Shareholder Disputes Shareholder Agreement & Company Charter

It is common practice for business investors, when setting up a joint venture or establishing a M&A project, to seek to protect their investment via a shareholder agreement and company charter.

These documents are often designed with the intention of imposing rules that the shareholders must follow and to allow non-default shareholder(s) to sue for damages (or any other available remedies) if there is a breach. Nevertheless, filing a lawsuit or arbitration claim amid a shareholder dispute is the least desirable action, regardless of how good your chances of winning are. Litigation proceedings will always be very time-consuming and, as the business may not be able to operate normally during the dispute, there is the potential that the company may collapse or be significantly damaged by the time the dispute is resolved.

Thus, when drafting shareholder agreements and company charters, the aim must be to minimize the possibility of such a situation from the outset, either by preventing the other side from breaching the agreement or ensuring that there remains enough control over the business to keep it running should a shareholder dispute arise.

Click HERE to view our full legal insight.

Contact Information:

LE & TRAN Building, No.9, Area 284, Nguyen Trong Tuyen St, Ward 10, Phu Nhuan District, HCMC Tel: (84 28) 38 42 12 42

Website: www.letranlaw.com

Email: info@letranlaw.com