The Constitutional Court found no 257 / 2008 Coll.
The Constitutional Court found of 27 March 2008 on the application for annulment of Sections 183i to 183n of Act No. 513 / 1991 Coll., Commercial Code, as amended
Valid
The Constitutional Tribunal found
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257
FIND
The Constitutional Court
On behalf of the Republic
The Constitutional Court decided on 27 March 2008 in plenary in the composition of František Duchoň, Vlasta Formánková, Vojen Güttler, Pavel Holländer, Ivana Jan, Vladimir Kořka, Dagmar Lastovecká, Jiří Mucha, Jan Musil, Jiří Nykodemí, Pavel Rychetský, Miloslav Excellent and Michaela Židlická in the matter of the Senate Group of the Parliament of the Czech Republic, for which Senator Sonya Paukertová, legally represented by JUDr. Petr Zimou, lawyer in Prague 2, Silesská 13, on the abolition of the provisions of § 183i to 183n of Act No. 513 / 1991 Coll., Commercial Code, for the participation of the Parliament of the Czech Republic and the Senate of Parliament of the Parliament of the Czech Republic as participants in the oral proceedings
as follows:
Motion denied.
Reasons
Recital of the applicant's proposal and argument
1. By a proposal delivered to the Constitutional Court on 16 November 2005, a group of Senators (hereinafter referred to as "the applicant") requested the annulment of the provisions of Sections 183i to 183n of Act No. 513 / 1991 Coll., Commercial Code, as amended, (hereinafter referred to as "the Obch."), which are included under the marginal heading "the right to purchase participating securities" (hereinafter referred to as "the right to purchase."). According to Article 35 (2) of Act No. 182 / 1993 Coll., on the Constitutional Court, as amended, hereinafter referred to as "the Law on the Constitutional Court '. The Constitutional Court was rejected by order of 8 December 2005, sp. zn. Pl. ÚS 53 / 05 (not published), since it was found that in the same case the Constitutional Court had already received a proposal from the Municipal Court in Prague to repeal Sections 183i to 183n of the Civil Code (hereinafter referred to as" o.s.'). In accordance with Article 35 (2) of the Law on the Constitutional Court, the appellant has become an intervener in the proceedings in sp. zn.
2. The appellant submitted his proposal again with reference to the novelty of the Act 377 / 2005 Coll., on the supplementary supervision of banks, savings and credit cooperatives, electronic money institutions, insurance companies and securities dealers in financial conglomerates, and on the amendment of certain other laws (Act on financial conglomerates), as compared to the draft sp. zn. It referred to the argument put forward in the previous submission in relation to the contested provisions of the Commercial Code.
3. The Law on the Constitutional Court does not explicitly address the question of the position of the appellant, whose proposal was rejected pursuant to Paragraph 35 (2) of that Law, and who therefore became an intervener in the earlier proceedings, in which case the application was rejected without having been de facto examined. In particular, where the appellant in the earlier proceedings is a court pursuant to Article 64 (3) of the Law on the Constitutional Court (specific control of constitutionality), it is not excluded that the Constitutional Court concludes that such a proposal does not comply with the conditions of Article 95 (2) of the Constitution of the Czech Republic (hereinafter referred to as "the Constitution ') and the previous application is rejected for the apparent illegality of the appellant, or there may be a situation where proceedings before the General Court which initiated the application pursuant to Article 95 (2) of the Constitution have been terminated. This would lead to a situation in the case of a later appellant where he would be deprived of the possibility of exercising his rights and defending his fundamental rights and freedoms. This situation in its decision-making practice was dealt with by the Constitutional Court by a legal structure according to which it considers the litispendence of litispendence to be lost (cf. sp. zn. In the present case, the Constitutional Court, by its order of 5 September 2006, sp. zn. At the same time, a new Judge-Rapporteur was appointed.
4. It is noted that, in the course of the proceedings conducted under sp. zn. Pl. ÚS 43 / 05 on 10 March 2006, 10 April 2006 and 4 September 2006, requests from J. H., J. N. and J. Č. to be granted the status of intervener under the provisions of § 63 and § 76 (3) of the Law on the Constitutional Court in connection with the application of the provisions of § 183i to 183n of the Act on the transfer of participating securities from their ownership to a shareholder who has fulfilled the conditions laid down in § 183i ("the main shareholder '). On 22 June 2006 the Constitutional Court received a letter from the Municipal Public Prosecutor in Prague, in which it stated that, in the legal case of the applicant, the application for the registration of the transfer of shares pursuant to Paragraph 183i of the Act entered into the Commercial Register within the meaning of Section 35 (1) (i) (c) of the Law of the Constitutional Court, such proposals were dealt with in the context of this procedure, stating that, in the proceedings for the annulment of the laws and other legislation, the Law on the Constitutional Court, except in cases arising from the procedure under Article 35 (2) of the Act, the intervening was not known. A party to proceedings before the Constitutional Court may be the party to whom the Law on the Constitutional Court refers (§ 28 (1) to (4)).
5. The appellant's argument of overshoot in the draft sp. zn. However, this proposal was further supplemented during the proceedings (whether under sp. zn. The argument was thus supplemented in the subsequent submissions of 5 January 2006, 18 April 2006 and 27 September 2006. Finally, the appellant summarised its proposals and arguments and supplemented it in its submission of 28 February 2007. This last submission was therefore taken as a basis for the summary and the arrangement of its arguments, bearing in mind the previous submission. The complaints against the adjustment of the forced purchase may be organised as follows:
(a) the appellant has included in the first group of defects discrepancies with the rules governing the purchase of securities, as contained in Directive 2004 / 25 / EC of the European Parliament and of the Council of the European Union Official Journal. Special edition 2004. Cap 17, St 002 ("the 13th Directive ');
(b) the second group, according to the appellant, consists of defects which conflict with the principles set out in the Convention for the Protection of Human Rights and Fundamental Freedoms ("the European Convention");
(c) the third group of defects constitutes conflicts with the provisions of international investment protection agreements;
(d) the fourth group of defects has been identified by the appellant as procedural defects;
(e) the remaining group includes defects which, according to the appellant, do not fall within the first to fourth groups.
6. As regards the objections to the application of the Community law to the law on redemption, the appellant contends in particular:
(a) incorrect taking over of Article 15 The 13th Directive, when, under the directive, two cumulative conditions are to be met - at least 90% of the share and at the same time at least 90% of the share in the voting rights and not just one of them;
(b) that the minority right to sell-out is not regulated, i.e. the right of the minority shareholder to redeem the majority shareholder's shares. In one of its previous submissions, the appellant pointed out that the right to buy-out ("squeeze-out ') and the right to buy-out (" sell-out') were complementary measures. The failure to implement the second institute was not justified in the Czech Republic, and it means thwarting the result prescribed by the directive. In this way, the other party, i.e. shareholders, who own 10% and less of the participating securities within the meaning of Article 183i (1) of the Act, is disadvantaged.
(c) At the time of adoption of the 13th Directive, the Czech Republic did not have an adjustment to the right to purchase listed shares. Therefore, it could not accept any adjustment to the right to purchase these shares, which would not follow the takeover offer. The basic rule is that the purchase can only follow the offer of the takeover (§ 183a obch. zák.). Exemptions shall be made only for those States which already had such an amendment at the time of the adoption of the 13th Directive;
(d) this is related to the non-implementation of the rule on the presumption of price correctness after the voluntary takeover offer. The takeover offer to prevent redemption is an important test of the proportionality of the share price. If the takeover bid has not been accepted, the consideration for the shares cannot be proportionate to the value of the shares;
(e) this follows the failure to ensure the condition of Article 15 (5) of the 13th Directive - guaranteeing a fair price. However, this is determined by the main shareholder and supported by the expert's expert opinion, selected and paid by the main shareholder. Valuation is always biased. There are no observable criteria in the law other than the terms "proportionality" and "justice," so the amount depends on the likes of the expert. The appellant referred here to divergent assessments which differ by several hundred percent.
7. The regulation of the right of redemption is also, according to the appellant, contrary to the European Convention. Such defects include:
(a) a contradiction with the principle of legality, which requires the accuracy, certainty and predictability of the rules (with reference to the sp. zn. Pl. ÚS 44 / 03 of 5 April 2005, Collection of finds and orders of the Constitutional Court, Volume 37, Found No. 73, published under No. 249 / 2005 Coll.), which does not meet § 183i of the Act. This provision does not contain only one element of uncertainty, but a whole range of - indefinitely adjusted length of the deadline to convene a general meeting, unclear definition of the type of procedure and required petit (to be determined, to be fulfilled), unclear regulation of the termination of the law, virtually limitation of the right to review the consideration in § 183k paragraph 2 and 3 of the order. (referring to the opinion of I. Stengl in the supplement to the 10th paragraph), unclear comments on the commercial law in the case of the court's non-validity of the general decision), unclear range of participants under § 183k margin., unclear rules on how to proceed with the possibility of other shareholders under § 183k paragraph 5. According to the appellant, the basic attributes of compensation for shares are unclear, since the concepts of "proportionality 'and" fairness of consideration' are subjective. All elements of uncertainty are in favour of the main shareholder when it is clearly described how to obtain shares. The procedure for the protection of minority shareholders' rights is described in a unclear or complete absence. However, their protection cannot be expected from the courts because of the overstretched formalism of general justice (Holländer, P.: Constitutional legal argument. Praha. Linde 2003, p. 77);
(b) a discrepancy with the requirement of public interest in adjusting the right of redemption. This is given for the right of redemption in the case of companies with listed shares made after the takeover offer, as it results from the underlying documents of the European Communities. However, the Czech legislature did not provide any justification for the public interest in cases which it had modified beyond the 13th Directive (purchase of unlisted shares and purchase of quoted shares carried out outside the takeover bid). The reason report on Mr Doležal's proposal does not exist, it merely referred to the 13th Directive. In the literature, the reason given by the public limited company to relieve the unnecessary costs of general meetings is misleading and irrelevant. According to the press, companies that have purchased shares are also reconsidering primary emissions.
