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The importance of shareholders’ agreements.

Why is it important for my company to have a shareholders’ agreement? Although the bylaws may be enough for some companies, in the presence of several shareholders with opposing interests it is useful to clearly stablish the rights and obligations among them. This type of agreement strengthens trust among shareholders and promotes investment in the company.

What is a shareholders’ agreement?

It is any agreement, different from the company’s bylaws, through which some or all the shareholders regulate their behavior within the company. In that sense, they agree on certain rights and obligations based on their stocks on the company, especially regarding their voting rights and the possibility to transfer their shares.

How can a shareholders’ agreement may be enforced against the other shareholders and the company in Colombia?

For a shareholders’ agreement to be enforceable against the company and the other shareholders, it must be legally valid, agreed on a written document, deposited in the company’s main office, and its term must not exceed ten years (which is extendable for subsequent 10-year periods).  Provided that these requirements are met, the shareholders’ agreement is valid and enforceable against the company and all the shareholders. Thus, if a resolution is passed in violation of the shareholders’ agreement, the complying shareholder(s) may challenge such resolution before the Superintendencia de Sociedades (Superintendence of Companies) and the votes casted in violation of the agreement will be disregarded.

How can shareholders’ agreement be useful?

Several goals can be achieved through this tool, such as: (i) provide different dividend distribution mechanisms; (ii) protect minority from controlling shareholders by agreeing in advance on how they will vote in certain scenarios; (iii) protect the shareholders from a bidder who wants to take over the company by allowing them to sell their shares at a fair market value (tag-along and drag-along rights); (iv) block the entrance of unwanted shareholders to the company by providing first refusal and preference rights, and by including call and put options; and (iv) protect a long-term business strategy, among others.

Are shareholders’ agreements different among the different types of companies?

Shareholders’ agreements in sociedades anónimas (public limited companies) may only regulate the way shareholders will vote and how they will be represented in their meetings. Furthermore, those shareholders who are also directors are prevented from signing these agreements.

On the contrary, regarding the sociedad por acciones simplificada (simplified private limited company), shareholders´ agreements may contain any legally valid provision. Not to mention, shareholders who hold directorships can also subscribe these agreements.

New winding-up cause

The Superintendencia de Sociedades (Superintendence of Companies) intends to eliminate non-operating (paper) companies by including article 91 in the bill that will introduce the Plan Nacional de Desarrollo for 2018 – 2022 (Development National Plan), which provides the following:

 “the companies supervised by the Superintendence of Companies which fail to renew their mercantile registry or to submit the annual required information to the Superintendence of Companies for three (3) consecutive years, will be deemed not-operational and may be unilaterally winded up by the Superintendence of Companies.” (Translation by CMS Rodríguez-Azuero).

Considering companies must renew their mercantile registry within the first three months of every year, this reform provides a new sanction in the form of a winding-up cause for those companies which fail to do it for three consecutive years.


Portrait ofJuan Camilo Rodríguez, LL.M.
Juan Camilo Rodríguez, LL.M.
Managing Partner
Andrea Zúñiga, LL.M.
Camilo Caicedo, LL.M.
Alejandro Restrepo
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