar 2021

Angola

Angola

Typical management structure

Typically, the management of private limited companies is carried out by a board of directors and supervision by a supervisory board, made up of an odd number of members, elected by shareholders at a general meeting.

One of the directors is appointed as Chairman of the board of directors.

How are decisions made by directors?

The manner in which directors can make decisions is set out in the company's bylaws.  In private companies limited by shares, the bylaws typically provide directors with flexibility to determine between themselves how decisions are made – whether by physical meeting, telematic means (provided that the company ensures the authenticity of declarations and the security of communications, registering the content of all interventions) or an unanimous written resolution.

Directors must meet at least once a month, unless otherwise provided in company’s bylaws.

The validity of the resolutions of the board of directors depends on the presence of the majority of its members.

In relation to the minimum quorum, the board of directors must not approve resolutions without the absolute majority of votes of the directors present.

Authority and powers

The board of directors has exclusive and full powers to represent the company.

The powers of representation of the board of directors are performed jointly by the directors.

Acts performed by the directors, on behalf of the company and in the use of the powers conferred upon them by law, shall bind the company before third parties, irrespective of any limitations that may be established by the articles of association or by decisions of shareholders, whether published or not.

Directors shall bind the company if, by affixing their signature, they indicate that intention.

Delegation

Subject to Angolan law restrictions, and unless otherwise provided in the bylaws, the board of directors may delegate powers to one or more directors to deal with certain managing matters. However, the board retains overall responsibility for the company's operations and management.

The board of directors can also appoint attorneys to perform certain acts or categories of acts, without the need for an express contractual clause.

Last modified 1 Mar 2021

Angola

Angola

What are the key general duties of directors?

The key duties of a director are set out in the Angola Companies Law, pursuant to which the director:

  • Must observe a duty of care towards the company, demonstrate capability, technical competence and an understanding of the company's business considered appropriate for the role, and execute its tasks with the diligence of a careful and earnest manager.
  • Must observe a duty of loyalty towards the interests of the company, serving the long term collective interests of the shareholders and taking into consideration the interests of other stakeholders such as employees, clients and creditors by ensuring the sustainability of the company. As a specific realization of this duty, the directors must not pursue or develop, directly or indirectly, other activities in direct competition with the company, unless duly authorized by the general meeting of shareholders.
  • Must carry out any acts deemed necessary or appropriate to achieve the corporate purpose in line with the resolutions adopted by the shareholders, the bylaws and the applicable law.
  • Are responsible for drafting merger and spin-off plans, in addition to other documents required or appropriate for the full legal and economic transparency of the transaction, as well as preparing a report in case of change of the company's legal form (i.e. a change to a different type of company).
  • Are responsible for performing and executing all managing acts not specifically reserved by law or bylaws to the general meeting of shareholders.
  • Are responsible for, following a shareholders resolution (except an unlawful resolution or resolutions that are not compliant with the company's by-laws), taking all necessary measures to execute such resolution, as promptly as possible (namely resolutions making any amendments to the company’s bylaws).

In addition, if agreed by the shareholders and set out in the company’s bylaws, the directors must also decide on and implement:

  • The acquisition, disposal and encumbrance of real estate of the company.
  • The disposal, encumbrance and lease of the business establishment of the company.
  • The subscription or acquisition of other companies' shares or the disposal and/or encumbrance of these shares.
  • The establishment of subsidiaries, agencies, branches or other local forms of representation of the company.

In general, the directors are bound to manage a company in a professional and diligent way, which includes compliance with all legal, statutory and contractual requirements.

What are directors' other key obligations?

The directors are responsible for preparing the annual reports and accounts and other financial statements required by law in respect of each financial year, and must submit them to the general meeting of shareholders and supervisory board, within three months from the end of each financial year, or within five months for companies that submit consolidated accounts or that use the equity method.

The directors are also responsible of preparing and submitting a proposal for the allocation of profits and/or handling of losses to the shareholders, in respect of each financial year.

Transactions with the company

Whenever there is a conflict of interest between the company and a director, the director shall advise the Chairman of the board of directors and abstain from voting on the resolution concerning that conflict.

The company may only grant loans or credit to directors, make payments on their account, guarantee obligations that they have contracted or make advances to them on account of the respective remuneration, up to the limit of the monthly amount thereof.

