As an introduction, it should be noted that the Law transposes Directive (EU) 2017/828 of the European Parliament and of the Council of 17 May 2017 into the Spanish legal system. This directive, as set forth in its grounds, was approved after nearly five years of negotiations between European institutions, which suggests the importance of the matters regulated.
A large part of the reform of the LSC affects listed companies, with a two-fold purpose: (i) improvements in the area of corporate governance and (ii) promote that shareholders participate more over the long term in the companies in which they invest by introducing what have been called “loyalty shares,” trying to avoid short-term investments that generate strong pressure for the governing bodies of the companies to obtain profits in the shortest time possible, thus harming the sustainability of the companies.
However, the reform also introduces other important modifications that affect non-listed companies, which are the majority. After a year in which, as a consequence of the pandemic due to COVID-19, instruments have been foreseen to enable attendance at or holding of meetings of the different corporate bodies by digital means also for limited liability companies (sociedades limitadas), the Law amends the LSC increasing the possibility to attend general shareholders’ meetings by digital means also for limited liability companies, when to date this type of attendance was only foreseen for the Spanish stock companies (sociedades anónimas). Furthermore, the reform introduces an important new possibility: that of holding exclusively digital general meetings under a series of premises. It is important to note that attendance and/or holding of the general meetings by digital means will only be possible if it is so foreseen in the company’s bylaws; thus, companies that wish to benefit from this new possibility must consider amending their bylaws if they have not already done so.
Another significant matter is the expansion of what must be understood by person related to the directors (persona vinculada a los administradores) and regulation of the approval of the execution of intragroup operations and the competent body for this. The new regulation promotes more transparency in relation to operations between companies of the same group when faced with a conflict of interest.
In conclusion, this is a highly significant reform affecting very diverse matters for companies, whether listed or not, and which implies quite novel changes that without a doubt will be received positively.