lecture 4

Question 1

Who can be a director?

Answer 1

1. Have full legal capacity (at least 18 years old).
2. Additional restrictions- no bankruption, conflict of interest, certain crimes commited

Question 2

What is the difference between a one-tier and two-tier model?

Answer 2

One-tier model; Company is governed by a unified board who does both management and supervisory functions.
Two-tier model; Two distinct boards, one does management one does supervision. (act independently)

Question 3

What is the difference between the executive board and supervisory board?

Answer 3

Executive board: managing the company, actively involved in company’s bussiness decisions and plans.
supervisory board: oversee
and monitor the management board’s activities, focusing on major decisions to ensure they serve the company’s best interests.

Question 4

Are one-tier boards allowed?

Answer 4

UK: Yes!!
NL: allows one-tier model, but large companies must have two-tier model
GER: only small GMBHs can have one-tier model but all other companies must have two-tier model

Question 5

How are directors appointed?

Answer 5

Shareholders are usually responsible for the appointment of directors.
-see Articles of association
- can also be other corporate body

Question 6

How can directors be removed in england?

Answer 6

Directors can be removed in a similair manner as they are appointed.
-shareholders resolution

Question 7

How can directors be removed in the Netherlands?

Answer 7

Director can be suspended by same body that is empowered to appoint director.
-removed director can challenge this resolution.

Question 8

How can directors be removed in Germany?

Answer 8

GmbH:
shareholders resolution
AG:
- supervisory board can remove someone for gross breach of duty, unfit to perform or duty, vote of no confidence of shareholders.
=shareholder can only indirectly remove directors.

Question 9

Who represent the company?

Answer 9

1. The Managing directors
2. person that has been granted the right to represent the company (issuing power of attorney).

Question 10

is there a maximum term for directors

Answer 10

all jurisdictions: NO
except AGs in germany..

Question 11

How can directors resign?

Answer 11

A director’s resignation must be clearly communicated through a formal letter stating their last working day, in line with their labor contract. Once effective, the company is responsible for notifying the appropriate registry.

Question 11

Who is responsible for appointing directors in germany?

Answer 11

GmbH- generally made by the shareholders’ meeting, with the process often detailed in the
company’s articles of association.
AG- The supervisory board (Aufsichtsrat) is responsible for appointing members of the
Vorstand. (Maximum term: 5 years)