Spain

The law amending the Securities Market Law and implementing the ISD in Spain modifies some aspects of the Spanish Companies Law, and in particular amends the non-voting shares regime. The new regime makes the non-voting shares more attractive, especially for listed companies. It has the following main features:

Issue of non-voting shares

Stock companies may issue non-voting shares for a total face value of up to half its paid-up share capital.Legal privileges

Cumulative minimum dividend:

• holders of non-voting shares are entitled to receive a preferential yearly fixed or variable minimum dividend, in addition to the dividend distributed to the common shares;
  
• this dividend is to be established in the by-laws, the law having removed the 5% legal minimum;
  
• this dividend is mandatory and becomes cumulative if there is no, or not enough, profits and until it is fully paid;
  
• these shares are not affected by capital reductions made because of losses, unless the reduction exceeds the face value of the remaining common shares; and
  
• priority in the reimbursement of the paid-up value in case of the company's winding-up.
  Attribution of voting right
  

  In non-listed companies, the non-voting shares entitle holders to voting rights while the minimum dividend is not distributed. This however does not apply to listed companies.

  Pre-emptive rights With the new regime, the non-voting shares' pre-emptive rights in listed companies may be regulated in the company's by-laws. Luis de Carlos and Orson Alcocer

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