THE REFORM OF THE CAPITAL COMPANIES LAW AND OTHER FINANCIAL REGULATIONS. THE 10 KEY POINTS TO KNOW.

26 May THE REFORM OF THE CAPITAL COMPANIES LAW AND OTHER FINANCIAL REGULATIONS. THE 10 KEY POINTS TO KNOW.

On May 3, Law 5/2021 of April 12 came into force, modifying the revised text of the Capital Companies Law, approved by Royal Legislative Decree 1/2010, of July 2, and other regulations. financial institutions, in terms of fostering the long-term involvement of shareholders in listed companies, which is a step towards streamlining the standard for many aspects of their day-to-day operations.

The reform introduces very important elements affecting listed companies, which marks significant changes in their operation, and which improves, clarifies and limits the figure of agents and many of the practices that intervene in them.

These are the 10 key points to know:

1. The text allows the possibility of holding telematic meetings for capital companies, listed included. Undoubtedly, a requirement driven by the changes that the pandemic situation has generated and the measures related to the State of Alarm in which all of Europe has been.   For this, an approval of this possibility and its inclusion in the statutes is required . And in the case of listed companies, in addition to the participant identification systems, it is also mandatory for the partners to delegate or anticipate the vote and for the minutes of the Meeting to be drawn up before a notary public.
2. Listed companies may not appoint legal persons as directors.  Only those companies that belong to the public sector are included as an exception.
3. Listed companies will not have to publish quarterly financial information. However, the CNMV will have the power to require this information at its discretion for possible ex officio checks.
4. Changes in the regime of related-party transactions . In this regard, simpler rules are sought for approval, which must pass through the general meeting when the amount is equal to or greater than 10% of assets and in the Board of Directors in other cases. In addition, intra-group operations are simplified, clarifying incompatibilities for voting at home in one of the cases.
5. Double voting in listed companies.   Listed companies are granted shares with a loyalty vote, the value of which in the voting is double for each share held by the same shareholder for two consecutive years without interruption. Among other aspects, this possibility must be included in the statutes, double votes must be recorded in a register and the number of shares with double voting must be reported to the CNMV.
6. Right to know the identity of the ultimate beneficiaries . In compliance with the objective of transparency, the right is introduced, not only to know the identity of the shareholder, but, where appropriate, of the ultimate beneficiary, that is, the person on behalf of whom the intermediary entity legitimized as a shareholder acts. 
7. More transparency for institutional investors and asset managers. Asset managers (SGIIC and SGEIC) such as investment services companies and credit institutions that provide discretionary portfolio management services must make their way of acting and strategy explicit in their management processes.
8. The remuneration policy must be approved before the end of the last year of application of the current one. And, in addition, it is established that the Board will be the body in charge of supervising the remuneration of the directors.
9. Minimum for the bidder of a takeover bid. In this case, a minimum of 75% of the capital with voting rights of the affected company must be achieved so that it can exclude the company from the listing without having to make an exclusion bid.
10. Certain corporate governance obligations are rationalized and reviewed.