(c) the absence of the possibility of provisionally (before the transfer of ownership of shares) to examine the legality of the company's practice in the exercise of the right of redemption. In the legal systems, which have as a precondition the right to register (such as Germany, Austria), there is a possibility to review the correctness of the company's practice - for example, whether the main shareholder actually has a sufficient number of shares, whether it is sufficiently documented, the proper assembly of the general meeting, the fulfilment of the conditions for the right of redemption, whether there is abuse of the right, etc. In this respect, according to the applicant, the Czech Republic is an exception (see § 131 obch. zák.).
8. The forced purchase of shares, according to the appellant, is contrary to international investment protection agreements, since there are also foreign persons in public limited companies. The appellant contends:
(a) measures for the withdrawal of the right of ownership must be reconsidered by the court both in relation to the investment and in terms of the accuracy of the valuation. However, in the register procedure, the court cannot review anything (§ 200da o. s.) and in the proceedings for annulment of the general meeting it is an obstacle to an effective review of the provisions of § 131 of the Act.
(b) the ambiguity which leads in practice to a mass determination of the amount of consideration at a date other than the date on which the expropriation was notified. The compensation under these agreements is to be equal to the market value of the expropriated investment immediately before the expropriation decision was notified. However, in all known redemption cases, the value of the shares was set at the so-called operative date several months before the decision was notified. This also contradicts Article 61 (2) of the Act.
(c) the absence of remuneration from the date of expropriation to the date of payment.
9. In particular, the appellant sees procedural defects in the lack of respect for the principle of equality of arms, the protection of the weaker and access to justice. It identified as specific deficiencies:
(a) the absence of a guarantee that the measure leading to the displacement will in fact be examined by a court in a contractual and public process. Nothing in the register procedure is examined and the expropriated shareholder is not a party to the proceedings. In addition, with the aid of § 131 of the Act, there is always a reason to stop the proceedings or dismiss the action. Even if the action by a minority shareholder is lawful, the original situation may not be restituted when there is a fait accompli created by registration in the Commercial Register. The Court of First Instance, which will rule on the matter, will base itself on the situation created and, in view of the principle of legal certainty and the protection of the rights of third parties, will have a tendency to reject the proposal to review the resolution of the General Meeting. Therefore, a review should take place prior to the transfer of ownership, as in a number of other States, even if it is linked to the activity of minority shareholders (Netherlands, United Kingdom, Sweden), or depending on the court's reasoning (Germany, Austria). In the Czech Republic this review is excluded according to § 131 (3) obch. zák. Furthermore, the principle of the protection of the weaker party is not respected in the review of the level of remuneration. This procedure is therefore burdened with defects that violate the principle of proportionality.
(b) failure to respect the principle of equality of arms in the examination of the level of consideration. According to § 183k of the Act, the minority shareholder will be given the floor only when he has obstacles such as an expert opinion, the opinion of the Czech National Bank and registration in the Commercial Register without being able to participate or participate in the proceedings;
(c) the significant information deficit of minority shareholders as regards the state of the company's assets and the likely future economic results on which the assessment is usually based. This results in the inequality of arms in the review procedure, when the rule is that most of the assessments are based on the documents of the board of directors;
(d) it sees as a fundamental defect the principle that the court is governed only by the applicant's proposal in the review procedure. It has little information enabling it to quantify the correct amount of remuneration within a short period of time. In conjunction with the allocation of costs to the respondent, this is another obstacle to the exercise of his right. For example, in Germany, under the so-called Spruchverfahren, the shareholder is not forced to quantify the amount of the claim;
(e) the burden of proof therefore does not, unlike foreign adjustments (Germany, Austria), pass on to the principal shareholder;
(f) the costs of the proceedings are borne by the minority shareholder, which is another obstacle to the exercise of the right in court. Thus, the adjustment of costs has a deterrent effect. In the original proposal, this view was further advanced by the appellant in that, contrary to his will, the expropriated shareholder would be forced to bear the costs of the review procedure under certain commentators of the Commercial Code, while paying the higher the legal fee, the more the main shareholder, in cooperation with the expert, would "cheat" in determining the remuneration. If, moreover, the inadequacy of the remuneration is excluded from the action for annulment of the order of the General Assembly (Section 183k (5) of the General Court Act.), the action for annulment of the General Assembly must be replaced by a procedure which takes place in a similar procedure or in a procedure which will not further impair the status of the person expropriated. Otherwise, it is not possible to talk about the fact that the review procedure is a procedure which, in the sense of the adequacy of legal protection, replaces the nullity procedure of the General Assembly resolution. Here, the appellant referred to an example of the German regulation that the costs of the so-called review procedure (Spruchverfahren) are essentially borne by the main shareholder;
(g) the absence of any effective protection outside standing shareholders when the Joint Representative Institute is not modified and their information on the outcome is not regulated;
(h) the need to sue abroad if the main shareholder is a foreign person. This is another burden and an insurmountable obstacle for most minority shareholders.
10. Among the remaining defects in the right of redemption, the applicant stated:
(a) the fact that it is a private-law relationship where the principle of formal equality should be respected. Nevertheless, the law gives the main shareholder the right to unilaterally adjust the relationship between them - the level of remuneration is decided by the expert hired and paid by the main shareholder, minority shareholders are given the floor in the contractual proceedings after all important decisions have been taken by the general meeting and reviewed by the notary, expert, Czech National Bank. The dialogue on the correct level of performance is thus carried out between the main shareholder and the expert hired by him and the public authorities. Only then does a minority shareholder get the floor;
(b) Paragraph 183i of the Act, which does not allow for the effective exercise of the right to supplement the consideration. The current legislation does not give the distressed shareholders the opportunity to learn about the conduct of the dispute. In the original application, the appellant stated in this connection that, although civil proceedings are public, decisions of the courts in commercial matters are not normally published (except in the case of unfair competition). If the law resulting from the provisions of Paragraph 183k (3) of the Act were to apply, the other beneficiaries would first have to be informed of the other amounts of compensation. Since the law does not provide any mechanism for the publication of a decision, the majority of beneficiaries are merely a formal right which cannot be effectively exercised;
(c) failure to respect the rights of lien creditors by which the Commercial Code does not grant the right to a procedure under Paragraph 183k (3) of the Act.
11. Thus, the legislation does not motivate the main shareholder to behave fairly, since it is not affected in any way for acts contrary to good manners. The only risk is that it may have to pay off to several shareholders who have sufficient resources to conduct a dispute over consideration before the formal judges considering it. The requirement of legality and proportionality in the transfer of shares, in the procedure for reviewing the legality of the transition measures, and in the determination and examination of the level of remuneration is not respected.
12. Finally, as a new argument, the appellant added his motion to the objection that Mr Doležal's proposal, which brought the right of redemption into our legislation, was marked as an amendment, although, in the light of the Constitutional Court's finding, Pol. ÚS 77 / 06 (see below), given the content and purpose of the original draft law, it could not have been one. The content and purpose of both proposals differ diametrically (regulation of the business register and the right of redemption). At the same time, Mr Doležala's amendment does not contain any amendment, amendment or deletion of any provision proposed by Mr Pospíšil. The adjustment of an absolutely fundamental question was thus made by means of the adhesive.
13. For all the above reasons, the appellant therefore requests the withdrawal of the law on redemption, since the effect of the fundamental defects of the sub-sections 6 to 11, as well as the shortcomings of the legislative procedure, makes the legislation unconstitutional. It should be noted here that the final submission, which was intended to summarise the appellant's argument, does not contain a single specifically argued complaint of the inconstitutionality of the contested legislation of the law of forced redemption. It was therefore necessary to take into account the original proposal of the appellant under the sp. zn.
14. In addition to the summary, the following constitutional arguments were included in the original proposal. According to the applicant, the law on the right of redemption contained in Sections 183i to 183n of the Act is to constitute the procedure laid down in Article 11 (4) of the Charter; it is an expropriation in the form of the withdrawal of shares to existing owners for the benefit of another entity. The fact that, in similar cases, the withdrawal of shares for compensation is an act of interference with property law, which has been ruled by a number of European courts. In this context, the appellant noted that the law on the right of redemption did not fulfil the conditions laid down in Articles 11 (4) and 4 (4) of the Charter and Article 1 of the Constitution. This was justified by the fact that the issue of the so-called buyout of securities against the will of their owners, in particular the question of compensation for expropriation, is regulated in a way that makes it virtually impossible for expropriated investors to defend themselves effectively against abuse of law and thus puts them in a completely unequal position (see below). These investors do not have sufficient time to prepare for the general meeting and to decide whether the level of remuneration is set at the correct level. Furthermore, investors are in no way protected against abuse of rights in the context of the assembly of the general meeting, the process of determining the amount of the remuneration and its remuneration allows for the libel of the main shareholder and creates the inequality of the parties to legal relations, the process of reviewing the accuracy or proportionality of the remuneration is not controlled by clear and comprehensible rules, the registration procedure does not provide them with protection.
15. Even if this is not an expropriation, the expropriation act of the State is taking place. The transfer of ownership cannot take place without registration in the Commercial Register, i.e. without an act of the State. However, according to the appellant of the decisions cited by the European Court of Human Rights, expropriation is involved (e.g. James and others against the United Kingdom of 1986) as this is subordinate to the second rule of the second sentence of Article 1 of the Second Additional Protocol to the European Convention. Therefore, James and others have to be much more involved in adjusting the right to buy-out, since the role of the State (registration in the commercial register) is much more significant in this case. Moreover, the label is not as important as the role of the state. It is absurd to think that, in the event of the withdrawal of assets for the benefit of the State (expropriation), an investor would deserve greater protection than in the event of withdrawal for another private investor. This difference can be evidenced by the new regulation in Act No. 184 / 2006 Coll., on the withdrawal or limitation of property rights to land or construction (Expropriation Act). While it may be accepted that the right to shares does not enjoy the same protection as ownership of other things, this does not mean that shareholders expropriated under Paragraph 183i et seq. of the Act should have almost no rights and guarantees.
16. As regards the time limit for the meeting of the General Meeting, there is a considerable contradiction in the comments made to date on this issue as to whether it is possible to shorten the period between the date of notification and the date of the General Meeting for a period of less than 30 days. According to one of the opinions, the provisions of § 181 (1) and (2) of the Act should apply to the case and therefore the legal period of 30 days between the date of notification and the date of the General Meeting referred to in § 184 (4) of the Act may be reduced to 15 days. However, Paragraph 181 (1) of the Act, which allows the General Meeting to be convened within a shorter period of time, does not cover the cases foreseen in § 183i et seq.
(a) Paragraph 183i (1) of the Act expressly refers to the "General Meeting," whereas Article 181 of the General Meeting of the General Assembly. "Therefore, the provisions of Article 181 of the Act cannot be applied to the procedure laid down in Article 183i of the Act.
(b) Another reason for this is the nature of the provision of Paragraph 181 of the Act, which is intended to protect the minority and not to make life easier for majority shareholders (here he pointed out the view of Havel B.-He finished T.: And again the squeeze-out: Consideration of the interpretation of § 183i et al. ObchZ, Legal Divisions, 2005, p. 17, p. 634-635). Paragraph 181 of the Act also seeks to speed up the procedure for cases where the company's management needs to be quickly intervened or where information from the Board of Directors is to be obtained quickly. This is not the case, however, in Article 183i of the Act, where neither the company nor the main shareholder is in any time pressure and where, on the contrary, sufficient time must be given to the expropriated shareholders;
(c) nowhere in the provisions relating to the purchase of securities is reference to the provisions of Paragraph 181 of the Act. Clause § 183j obch. zak. je lex specialis k § 184 (4) obch. zák. Similarly, the provision of § 181 of the Act of Law lex specialis in relation to the provision of § 184 (4) of the Act. It is clear from the above that both the provisions of Section 181 of the Act and the provisions of Section 183j of the Act are special provisions in relation to the general provision of Section 184 (4) of the Act. No special relationship can be established between the provisions of Sections 181 and 183i and the subsequent amendments.
(d) minority shareholders shall, in the case of a compulsory purchase of shares in the position of expropriated persons, be deprived against their will of their ownership of shares. The requirement of sufficient time to prepare for the general meeting should therefore be accentuated in this case and not suppressed in favour of the expropriating main shareholder.
According to the appellant, there are also views of important experts, which are quite the opposite. This proves that the legislation is unclear, vague and confusing in this respect and does not meet the requirements laid down for the rule of law in Article 1 of the Constitution.
17. The appellant also criticised the determination of the level of remuneration. The view of objectivity in determining the amount of consideration is created by the legislator by the involvement of experts in the process of determining its amount. The essence of any modern society is the law of voluntary transfer of ownership. Involuntary transfer of ownership is an exception to which there must always be clear and strict rules. This does not comply with the provisions of § 183i and the following bylaws. The contractual price arrangement is replaced by a unilateral setting of the "purchase price" (here consideration) by the main shareholder. If the agreement of one of the parties is to be replaced by a decision of the other party to the transaction by an involuntary or unwanted transaction with a transfer price, the evidence of the accuracy and objectivity of the expert's assessment must comply with strict criteria of objectivity both in terms of the choice of the expert, the conduct of the expert's assessment and the possibility of its examination. However, in the case of squeeze-out, the expert shall determine for that purpose the main shareholder himself, and shall also determine for the expert the amount of his remuneration (Paragraph 183j (6) of the Act). This, of course, must and has an impact on the question of the expert's dependence or independence. It is no longer guaranteed that the main shareholder must respect the expert's possible disapproval. For this reason, the expert "proof 'of the price is purely formal in nature without practical importance for the protection of expropriated investors and does not constitute any protection of the rights of expropriated persons. Any objection that the expert is responsible for the faulty assessment and that he is responsible for the damage caused will not stand, given the values in play.
18. Payment of the remuneration for the purchase is not sufficiently secured. The original provision in this respect (Section 183m (5) of the Act on Financial Conglomerates) was repealed. That law introduced an obligation to deposit the amount of consideration on an account with a bank or a securities trader. Even this new element does not sufficiently ensure payment of the remuneration set by the main shareholder. Under the term "bank" you can understand any bank, i.e. even a bank operating in a jurisdiction not available to Czech shareholders. In addition, the amendment implemented by the Finance Conglomerates Act transmits the obligation to provide remuneration from the person of the main shareholder (see the applicable wording of Sections 183m (3) and (4) of the Act on Financial Conglomerates) to a securities trader or to a bank. This gives rise to further legal uncertainty as to who is actually the carrier of the obligation to "pay back." Logically, he should be the main shareholder. According to the current wording of Section 183m (3) and (4) of the Act, "the remuneration of a securities dealer or a bank shall be granted," that is to say, as if the latter had this obligation. It is clearly unfair to the beneficiaries who are deprived of the fundamental (ownership) right to be subjected by the legislator to such a high degree of uncertainty about the above mentioned matters. It is not reasonable that this considerable discrepancies of the law and its ambiguity in a situation where the fundamental right to peaceful use of property to hundreds of thousands of citizens is removed should be addressed by case law.
19. In particular, there is a unclear definition of the heading of the parties (sub (a), the type of procedure (sub (b), the application (sub (c)) and the termination of the right to rely on inadequacy.
(a) The text of the Commercial Code does not make it clear that the parties to the review proceedings are involved. It follows from the logic of the case that the appellant (one of the minority shareholders) and the main shareholder should be a party to the proceedings. However, this is not explicitly stated anywhere, and the provisions of Paragraph 183k (3) of the Act provide that "a court decision is binding on the principal shareholder and the company in its entirety... '. According to that provision, the addressee of the judgment is therefore both the court and the company. If only the main shareholder were to be a party to the proceedings, that sentence would not make sense. It is not clear at all what role society is to play in this proceeding. The new wording of Section 183m (3) and (4) of the Act on financial conglomerates is followed by a securities dealer or a bank;
(b) Paragraph 183k (1) of the Act does not address the issue of the type of procedure in its text. From the words "may... ask the court to examine the proportionality of the remuneration" it is not possible to deduce whether the proceedings are disputed or not. Should an analogy be applied to the provisions of § 220p (4) of the Act, where "the right to request an examination of the proportionality of the remuneration 'in relation to the transfer of capital is also provided for, it should be noted that this provision is also unclear. In its decision No 8 Cmo 171 / 2005-731, the Supreme Court in Olomouc stated that the procedure for examining a reasonable settlement was undisputed. On the contrary, the Supreme Court in Prague considers that the proceedings are questionable. The appellant is of the opinion that it is not possible to leave it to the development of case law, but that it must be adapted precisely in the sense of the requirements imposed on the rule of law (Article 1 of the Constitution), such a serious issue as the determination of the type of procedure on matters where citizens are deprived against their will;
(c) it is not clear from the text of the provision of Paragraph 183k (1) of the Act whether the operative part is to be fulfilled, determined or otherwise. Paragraph 183k (3) of the Act tells mysteriously about "granting the right to a different amount of consideration," paragraph 4 refers to "determining inadequacy." Thus, the law does not give a clear answer to the question of the type of application. The problem cannot be removed even if the analogy with § 220p obch. zak were used. Nor is it clear from the text of § 220p (4) of the Act, i.e. from the words "right to request a review of the amount of settlement in money ', what type of proposal is involved (for performance, for determination or otherwise). In practice it is also possible to find various interpretations, as demonstrated by the appellant by the example of an opinion in the literature, when Heir J. and others mentioned in the Commercial Code, Comments, Polygon 2002, Volume II, p. 2865, that this is a performance claim, whereas § 17 (1) of Act No. 627 / 2004 Coll., on a European company, as amended, refers to a determination action. It follows that, in the case of Article 183i of the Act, it is an indefinite provision which does not meet the criteria of accuracy, certainty and predictability defined by the Constitutional Court in the case sp. zn. The same applies therefore to the provisions of Paragraph 183k of the Act.
(d) Paragraph 183k (2) of the Act provides for the right to invoke a disproportionate remuneration. Paragraph 183k (3) of the last sentence of the Act provides, on the other hand, for the start of the limitation period in respect of all beneficiaries, whether they were parties. The term "all beneficiaries' is not defined and must be interpreted as a set of holders of participating securities. If only those who made subsequent or simultaneous proposals for review were to be taken into account, then the words' whether or not they were parties' would lack meaning. The resulting effect of the two provisions cited is therefore (a) either the absurd fact that the right will first cease to exist (because the beneficiary does not submit a review proposal and as a result there is no procedure to which he would be a party), and after it has ceased to exist, it is likely that the limitation period from the moment of the legal power of the decision given on the application of another beneficiary, (b) or two different rights, namely the right to review (which will expire if none of the beneficiaries submit a review proposal) and the right to a supplement (which is likely to be suspended within a general limitation period). The absurdity of the above condition is also pointed out by the authors of the Comments to the Commercial Code Stenglová I. and spol. (Supplement to the 10th edition of Comments C. H. Beck, p. 88).
20. Pursuant to Article 4 (4) of the Charter, when applying the provisions on the limits of fundamental rights and freedoms, the substance and the meaning of those rights must be investigated. This means, inter alia, that the legislation associated with the limitation of the fundamental right (here the right to peaceful use of property) must meet high requirements for clarity, clarity and predictability (see the decision of the Constitutional Court in the case sp. zn. This rule must be applied doubly if it is an intervention consisting of a complete withdrawal of the right of ownership. In addition, it is necessary that persons whose fundamental right is affected should not be unduly burdened in the context of a procedure to review the compensation for expropriation. In this context, the appellant raised arguments which, in his view, express these deficiencies. Therefore, it is wrong to leave the law to the case-law of the courts to remove inaccuracies and ambiguities when they are accumulated at a single institution to such an extent in matters affecting the fundamental rights of citizens, given the constitutional principle set out in Article 4 (4) of the Charter. The law on the crowding-out of minority shareholders does not meet the requirement of proportionality between the means used to limit (withdraw) ownership and the objective pursued. There is also no examination of the substance and the meaning of the basic law (Article 4 (4) of the Charter). Some individual discrepancies or ambiguities in the current legislation would appear to be possible to eliminate by constitutional conformance (e.g. type of management or type of proposal). But a whole series of ambiguities cannot be eliminated by a constitutional interpretation. Even if it were possible, it is unfair that the burden of removing such serious uncertainties of the law and to the extent that they occur in the provisions of Sections 183i to 183n of the Act should be borne by one whose rights should, on the contrary, be investigated by the legislator within the meaning of Article 4 (4) of the Charter. The appellant is convinced that it is inadmissible and contrary to the provisions of Article 4 (4) of the Charter, that any risks related to the regulation of the law governing the purchase of participating securities should have been investigated when adopting the provisions on the limits of fundamental rights, i.e. a minority investor.
21. Finally, the appellant's objections regarding the role of the Czech National Bank (originally the Securities Commission - the appellant did not change that designation) should be raised. In his view, the amendment to the redemption right by the Finance Conglomerates Act does not, in particular, remove the argument that there is no objective determination of the amount of remuneration (which could be objectively replaced by the process of negotiating the purchase price), for the following reasons:
(a) the Securities Commission itself has publicly stated that it is unable to assess the adequacy of settlement, in particular for unlisted companies (see KCP press releases);
(b) for the procedure of the Securities Commission, the amendments made by Act No. 377 / 2005 Coll. apply mutatis mutandis to the fiction referred to in § 183e of the Act. According to this provision: If, within the time limit referred to in paragraph 8 (i.e. within 8 days - extended to 15 working days), the Securities Commission does not send the applicant its opinion on the content of the takeover offer or, if necessary within that time limit, does not give the required consent to the acquisition of the participating securities to the target company or prohibit the takeover offer, the latter shall agree to the takeover offer. It is therefore not a measure that would address the problem of objectively determining the level of remuneration effectively, since a review by the Securities Commission may not take place at all in a number of cases (in particular for unlisted companies).
(c) Comments on the Commercial Code - Supplement to the 10th edition, C. H. Beck Praha, 2005, p. 83, states that it is not necessary to have prior approval of the Securities Commission for unlisted shares at all. Thus, such securities would not have been objectively assessed at all. However, even if the Securities Commission had the power to supervise the amount of consideration for unquoted securities, it is not equipped with any powers whatsoever to request from unquoted equity companies any information on the basis of which it could carry out the review.
22. As regards the appellant's objections to the regulation of the registration procedure, the Constitutional Court ruled out their settlement for proceedings under the sp. zn.
Observations of the parties
23. In the light of the course of the proceedings in the present case, the Constitutional Court requested the parties' observations on the application for annulment of Sections 183i to 183n of the Act twice. This was the case for the first time in the context of the proceedings under the sp. zn.
24. The President of the Chamber of Deputies of the Parliament of the Czech Republic, in a statement dated 16 November 2005, described the procedure for adopting Act No. 216 / 2005 Coll. and stated that the legislature acted in accordance with the legal procedure when negotiating the contested law and expressed his vote that the adopted law did not conflict with the constitutional order of the Czech Republic. At the same time, he added the text of Mr Doležal's amendment, the amendments - press 566 / 4, the approved text of the law - press 566 / 5, the third reading stenographic record of 9 February 2004 and the resolution of the Chamber of Deputies No 1457 and No 1626.
25. In his observations of 16 November 2005, the President of the Senate of the Parliament of the Czech Republic described the procedure for discussing the draft law by the Senate of the Parliament of the Czech Republic. As regards the contested provisions of § 183i to 183n of the General Tax Code, he pointed out that a number of alleged deficiencies had already been remedied in the ninth part of Act No. 377 / 2005 Coll., on the supplementary supervision of banks, savings and credit cooperatives, electronic money institutions, insurance companies and securities dealers in financial conglomerates and on the amendment of certain other laws (Act on financial conglomerates). Here he pointed out the role of the Securities Commission (now the Czech National Bank), which should guarantee on behalf of the State a fair compensation for their shares to minority shareholders. Similarly, the remuneration is now provided by the transfer of funds to pay the trader of securities or to the bank. In order not to respect the principle of proportionality, he stated that a securities dealer or a bank is required to pay the beneficiaries without undue delay after the registration of the property right in the relevant securities register. At the same time, he pointed out a number of uncertainties of this adjustment - the trade register is not a guarantee of the legality of the procedure for displacing, the unclear range of parties to the review proceedings, the unclarified type of procedure (dispute - undisputed), the type of petition, the unfair allocation of costs of the review proceedings. These questions were not addressed in detail by the Senate of the Parliament of the Czech Republic when discussing the amendments to the Commercial Code, because it assumed that an amendment would interfere with the ownership rights of minority shareholders, thereby violating the rights guaranteed by the Charter. He also stressed that while the 13th Directive allows the right to buy-out, it requires the right to sell-out in Article 16, which is a mirror institute against the right to buy-out. He also commented on the contested provision of § 200da (3) o. s.
26. In the opinion of the Securities Commission, reference was made to the foreign arrangements and to the 13th Directive, which allows for a decision to be taken on the displacements only if such a decision is preceded by a takeover offer and requires Member States to ensure a fair price for the owners of the remaining securities. The legal nature of the resolution of the general meeting is questionable, the Securities Commission is inclined to take the view that it is not an expropriation, but it is an appreciable interference in the rights of minority shareholders, which may not yet be unconstitutional, in so far as it does so by referring to public values, the legislature's desire to construct such legislation and the principle of proportionality has been respected (referring to the finding No 181 / 2005 Coll. - sp. v. The Commission agreed with the appellant on his argument for a reasonable fair compensation (full compensation). This must also be reflected in the expert's procedure, which is first to carry out a strategic analysis of the company, analysis of sales, strengths and weaknesses (SWOT analysis) and financial analysis. Only then can the expert choose the most appropriate valuation method, which is usually the discounted cash flow method and determine the current value of the company. The Commission considers that, in view of the uniqueness of each valued company, rules for making expert opinions cannot take the form of binding legislation. In this context, Section 183i (5) of the Act considers the Securities Commission to be consistent with the requirement for full compensation. Similarly, it did not identify with the appellant regarding the expert's dependence on the main shareholder. In doing so, it referred to the methodology developed by it to establish a reasonable price for takeover bids. This methodology is also applicable for the purposes of displacement. The Commission sees the problem within a short period of time in accordance with § 183i (5) of the Act, when it can only examine the suitability and justification of the expert methods used, the accuracy of the calculations and possible distortion and manipulation. In the Czech Republic, in view of the low liquidity market, price on a regulated market may deviate substantially from the appropriate value; for unlisted companies, the market price criterion cannot be applied at all. The problem is also the issue of interest and the absence of determining the moment at which the price of consideration is to be set. As regards the procedural arrangements for the right of redemption, the conditions under which, in the opinion of the Securities Commission, the constitutional conformity of the crowding-out can be assessed, the possibility of recourse to the court, a clear definition of the rules of procedure, the resolution of the information deficit on the part of minority shareholders, the safeguarding of the position of minority shareholders who did not turn to the court and the adjustment of the costs so as not to hinder the application.
New facts and additional observations of the parties
27. After the issue of the right of redemption was set out in proceedings conducted under sp. zn. Pl. ÚS 56 / 05, the original submission was supplemented in a number of points and further extended. The Judge-Rapporteur therefore requested that the original observations be supplemented so that the parties could take a position on the appellant's complete argument. At the same time, the opinion of the Czech National Bank was requested, which in the meantime took over the tasks carried out by the Securities Commission under the Financial Conglomerates Act.
28. The President of the Chamber of Deputies of the Czech Parliament Ing. Miloslav Vlček stated in particular that the participant had already spoken about the legislative procedure (see sub 24). The provision governing the right to purchase participating securities was included in Act No. 513 / 1991 Coll. by amendment implemented by Act No. 216 / 2005 Coll., on the basis of a parliamentary proposal at second reading. Another amendment to those provisions was contained in Act No. 377 / 2005 Coll., on Financial Conglomerates. The amendments were applied at second reading and were submitted, as justified, to take account of the provisions of Directive 2004 / 25 / EC of the European Parliament and of the Council of 21 April 2004 on takeover bids. He did not comment on the appellant's contested way of submitting those amendments. As regards the contested infringement of the law on forced redemption, that is to say, the deadline for calling the general meeting, questioning the legality of the transaction carried out by the institutions of the registration of the general meeting in connection with § 220da o.s., the failure to determine the amount of consideration in an objective manner, the lack of clarity of the holder of the obligation to pay the consideration to a minority shareholder, the failure of the provisions on the review procedure, the presumption of the right to invoke the inadequacy of the consideration or unfair allocation of the costs of the review proceedings, he generally noted that the legislation had been approved in the Chamber of Deputies of Parliament of the Czech Republic with the intention to simplify the shareholder structure of the company and to allow more efficient decisions in social matters. At the same time, the proposed changes were intended to respond to a number of practical cases where minority shareholders had deliberately abused, in a bullying manner, the exercise of their rights at the expense of the interests of the company as a whole and its development. All this, despite the fact that ownership of the majority stake entails not only greater responsibility for governance, but also greater economic risk that the main shareholder faces compared to the minority. He stated that many of the leading Czech experts in this area also object to this view. Minority shareholders are a group of members whose influence on the operation of a company with a main shareholder fulfilling the conditions for the exercise of the right to purchase securities is negligible. The appellant of the amendment therefore considered squeeze to be a standard institute of balancing the rights and responsibilities of the majority shareholder compared to minority shareholders in corporate governance and, in addition, argued by the need to respond in due time to the provisions of the European directives already in force in Directive 2004 / 25 / EC of the European Parliament and of the Council of 21 April 2004 on takeover bids. This Council Directive lays down an obligation for Member States to ensure that the tender promoter (squeeze-out) holds (or holds) at least 90% of the capital associated with voting rights and 90% of the voting rights of the target company. In view of the adjustment of the number of votes (according to the voting rights) contained in Section 180 (2) of the Act, the number of votes should correspond to the share of the company's capital. The conditions for the bidders are therefore de facto met cumulatively - although it does not appear so at first sight according to the formal version of Paragraph 183i (1) of the Act. He restated that the legislature, when discussing this regulation, acted in the belief that the law adopted was in line with the constitutional order and the international treaties by which the Czech Republic is bound.
29. The President of the Senate of the Parliament of the Czech Republic MUDr. It stated that, as regards the objection of the so-called adhesive, the reference found by the Constitutional Court, sp. zn. Pl. ÚS 77 / 06 states that "the adhesive 'is characterised as a process" whereby the technique of the amendment of the law is accompanied by an amendment to a completely different law, with a non-related legislative proposal'. In the contested law, it is rather the so-called 'legislative rider', since the Doležal supplement does not implement a new law in the legal draft, but only deviates from the narrow space defined for amendments by the legislative draft. It stressed the fundamental importance of examining this issue for future law making. In addition, he argued that since the public limited company is a capital company where the rights and obligations of the shareholders are incorporated into individual shares, it is natural that the owner holding the majority of the shares has greater rights, unless those rights are legally limited. However, the applicant considers the restrictions contained in the Commercial Code to be insufficient. The "principle of equality of arms' which he argued against, can be considered questionable, since its full respect would be against the spirit of capital companies and would lead to unnecessary equality in companies. As regards the argument that nothing was examined in the proceedings before the Registry Court, he stated that since the amendment of the Commercial Code implemented by Law 216 / 2005 Coll. all entries in the Commercial Register were built on this principle. The annulment of the order of the General Assembly is pronounced by an independent court which applies Article 131 of the Act. The law clearly and unambiguously defines cases where the court does not state its validity. Therefore, he did not identify with the appellant's objections. It also recalled the decision of the Federal Constitutional Court of May 2007, which concluded that the exerting of minority shareholders was not a breach of the right to own assets, provided that the interests of minority and majority shareholders were reasonably balanced, in particular if the displaced shareholders received adequate compensation for their shares and were granted effective legal protection.
30. On behalf of the Czech National Bank, the Governor of Doc. Zdeněk Tůma, CSc. First of all, he stressed that the adjustment of the crowding-out in the Commercial Code could not be considered as implementing. In the opinion of the Czech National Bank, the partial discrepancies of the current Czech legislation with European law do not justify the conclusion of the unconstitutional nature of the whole legislation of the extrusion, unless it is established that it is contrary to the constitutional order for another reason, even if, on the basis of a decision by the European Court of Justice in a preliminary ruling pursuant to Article 234 of the Treaty establishing the European Community (hereinafter referred to as the "SES '), one of the applicable provisions governing the right to buy-out for conflict with European law is abolished. The legislation in force cannot be considered as a preliminary transposition of the 13th Directive, which would in addition be contradictory to Community law, for the following reasons:
(a) the rules on the purchase of participating securities adopted on the basis of the parliamentary proposal were not intended to implement the 13th Directive, and therefore it is not possible to talk about the implementation arrangements for the displacement in the Commercial Code;
(b) the existing rules on crowding-out are within the scope of the SES (Article 10 (2), Article 249) as interpreted by the European Court of Justice (Case C-129 / 96 Interenvironment Wallonia ASBL v Région wallone [1997] ECR I-7411.1);
(c) the law on the forced redemption of participating securities is constructed in the Commercial Code as general, contrary to the 13th Directive, and therefore affects a wider range of cases than those provided for in Article 1 thereof. The Directive only applies to the crowding-out after the offer to take over listed participating securities, and Article 1, according to the Czech National Bank, merely shows that the other national rules on the right to purchase participating securities are not affected by the 13th Directive. He referred here to the recital of the 13th Directive, which at the same time cannot be inferred from the fact that the derogation would only concern States which already allowed the right to purchase participating securities at the time of the adoption of the 13th Directive. The Community dimension is therefore only objected to in relation to the crowding-out following the successful takeover offer of listed companies, which is essential for assessing whether the current Czech legislation is capable of seriously jeopardising the objectives set out in the 13th Directive.
The Governor of the Czech National Bank stated that such a case had not yet occurred in practice. However, the contradiction of the Czech legislation with the 13th Directive should be allowed, subject to the above-mentioned sub (a) to (c).
He argued that the right to purchase participating securities was not linked to the right of redemption at the request of a minority shareholder that the Commercial Code regulates the offer of redemption in Paragraph 183h, although it cannot be mixed up with an institute called "sell-out '. It also referred to the preparation of a new adjustment to the so-called additional takeover offer.
To argue that the principles of pricing in situations where a threshold for the exercise of the right to purchase participating securities is reached after the takeover offer are not in line with the Thirteenth Directive, the Governor of the Czech National Bank stated that the legislation in force is clearly not directly contrary to the Thirteenth Directive. He referred to the provisions of Section 183i (5) of the Act and stressed that the Czech National Bank always assesses whether the remuneration is appropriate to the value of the participating securities and, in doubt, takes into account the interest of the owners of the participating securities. The Commercial Code thus allows for interpretation by which the objectives pursued by the 13th Directive are not thwarted or threatened. In addition, the Czech National Bank already has an obligation to take into account the price in the takeover offer that preceded the crowding-out, resulting from the Euroconformal interpretation of national law. In addition, he referred to the forthcoming amendment to Article 183n (1) of the Act of Accession, where this question is to be addressed explicitly on the basis of the second subparagraph of Article 15 (5) of the 13th Directive.
31. Furthermore, the Constitutional Court received the unsolicited observations of the Small Shareholders' Protection Association - Osma (Amicus Curie Brief), which essentially contains the same reasoning as the appellant's assertion and illustrates it with practical examples. On request, this submission was based on the file.
Formal preconditions for discussion of the proposal and the constitutionality of the legislative procedure
32. On this basis, it was possible to assess whether the conditions of the proceedings before the Constitutional Court were met. The application was submitted by a group of 17 senators, which is the minimum number required for such a proposal. In accordance with the case-law of the Constitutional Court (already found in sp. zn. The expiry of the term of office of the Senator (in the present case, the condition had to be met for all members of the proposing group) or any other manner of termination of office (here under Article 25 of the Constitution) no longer affects the assessment of the circumstances of whether it is a legitimate appellant under Paragraph 64 (1) (b) of the Constitutional Court Act.
33. In the light of the wording of the proposal, the Constitutional Court first examined the question of what is the subject of the procedure according to the proposal. The appellant submitted an application for annulment of "part of the law, namely § 183i to 183n of Act No. 513 / 1991 Coll., Commercial Code." Such a provision does not include the Commercial Code from the point of view of legislative technology at all. However, it could be concluded from the individual submissions that the proposal refers to the above-mentioned provisions of the Commercial Code, i.e. Act No. 513 / 1991 Coll., as amended by Act No. 216 / 2005 Coll., Act No. 377 / 2005 Coll., and finally (taking into account in the order of the last summarising submission, albeit not explicitly) also as amended by Act No. 57 / 2006 Coll. The text of the draft contested provisions of the Commercial Code is as follows:
"Right of redemption of participating securities
(1) The person who owns the participating securities in the company,
(a) whose aggregate nominal value is at least 90% of its capital; or
(b) which replace participating securities whose aggregate nominal value is at least 90% of the company's capital; or
(c) with which at least 90% of the voting rights in the company (hereinafter referred to as "the main shareholder") are associated,
is entitled to require the Board to convene a general meeting to decide on the transfer of all other participating securities of the company to its person.
(2) The approval of at least nine-tenths of the votes of all holders of participating securities shall be required for the adoption of the resolution of the General Assembly, with the owners of priority shares and the main shareholder entitled to vote. The decision of the General Assembly shall be taken on a notarial record, annexed to which is an expert opinion on the amount of consideration in money.
(3) The resolution of the General Assembly shall also include the identification of the main shareholder, the data certifying that the shareholder is the main shareholder, and the amount of the remuneration determined in accordance with Paragraph 183j (6) and the deadline for the granting of the remuneration.
(4) For the purposes of determining the proportion referred to in paragraph 1, the participating securities held by the company shall be distributed among the holders of the participating securities in proportion to the nominal values of their participating securities.
(5) For the adoption of the resolution of the general meeting on the transfer of all other participating securities of the company to the person of the main shareholder, prior approval of the Czech National Bank is required, which may not be more than 3 months old, otherwise the resolution of the general meeting is invalid. Paragraph 183e shall apply mutatis mutandis; the period referred to in Paragraph 183e (8) is extended to 15 working days. The main shareholder is the party to the proceedings. The Czech National Bank always assesses whether the amount of the consideration is proportionate to the value of the participating securities, taking into account, in particular, the fact that the holder of the participating securities is deprived of the choice of whether and when to transfer the participating securities to the main shareholder when assessing the adequacy of the remuneration; in doubt, the Czech National Bank will take into account the interest of the holders of participating securities.
(6) The main shareholder shall, before holding the general meeting, hand over the funds to the dealer of securities or to the bank at the amount needed to pay the consideration and to the general meeting, demonstrate that fact. The remuneration shall be paid by the bank or the securities dealer.
(1) The Board of Directors shall convene the General Meeting within 15 days of the date of receipt of the application pursuant to Paragraph 183i (1) of the company.
(2) An invitation to the general meeting or notice of its conduct shall also include relevant information on the determination of the amount of the consideration, or, where required, the conclusions of the expert opinion, which is requested, to the lien creditors who are known to the company or should be known for the care of the proper operator, in order for the companies to disclose the existence of a lien in respect of the participating securities issued by the company, and the Board's observations on whether it considers the amount of the consideration determined in accordance with paragraph 6 to be fair.
(3) The designation of the main shareholder, the justification for the amount of the consideration, the expert opinion referred to in paragraph 6, the decision of the Czech National Bank pursuant to Paragraph 183i (5), will make the company available at its registered office for consultation of each participant's security owner. Article 184 (8), second and third sentences shall apply mutatis mutandis. The company with listed shares shall simultaneously publish information on the procedure under Paragraph 183i (1) and conclusions of the expert opinion, if required, in a way that allows remote access.
(4) The draft order of the General Meeting shall not deviate from the justification for the amount of consideration or from the expert opinion referred to in paragraph 6 in determining the amount of consideration.
(5) The owners of the company's pledged participating securities without undue delay after having been informed of the general meeting, shall communicate to the company the fact of the termination and the person of the lien creditor; an indication of this obligation shall be given in the invitation to the general meeting or in the notice of its performance.
(6) Together with the application under Section 183i (1), the main shareholder of the company shall deliver a justification for determining the amount of the consideration, expert opinion and decision of the Czech National Bank pursuant to Section 183i (5); the main shareholder shall bear the costs of acquiring and delivering these instruments.
(1) The holders of participating securities may, from the time of receipt of the invitation to the general meeting or, where appropriate, from the date of notification of its conduct, request the court to examine the adequacy of the remuneration; If this right is not exercised within a month of the date of publication of the minutes of the General Meeting's order under Paragraph 183l, it shall cease to exist.
(2) In the event that the holder of the participating security does not exercise the right under paragraph 1, he may no longer rely on the disproportionate remuneration.
(3) The decision granting the right to a different amount of remuneration is binding on the principal shareholder and the company both in terms of the basis of the right granted and in respect of the other holders of the participating securities. The period of limitation shall begin to run from the date of the decision, in respect of all the persons entitled, irrespective of whether they were parties to the proceedings.
(4) The determination of the inadequacy of the amount of the remuneration does not render the General Assembly's orders null and void under Paragraph 183i (1).
(5) The application for annulment of the general meeting's resolution pursuant to Paragraph 131 cannot be based on the inadequacy of the amount of consideration.
(1) The Board of Directors shall, without undue delay after the adoption of the resolution by the General Assembly, submit a proposal for the entry of the resolution in the Commercial Register.
(2) At the same time, the resolution of the General Assembly and the conclusions of the expert opinion shall, where required, be published in a manner designed to bring together the General Meeting of the Society and shall deposit a notarial registration at the registered office for inspection; a notice of this fact shall also appear in the published notice.
(3) By the expiry of a month from the publication of the entry in the Commercial Register of a resolution referred to in paragraph 1, ownership of the participating securities of minority shareholders of the company shall be transferred to the main shareholder.
(4 Paragraphs 5 and 6 shall apply mutatis mutandis to a lien that holds a pledged participant security.
(5) The current owners of paper participating securities shall submit them to the company within 30 days of the transfer of ownership; they may not, at the time of delay, claim compensation under Paragraph 183m. The company shall give an order to register the change of the owners of the book-entry participating securities in the property accounts of the person entitled to keep the relevant stock records under the special legislation within the same time limit, stating that the resolution of the general meeting referred to in Article 183i (1) is the basis for the entry of the change.
(6) If the current holders of participating securities do not submit such securities within a month or, where appropriate, within an additional period specified by the company, which may not be less than 14 days, the company shall proceed in accordance with § 214 (1) to (3).
(7) The company will forward the returned participating securities to the main shareholder without undue delay. The board of directors of the company shall issue to the main shareholder, without undue delay, new participating securities of the same form, form, type and nominal value as the participating securities declared invalid.
(1) Authorised persons are entitled to consideration in cash, the amount of which shall be determined by the principal shareholder; the main shareholder shall demonstrate the adequacy of the remuneration by means of an expert opinion which may not be more than 3 months old on the date of receipt of the application pursuant to Paragraph 183i (1) and the amount of which will be reviewed by the Czech National Bank.
(2) The right to pay the consideration by entering the property right in the relevant stock records and the holders of the paper-based securities shall arise from the right to pay the consideration by transferring them to the company pursuant to Article 183l (5) and (6).
(3) The securities dealer or the bank shall provide the eligible persons with the consideration without undue delay upon fulfilment of the conditions laid down in paragraph 2.
(4) The securities dealer or the bank shall always pay the consideration to the owner of the purchased participating securities, unless it is demonstrated that the redemption of the participating securities is stopped, then provide an amount corresponding to the value of the pledged participating securities to the lien creditor; This does not apply if the owner proves that the lien has already expired or if the agreement between him and the lien creditor determines otherwise.
(1) The publication of the general meeting's resolutions eliminates participating securities from trading on the official market if listed. Paragraph 186a (1) and (2) shall not apply. The company shall inform the operator of the regulated market in which the participating securities referred to in paragraph 1 have been admitted to trading on the application for inclusion in the relevant list, in accordance with the specific legislation.
(2) The regulated market operator shall immediately notify the competent depositary and the Czech National Bank of the withdrawal of participating securities from trading on a regulated market.
(3) The law of the main shareholder under Paragraph 183i (1), which is not exercised within 3 months of the date of acquisition of the relevant shareholding, expires. "
34. The Constitutional Court, within the meaning of § 68 (2) of the Law on the Constitutional Court, first dealt with the way in which the contested provisions were adopted and issued, paragraphs 183i to 183n of the Act. These provisions were inserted in the Commercial Code by Act No. 216 / 2005 Coll., amending Act No. 513 / 1991 Coll., Commercial Code, as amended, Act No. 99 / 1963 Coll., Civil Code, as amended, Act No. 189 / 1994 Coll., on Senior Judicial Officers, as amended, and Act No. 358 / 1992 Coll., on notaries and their activities (notarial Order), as amended. This Act was published on 3 June 2005 in the amount of No 77 / 2005 Collections of Czech Laws. They were subsequently partially amended by Act No. 377 / 2005 Coll., on the supplementary supervision of banks, savings and credit cooperatives, electronic money institutions, insurance companies and securities dealers in financial conglomerates and on the amendment of certain other laws (Act on financial conglomerates). This Act was published on 29 September 2005 in the amount of No 132 / 2005 Collections of Czech Laws. The second change took place in the context of the new regulation of financial market supervision in the form of Act No. 57 / 2006 Coll., on the amendment of laws in the context of the unification of financial market supervision. As a result of this change in the provisions of Sections 183i (5) and 183n (2) of the Act, the tasks of the Securities Commission have been transferred to the Czech National Bank.
35. The data of the Digital Library of the Chamber of Deputies of the Parliament of the Czech Republic result from these basic data. The draft Act No. 216 / 2005 Coll. was originally submitted as a parliamentary proposal by Mr Pospíšil (Press No. 566). Chamber of Deputies. IV vol., 2005). In the Chamber of Deputies of the Parliament of the Czech Republic, the first reading of the draft law mentioned in press No 566 took place on 2 April 2004. Within its framework, the bill was ordered to discuss the constitutional and economic committee. The Constitutional Committee discussed the draft law on 20 October 2004 and adopted resolution 143 (mentioned in press No 566 / 2), containing a comprehensive amendment. The Economic Committee discussed and approved the draft law on 11 November 2004 by Resolution No 269 (mentioned in Press No 566 / 3), as amended by a comprehensive amendment identical to the constitutional committee. As part of the second reading on 24 November 2004, at the 38th meeting of the Chamber of Deputies of the Parliament of the Czech Republic, the proposal was, inter alia, extended with the proposal of Mr Doležal. Mr Doležal has already made it available to both committees, but they have not adopted it and have not worked into the comprehensive amendment. The proposal was adopted at third reading and included in the overall proposal (vote 32 in 120 pro, 53 against with the participation of 186 members of the Chamber of Deputies of the Parliament of the Czech Republic). The overall proposal was approved on 9 February 2005 at the 41st meeting of the Chamber of Deputies of the Parliament of the Czech Republic in vote No 39 by 182 votes of 185.
36. The Senate of the Parliament of the Czech Republic discussed the draft law at its 4th meeting on 31 March 2005 and adopted resolution 104 on the draft law by which it returned the draft law to the Chamber of Deputies of the Parliament of the Czech Republic with amendments. Of the 69 senators and senators present, 64 were in favour, no one was against it. The Chamber of Deputies of the Parliament of the Czech Republic renegotiated the draft law at its 44th meeting on 5 May 2005, and Resolution No. 1626 maintained the original version of the draft law by 135 votes from 193, against which two members of the Chamber of Deputies of the Parliament of the Czech Republic were opposed. It should be recalled that one of the amendments made by the Senate of the Parliament of the Czech Republic was aimed precisely at deleting the provisions introduced by Sections 183i to 183n of the Act. (Mr Doležal's proposal). However, this proposal received only 91 votes out of 189. The President of the Republic signed the Act and the Act was declared on 3 June 2005 in the amount of No 77 / 2005 of the Collection of Laws of the Czech Republic. Its effectiveness was divided, part of the provisions became effective on the date of its publication, part of it on 1 July 2005.
37. The Commercial Code was amended shortly after that by Act No. 377 / 2005 Coll., on the supplementary supervision of banks, savings and credit cooperatives, electronic money institutions, insurance companies and securities dealers in financial conglomerates and on the amendment of certain other laws (Financial Conglomerates Act). In this case it was a government bill (Press 835. Chamber of Deputies. IV vol., 2005). In addition to its own subject matter (financial conglomerates), the government's proposal included the amendment of sectoral laws on the supervision of the activities of banks, insurance companies and securities dealers, i.e. the Bank Act, the Czech National Bank Act, the Insurance Act, the Capital Market Enterprise Act and the Act on savings and credit cooperatives, but not the amendment of the relevant part of the Commercial Code. At the first reading, which took place on 14 December 2004 at the 39th meeting of the House of Parliament of the Czech Republic, the draft law was ordered to the Committee on Budgets. The Committee on Budgets discussed the draft law on 11 March 2005 and, by Resolution No 496 of 2 March 2005, suspended the hearing on this point until 9 March 2005. At the 41st meeting of the Committee on Budgets, held on 9 March 2005, by Resolution No 520, the Committee recommended to the Chamber of Deputies of the Parliament of the Czech Republic to give its assent to the Government's proposal for supplementary supervision of banks, savings banks and credit cooperatives, electronic money institutions, insurance companies and securities dealers in financial conglomerates and to the amendment of related laws (Financial Conglomerates Act) as amended by the amendments adopted (see Document PS No 835 / 2). At the 42nd session of the Chamber of Deputies of the Parliament of the Czech Republic during the hearing, the bill was returned to the Budget Committee for reconsideration in the second reading (23 March 2005) following a general debate. The Committee on Budgets discussed the draft law at its 45th meeting of 8 June 2005 and agreed with the draft law by resolution No 597 with the comments made in this resolution (see document PS No 835 / 3). The bill was re-passed by a general debate at the 45th session of the Chamber of Deputies of the Parliament of the Czech Republic on 17 June 2005, where other amendments were tabled (see Document PS No. 835 / 4). At the third reading, which took place on 1 July 2005 at the same meeting of the Chamber of Deputies of the Parliament of the Czech Republic, the bill was passed in vote 690 by 152 of the 158 Members present, no one was against it. This law was also extended by a number of amendments which did not concern the main subject matter of the proposal, i.e. supplementary supervision. The original six parts of the proposal were amended, but a further 28 parts were added to the proposal, among them part nine, which amends certain provisions of the Commercial Code on the Law of Purchase. The Senate of the Parliament of the Czech Republic returned to the Chamber of Deputies of the Parliament of the Czech Republic a bill with amendments concerning changes to the law on redemption. The bill returned by the Senate of the Parliament of the Czech Republic was voted on 19 August 2005 at the 46th meeting of the Chamber of Deputies of the Parliament of the Czech Republic. The House of Parliament of the Czech Republic remained in the presence of 180 Members on the original bill (resolution 1835) by vote 147 Members, against which was one vote.
38. The last amendment to the provisions in question was carried out by Act No 57 / 2006 Coll., on the amendment of the laws in connection with the unification of financial market supervision, in its Part Twenty-third, Article XLII. In this case, it was the replacement of the Securities Commission by the Czech National Bank, to which its tasks were also transferred in the field of redemption law (Sections 183i (5) and 183n (2) of the Act.). Other changes to the law of forced redemption were not brought. This proposal (Press No 997. Chamber of Deputies. IV vol. 2005) originally did not contain this change. It was included in the Comprehensive Amendment to the Budget Committee (Press No 997 / 5). Since the proposal was not made orally, it is not possible to determine from the stenographic record who it was submitted to. However, there is no doubt that this was a proposal that was relevant to the present case, since it was only during the course of the procedure that the Budget Committee was proposed to abolish the Securities Commission and take over its tasks by the Czech National Bank. The Chamber of Deputies of the Parliament of the Czech Republic approved the bill at the 51st session of 7 December 2005 in vote 696, when in the presence of 181 Members voted 163, against was one vote. The Senate of Parliament of the Czech Republic approved the bill on 2 February 2006 at the 9th session of the 5th term of office of 43 senators against 17 votes in the presence of 69 senators.
39. In particular, it follows from the above description of the procedure for approving the contested legislation that Law No 216 / 2005 Coll. is not the result of a legislative initiative under Article 41 (1) of the Constitution. The original proposal was submitted on 20 January 2004 in the form of a proper parliamentary initiative by Mr Pospíšil as Press Number 566. This proposal went through the first reading. At the second reading of 24 November 2004, Mr V. Doležal spoke in the general debate: "I would not like to disturb the idyla that was heard in the negotiations of this law, but I would like to call for an amendment concerning the so-called squeeze-out. To give the truth enough, I would like to warn you that it has been consulted both by the petitioner who is reconciled with it and by the Minister who agrees with it. It has even been submitted to both the Constitutional and Economic Committee in good time to study it. If they didn't find the strength, the courage and the desire to deal with it, I don't know, he didn't appear in their resolution. That's why I'm presenting it. You all received it yesterday in written form on the table, I will not read this entire proposal. I would just like to point out that this is an amendment to the Commercial Code, which results from the 13th Directive of the European Union, and it is one of the things that is waiting for us sooner or later, so it is convenient to work it now. Since it was presented to everyone on the bench yesterday with the justification for all changes, I would not want to interfere with the idyll here. I will therefore just sign up for a detailed debate where I would modify this amendment so that it can be incorporated into a comprehensive amendment to the Constitutional Law Committee." This proposal was approved as part of the amendments (press 566 / 4 (C)). He got back on the agenda of the Chamber of Deputies of the Parliament of the Czech Republic in the re-discussion of the bill, which was returned to the Chamber of Deputies of the Parliament of the Czech Republic by the Senate of the Parliament of the Czech Republic. Since the Senate of the Parliament of the Czech Republic proposed the expulsion of the law of forced redemption, there was a risk that the law as a whole would not be adopted. This is illustrated by the speech of the original initiator, Mr Pospíšil, who, in this context at the 44th meeting of 3 May 2005, in an attempt to preserve the meaning of the original proposal, said: "Ladies and gentlemen, in conclusion, I would like to repeat the words of Mr Vrbik and appeal to you. The material we are discussing has been discussed for almost a year in the Chamber of Deputies. The expert teams, the ODS legal teams and the former Minister Bures' legal teams worked on it. Few materials are discussed in such detail in the legislative process. Few materials have obtained such a match on the premises of the Chamber of Deputies across the political spectrum. Few material will help the Czech business public so much. Therefore, ladies and gentlemen, please, when discussing this material - we will vote on the Senate and subsequently the parliamentary version - whether your opinion on squeeze is one or another, please keep in mind that the law itself regulates the proceedings in front of trade registers and that this proposal is very important for the Czech business public." The meeting itself in the Chamber of Deputies of the Parliament of the Czech Republic, as well as in the Senate of the Parliament of the Czech Republic (see the speech of the petitioner Pospíšil and the senators Kubín, Paukret, Stodůlky, Sefziga at the 4th meeting of the Senate of the Parliament of the Czech Republic on 31 March 2005) shows that the amendment of Mr Doležal was seen as something not at all related to the original proposal for the amendment of the Commercial Code and the Civil Code (Civil Procedure). A similar situation occurred when the first amendment to the law of forced redemption was adopted by Act No. 377 / 2005 Coll., where the amendment to this regulation was inserted in the form of an amendment by Mr Doležal.
40. The Constitutional Court takes the view that the assessment of the way in which the contested provisions of the Law were proposed, discussed and approved is part of the assessment of whether such a law was adopted in a constitutional manner (Section 68 (2) of the Constitutional Court Act). Mr Doležal's proposal does not change or complete the proposal made by Mr Pospíšil. It concerned another issue, but it also envisages the existence of a business register and entries into it. The Constitutional Court therefore had to first deal with the question whether, when adopting Act No. 216 / 2005 Coll. there is no such serious breach of the rules of the legislative procedure as should lead to the repeal of this law for precisely this reason (see the finding of the Fifth ÚS 77 / 06, published under No 37 / 2007 Coll.).
41. In the view of the Constitutional Court (on top of this finding No. 37 / 2007 Coll.), the departure from the restricted space reserved for amendments may assume the nature of exceeding the intensity of the proposal or exceeding the extension of the subject-matter defined by the draft law. This requirement of a close relationship or the immediate context of the content and purpose of the proposal and the amendment thereto is part of the foundations of parliamentary technology and reglement law. It brings to mind the laws and parliamentary procedures at all necessary order. However, each State and, within it, every House of the legislature often seeks its own means of ensuring that this requirement is respected, or it lays down special rules for staying out of their limits (e.g. increased qualified majority, support for a number of other Members, expression or consent of the appellant, renegotiation of the proposal). Similarly, the intensity of judicial review of compliance with these rules varies between Member States. There is therefore no universal opinion on this issue. The Constitutional Court defined its approach precisely in the above-mentioned finding, where it pointed out that the so-called "appendage 'is the case when the technique of the amendment adds an amendment to the draft law to an entirely different law, with a legislative proposal not related. In the view of the Constitutional Court, the constitutional interpretation of the provisions governing the right to table amendments to the draft law requires that" the amendment should in fact only amend the legislation referred to, i.e. in accordance with the requirements of the so-called narrow relationship rule, according to which the amendment must relate to the same subject matter of the proposal which is currently under discussion in the legislative process, the amendment should not deviate from the restricted space reserved for amendments in the form of an extensive overrun of the subject matter of the proposed law'. The right to make amendments is part of the constitutionally consistent creation of the will by the parliament of a democratic state. However, the amendment is, by its nature, a proposal of accessorial nature to a proposal which has been submitted in the form of a legislative initiative under Article 41 of the Constitution. Therefore, Paragraph 63 (1) (5) (a) of the Rules of Procedure of the Chamber of Deputies of the Parliament of the Czech Republic (Act No. 90 / 1995 Coll., on the Rules of Procedure of the Chamber of Deputies, as amended) requires that certain parts of the "original proposal 'be deleted, extended or amended. The basis of the parliamentary discussion is this original proposal, to which the Government speaks pursuant to Article 44 (1) of the Constitution, committees to which the draft law has not been ordered or individual Members pursuant to Article 91 (4) of the Rules of Procedure of the Chamber of Deputies of the Parliament of the Czech Republic. If this is not the case, the Constitutional Court considers that there is a breach of the division of power. This has implications for the principles of the creation of a consistent, transparent and predictable law, which the Constitutional Court has already linked to the attributes of a democratic rule of law. This also involves circumventing the Institute of Legislative Initiative pursuant to Article 41 of the Constitution and violating the right of the Government to comment on the draft law pursuant to Article 44 of the Constitution.
42. In the present case, however, the situation is not entirely the same as that dealt with by the Constitutional Court in its cited finding. Press No. 566 contained a proposal by Mr Jiří Pospížila to issue a law amending Act No. 513 / 1991 Coll., Commercial Code, as amended, and Act No. 99 / 1963 Coll., Civil Code, as amended. From a point of view, the provisions of § 3 of the Act, which was to be repealed, also § 27 to 34o of the Act, where the head of the third part of the Act was to be readapted in respect of the Commercial Register, and finally § 200a to 200df o. s. o., relating to the proceedings in matters relating to the Commercial Register. It could not relate in substance to the law of forced redemption (§ 183i to 183n obch. zázak.), since this issue was only brought into the Commercial Code through the aforementioned proposal by Mr Doležal. However, this is not relevant to the assessment of the admissibility of Mr Doležala's proposal. In this case, on the contrary, this is an assessment of the substantive relationship of the amendment to the original proposal. The starting point of the assessment of this close or meritorial relationship is the "original proposal ', the legislative initiative (amending the law) under Article 41 of the Constitution, not the law which is the subject of the initiative (amended law). It therefore does not decide whether the amendment is the subject of the Commercial Code (broad relationship), but whether it is the amendment of the Commercial Register Regulation and the Register Procedure in the Civil Code (close relationship).
43. The binding of the original proposal by Mr Pospíšil and the amendment by Mr Doležal is therefore merely formal and not meritative. In particular, the seriousness of such a proposal is against the admissibility. The Government did not have the opportunity to comment on this proposal, although it corresponds to the Chamber of Deputies of the Parliament of the Czech Republic on internal and foreign policy matters. The 13th Directive concerns the fulfilment of an obligation arising from membership of the European Union. Although the amendment is not excluded, it interferes with the position of government as a representative of the Czech Republic in relation to the European Union. Although the amendment relates to matters governed by the Commercial Code, it does not include in the original proposal an amendment which would concern a completely different law. However, Mr Pospíšil's original proposal concerns only indirectly, only because they are registered in a commercial register, in a way that does not allow judicial review. Mr Pospíšil himself stated (at the Fourth Senate meeting on 31 March 2005) that "the proposed proposal did not aim to significantly amend the substantive legislation in force contained in the Commercial Code, which concerns trade registers. In layman's terms, our proposal does not, in principle, alter the facts that are entered in the trade registers under the applicable commercial law."
44. in Found No 37 / 2007 Coll. However, the Constitutional Court has pointed out that the possible assessment of similar violations of the principles of the legislative process in the past will link the proportionality test in relation to the principles of protecting citizens' legitimate trust in law, legal certainty and acquired rights, possibly in relation to other constitutional rules protected by principles, fundamental rights, freedoms and public goods. