SHAREHOLDERS’ MEETINGS IN CORPORATIONS: KEY RULES IN BOLIVIA

The shareholders’ meeting is the highest decision-making authority in corporations (sociedades anónimas). From our law firm based in the Plurinational State of Bolivia, we provide a practical explanation of how meetings are called, who may participate, the required voting majorities, and how to challenge resolutions, all based on current regulations and corporate governance standards.

TYPES OF SHAREHOLDERS’ MEETINGS

When legally convened and held, the general meeting reflects the corporate will and its resolutions are binding on all shareholders. There are two main types:

Ordinary Meeting: Held at least once per year to review the annual report, financial statements, and supervisory report; decide on profits or losses; and appoint or remove directors and auditors, including setting their remuneration. It must be convened within three months after the end of the fiscal year when these matters are discussed.

Extraordinary Meeting: Deals with issues not covered in the ordinary meeting, such as amendments to the bylaws, issuance of shares or bonds, capital modifications, early dissolution, extension, transformation, merger, or appointment/remuneration of liquidators.

HOW TO LEGALLY CONVENE A SHAREHOLDERS’ MEETING

The call to meeting must be published at least seven days in advance in the Electronic Gazette of the Registry of Commerce. It must include:

Type of meeting (ordinary or extraordinary)
Location, date, and time
Agenda with specific topics (no vague terms)
Participation requirements

During this period, the registration of share transfers is suspended. If both the board and the supervisory body issue calls, the board’s call prevails, and all matters are consolidated into a single agenda.

SHAREHOLDER PARTICIPATION RIGHTS

Holders of registered shares participate if listed in the share registry. Bearer shareholders must deposit their shares with the company at least three days before the meeting or prove bank deposit. Receipts must identify class, series, and numbering, and the depository is liable for verifying the shares’ existence.

Shareholders representing at least 20% of voting capital may request a meeting in writing to address specific topics. If not convened within 15 days, the competent administrative authority will intervene, and the meeting will be chaired by a shareholder appointed by the shareholders themselves.

Even a single shareholder may request a meeting if none have been held for over one fiscal year or if mandatory items were omitted from previous meetings.

QUORUM, VOTING MAJORITIES, AND SECOND CALLS

First Call:

Ordinary Meeting: Requires attendance of more than 50% of shares with voting rights
Extraordinary Meeting: Requires two-thirds, unless the bylaws impose a higher threshold

Resolutions are adopted by absolute majority of valid votes. Voting must be secret if requested by at least 10% of the capital present. Additionally, 25% of shareholders may request a one-time deferral of voting for up to 30 days.

Second Call:

Ordinary Meeting: May proceed with any number of voting shareholders, if the notice specifies it is a second call
Extraordinary Meeting: Requires at least one-third of voting shares; resolutions are passed by absolute majority, unless stricter rules apply in the bylaws

LEGAL LIMITS TO SHAREHOLDERS’ MEETINGS

The agenda must list specific issues. Resolutions on matters not included are void, except for appointing minute signatories or when all shareholders are present and unanimous. Resolutions may not impair shareholders’ credit rights or remove statutory rights of minorities.

Any changes to the rights of a specific share class require approval by the holders of that class, following procedures established by law.

INFORMATION RIGHTS DURING SHAREHOLDERS’ MEETINGS

The meeting may be held without formal notice if 100% of voting capital is present. In this case, decisions require at least two-thirds of the votes.

Any shareholder has the right to request relevant information during the meeting to ensure transparency and informed decision-making.

HOW TO DRAFT AND REGISTER MEETING MINUTES

Minutes must include a summary of discussions, voting methods, results, and full resolutions. They must be signed within five days by the chair, the secretary, and two shareholder representatives. The minutes must also list attendees and the number of votes each holds.

For extraordinary meetings, a certified copy must be registered with the Registry of Commerce after notifying the relevant authority. Any shareholder may request a certified copy at their own expense.

CHALLENGING SHAREHOLDERS’ MEETING RESOLUTIONS

Resolutions may be challenged if they:

Violate the law, the bylaws, or public policy
Result from a meeting convened in breach of legal or statutory requirements

Eligible parties to challenge include directors, administrators, auditors, the regulatory authority, or any dissenting or absent shareholder. The time limit is 60 days from the meeting date or its official publication. A judge may annul the resolution and suspend the meeting’s effects until legal requirements are met.

Those who voted in favor of voided resolutions are jointly liable for the consequences. If a later meeting repeals the challenged resolution, the lawsuit ends, although liability for prior effects remains. Challenging shareholders must post a bond to cover potential damages and litigation outcomes.

BEST PRACTICES AND GOVERNANCE STANDARDS

Clear notices, specific agendas, sufficient information, and compliance with quorum and majority rules strengthen corporate governance. These practices align with Bolivia’s constitutional right to legal certainty, the American Convention on Human Rights, and the G20/OECD Principles of Corporate Governance.

In summary, general meetings promote transparency, protect minority shareholders, and provide effective mechanisms to challenge decisions. Following these guidelines helps prevent conflict, reduces nullity risks, and builds shareholder trust.

Our firm offers specialized legal services in corporate law and governance. If you are facing issues related to shareholder meetings, calls, deliberations, or legal challenges, contact us for a professional assessment.

Frequently Asked Questions (FAQs)

How often must an ordinary meeting be held?

At least once a year. When financial statements and appointments are on the agenda, it must be held within three months after the fiscal year-end.

Can a single shareholder request a meeting?

Yes, if no meetings have been held for over one fiscal year or if prior meetings omitted mandatory items like financial reports, profit distribution, or appointments.

What quorum is required for a first call?

For ordinary meetings: over 50% of voting capital. For extraordinary meetings: two-thirds, unless the bylaws require more.

Can voting be secret?

Yes, if requested by at least 10% of the present capital.

Is it possible to postpone a vote?

Yes. With 25% of the capital present, a vote may be postponed for up to 30 days, only once.

What is the deadline to challenge defective calls or resolutions?

Sixty days from the date of the meeting or its publication in the Electronic Gazette of the Registry of Commerce.

The content of this article does not reflect the technical opinion of Rigoberto Paredes & Associates and should not be considered a substitute for legal advice. The information presented herein corresponds to the date of publication and may be outdated at the time of reading. Rigoberto Paredes & Associates assumes no responsibility for keeping the information in this article up to date, as legal regulations may change over time.