Contracts signed between the company and its directors, directly or through another person, shall be null and void except if they have been previously authorised by means of a decision of the board of directors, in which the director concerned may not participate, and if they have obtained the favourable opinion of the supervisory board.

Last modified 1 Mar 2021

Angola

Angola

Breach of general duties

Directors are severally liable towards the company for the damages caused to the company as a result of their actions or omissions that are not compliant with their legal statutory or contractual obligations, unless they prove that their actions/omissions were not caused with intentional or negligent misconduct.

The directors may also be subject to criminal liability.

A lawsuit against the directors may be brought by:

  • The company – in this case a shareholder’s resolution to bring the lawsuit must be approved by the majority of the shareholders, and the lawsuit must be sought within six months from the date of such resolution.
  • In the absence of a lawsuit sought by the company, one or more shareholders who jointly own, at least, 10% of the share capital  may bring a liability suit against the directors to claim reparation for damages caused to the company.

A company may seek a range of remedies against a director for breach of duty including damages, recovery of misapplied property, accounting for profit made in breach of duty, an injunction to prevent breach and rescission of a contract.

Liabilities on insolvency

If during the course of its management the company goes bankrupt, the directors may incur in liability if the bankruptcy is declared fraudulent or culpable. The crime of fraudulent or culpable bankruptcy is punishable with a penalty of two to eight years' imprisonment.

Other key risks

Personal liability for directors may, in certain circumstances, arise under Angolan legislation including that relating to environmental and health and safety, employment, consumer protection and bribery/anti-corruption.  In certain cases, criminal liability may arise.

A director may also be disqualified by the court from acting as a director or from taking part in the promotion, formation or management of a company.  A disqualification order can be made for a variety of reasons (e.g. conviction for criminal offences relating to the running of a company, persistent breaches of statutory obligations such as filing documents with the companies register, being found liable for fraudulent or wrongful trading and generally for conduct which makes a director unfit to manage a company).

Last modified 1 Mar 2021

Angola

Angola

How can directors be protected from liability?

The board of directors or the shareholders' general meeting may declare null and void or annul defective resolutions, at the request of any director, shareholder with the right to vote or of the supervisory board, made within one year of becoming aware of the defect that serves as its basis.

The general meeting of shareholders may ratify any resolution or substitute an invalid resolution if it does not concern a matter that falls within the exclusive competence of the board of directors.

Directors shall not execute or allow to be executed resolutions of the board of directors that are null and void.

Directors' and officers' (D&O) insurance is also available. It typically provides both cover for individual directors against claims made against them in their capacity as director, including defence costs (which applies when indemnification by the company is not available), and company reimbursement when it has indemnified its directors (subject to an excess/retention). Policy exclusions typically include claims in respect of a director's fraud, dishonesty, wilful default or criminal behaviour.

What practical steps can directors take to avoid liability?

Directors should:

  • Keep informed about the affairs of the company, particularly its financial position, and compliance obligations. Directors should have access to up to date financial information, prepare thoroughly for and regularly attend board meetings and familiarise themselves with key legislation affecting the business.
  • Make full disclosures to the board and shareholders if they have outside positions or interests which may give rise to a conflict of interest and/or if they have a personal interest in any proposed or existing transaction or arrangement with the company.
  • Keep records and take advice – directors should ensure that full written records of board proceedings are made reflecting the reasoning behind key decisions. This should include any alternative courses of action considered. Minutes should also record any disagreement amongst the board and the reasons for that. In addition, directors should ensure that returns and accounts and filed promptly and take professional advice for decisions based on areas outside their personal expertise, for example from legal professionals and accountants.
  • Be aware of, and comply with, any group-wide governance policies. These may cover areas such as health and safety, ethics, bribery/anti-corruption, and human rights. Compliance with them is designed to help directors (and employees) fulfil their duties and obligations and minimise the risk of liability.
  • Act, not only with diligence, but also with loyalty, keeping in mind that they must act always in the interest of the company, taking into account the long-term interests of the shareholders and considering the interests of other subjects relevant to the sustainability of the company, such as its workers, customers and creditors.
  • Also in a group situation, directors should keep in mind that thet must act in the best interest of their group company. Whilst group interests and that company's interests are usually aligned, this may not always be the case (e.g. when their group company's solvency is adversely impacted).  It is important to keep communication and reporting lines as open and clear as possible between parent and subsidiary companies when issues may arise and seek appropriate advice.

Last modified 1 Mar 2021