The Legal 500

The outline concentrates on the management of the Joint-stock Company and the Limited Liability Company being the most commonly used forms of companies in Denmark.

The Danish Companies Act (in Danish: Selskabsloven) contains regulations as to the management of the Joint-stock Company (in Danish: Aktieselskab, abbreviated "A/S") and the Limited Liability Company (in Danish: Anpartsselskab, abbreviated "ApS").Shareholders' Meetings

The shareholders' right to make decisions concerning the company must be exercised at the general meetings. The general meetings can be attended by physical or electronical appearance in accordance with the articles of association.

Each shareholder is entitled to attend the general meetings and has the right to speak, and the shareholders are also entitled to attend the general meetings by proxy.

Unless otherwise agreed, each shareholder is entitled to vote at the general meetings and each share carries the same voting rights. The articles of association may provide that no voting rights shall pertain to certain shares or that the voting power of certain shares shall be increased.

An annual general meeting must be held in connection with the adoption and submission of the annual accounts. Extraordinary general meetings may be held at the request of any shareholder in a Limited Liability Company and from any shareholder in a Joint-stock Company holding more than 5 percent of the share capital or at the request of the board of directors (or the management board in Limited Liability Companies without a board of directors), the supervisory board or the auditor.

The board of directors (or the management board in Limited Liability Companies without a board of directors) must convene the general meetings in accordance with the requirements and time limits set out in the Companies Act and the articles of association. The requirements and time limits set out in the Companies Act may to some extent be exempted from in case of the shareholders' unanimous decision.

Management structure
The shareholders of the Joint-Stock Company and the Limited Liability Company may choose between different management structures. A Joint-stock Company shall be managed by a management board and either a board of directors or a supervisory board, whereas a Limited Liability Company in addition hereto may be managed by a management board alone.

Members of the board of directors, the supervisory board and the managing directors must be registered with the Danish Business Authority.

Composition
Joint-stock Companies must have a board of directors or a supervisory board made up of not less than three members.

There are no requirements regarding the nationality of the members of the management, and the members of the management are not obliged to reside in Denmark.

The majority of the members of the board of directors must be persons who are not members of the management board and a member of the management board cannot be appointed chairman of the board of directors. It further applies that a member of the supervisory board cannot be a member of the management board.

In Joint-stock Companies, the majority of the members of the board of directors or the supervisory board must be elected by the company at general meetings.

Function
Depending on the choice of management structure, the overall and strategic management of the company must be exercised by the board of directors or the management board. The supreme managerial body must in addition to this ensure a sound organization of the business of the company and ensure, among other things, the conditions regarding book-keeping and presentation of accounts, procedures for risk management and risk control and the financial position of the company, including its liquidity.

The supervisory board has the same function as the board of directors, but the supervisory board shall not carry out the overall and strategic management of the company.

The management board shall carry out the day-to-day business of the company subject to the directions and guidelines provided by the board of directors. If the management board is appointed by a supervisory board, the overall and strategic management of the company must also be carried out by the management board.

Liability
Members of the board of directors, the supervisory board and the managing directors may in the performance of their duties imposed on them by legislation be liable for damage to the company, the shareholders, the creditors or any third party if the damage is due to wilful misconduct or negligence. 

For more information please visit www.delacour.dk