Shareholder's Individual Information Right: Prerequisites and Boundaries

Author:Andres Vutt, Margit Vutt

Every shareholder as an economic owner of a limited liability company must have the possibility of executing his rights in the company effectively. Therefore, the law confers on shareholders the right to obtain information. The shareholder’s right to information is considered to be the most important of his membership rights. Estonian courts have been able to form a set of basic principles of... (see full summary)

Andres Vutt Margit Vutt
Associate Professor PhD
of Commercial Law Adviser to the Civil Chamber
University of Tartu Supreme Court of Estonia
Shareholders’ Individual
Information Right:
Prerequisites and Boundaries
1. Introduction
Relations under company law are characterised by their multifacetedness – there are always numerous par-
ties involved in such legal relationships, and these relations are also multi-layered. Therefore, creation of
an appropriate system of all kind of remedies as well as creating an effective balance between the interests
of the company and its shareholders is quite a challenging task.*1 The choice of measures to protect share-
holders’ rights is also related to the question of whether and to what extent shareholders as the providers of
capital should have the right to check the use of the resources provided by them.*2
Being a shareholder of a limited liability company is always linked to certain property rights and expec-
tations – generally speaking, every shareholder is in the rst place interested in gaining dividends from
an investment he has made obtaining a share of a company. In addition to property rights, or, in fact, as a
prerequisite to proper execution of them, the law provides shareholders also other types of rights, the most
important of which is the right to obtain information.*3 Shareholders’ right to information is considered
to be the most important part, the very essence, of the so-called “membership rights”, because only an
informed member of a company can sensibly exercise his voting rights.*4
Optimal legal regulations therefore must provide proper balance between (sometimes malicious)
minority shareholders requiring too much disclosure, which can either burden the company unreasonably
or affect the con dentiality necessary to carry out business, and the actual need of the minority sharehold-
ers not involved in daily management to be properly informed. For a shareholder it is important to get infor-
mation that allows one to exercise membership rights; for the company, on the other hand, it is important
to block the claims that can be considered as harassment or that may otherwise cause signi cant damage
to the company.
This article aims to investigate the shareholder’s right to information from the point of view of a share-
holder as well as from the point of view of the company and to analyse whether Estonian law provides
1 About shareholder remedies in Estonia see also: M. Vutt. Systematics of Shareholder Remedies – Origins and Develop-
ments. – Juridica International 17/2010, p. 188
2 T. Laurer. US – Corporate Governance während einer feindlichen Übernahme – oder “der Revlon Auslöser”. – Zeitschrift
für Vergleichende Rechtswissenschaft. Archiv für Internationales Wirtschaftsrecht. 103. Band. August 2004, p. 317.
3 U. Hüffer. Aktiengesetz. Beck´sche Kurzkommentare. 9. Au age 2010, § 131, Rn 1.
4 W. Goette, M. Habersack, S. Kalss (Herausg). Münchener Kommentar zum Aktiengesetz. Band 2. 3. Au age 2008, § 131,
Rn 1; H. Fleischer, W. Goette (Herausg). Münchener Kommentar zum GmbH Gesetz. 1. Au age 2012, § 51a, Rn 5.

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