Voting Prohibitions in the Shareholders' Meeting (§ 47(4) GmbHG)

When resolutions are passed in the shareholders' meeting, no shareholder is to become a "judge in his own cause". In the law governing the GmbH, this is expressly regulated in § 47(4) of the German Limited Liability Companies Act (GmbHG). This principle applies correspondingly to other types of company (in particular stock corporations, limited partnerships, general partnerships and civil-law partnerships).

Under this statutory provision, a voting prohibition applies in the GmbH whenever a shareholder is to be discharged (entlastet) or released from a liability by the resolution, or where the resolution concerns the conclusion of a legal transaction with, or the initiation or settlement of legal proceedings against, a shareholder.

In the articles of association, voting prohibitions can be extended, specified and – at least in part – restricted. It is important that the provisions fit the specific company and the relationships between the shareholders. The articles of association should therefore (also) be carefully drafted in this respect.

What remains important: despite a voting prohibition, a shareholder has the right to attend the relevant shareholders' meeting.