Liability vis à vis the company
Directors are jointly and severally liable vis à vis the company for unlawful actions or omissions resulting from a breach of their legal or contractual duties and which have caused damages to the company, except in the event that the director was not in attendance at the meeting when such a decision was taken or he/she voted against it. A claim may be brought by the company or, on its behalf, by shareholder(s) holding at least a 5% stake in the company (or 2% if the company is listed). The company is not required to prove that the conduct of the directors resulted from wilful misconduct or negligence, as there is a legal presumption to that effect.
Directors will not be liable if they are able to prove that they were properly informed, that no conflicts of interest existed and that the relevant decisions were based on rational criteria from a corporate/economic standpoint or if the unlawful actions or omissions of the directors resulted from a shareholders’ resolution.
Liability vis à vis the company’s creditors
If the directors have wilfully or negligently breached legal or contractual duties which are established for the protection of creditors, they may be liable vis à vis the company’s creditors if the assets of the company are insufficient to meet the company’s indebtedness towards its creditors. If no action is taken by the company or its shareholders (as a result of the mechanism described above), the company’s creditors may exercise the company’s rights and claim the relevant damages from the directors for the company.
Liability vis à vis shareholders or third parties
Directors may also be liable vis à vis shareholders or other third parties for any direct damages that may result from the performance of their functions as directors. In this case, directors shall only be liable if all general requirements for civil liability are met, i.e. there is an unlawful action or omission by the directors, the conduct is carried out with wilful misconduct or negligence, such action or omission has caused damages and there is a link between the action or omission and the damages. Third parties will include any party which is not the company, a director or a shareholder (while acting in such capacity) and may include employees, suppliers, clients, the State or any other creditors.
Liability arising from company’s tax debts
In the event a company has a liability under tax law, and the company does not possess enough assets to cover such liability, directors may be jointly and severally liable for any tax debt which derives from actions or facts occurring during their term in office.
In addition, directors may also be found criminally liable for such actions or facts.
Liability arising from labour credits
Directors may also be jointly and severally liable for the payment of labour credits arising from the labour relationship, its breach or termination, if they are overdue for more than 3 months, to the extent the requirements regarding liability vis à vis the company’s creditors or its shareholders/third parties, as provided above, apply.
Liability arising from social security and other labour administrative offences
Directors may be jointly and severally liable for the payment of the applicable administrative fines for social security and other labour administrative offences.
In addition to criminal liability deriving from tax debts, there are several actions that may result in criminal liability of the directors, including: (i) refusing to provide information relating to the preparation of shareholder meetings to interested parties; (ii) misrepresentation of company information to persons with a right to receive information; (iii) irregular issuance of share or bond certificates; or (iv) rendering the company insolvent (either as a result of wilful misconduct or negligence).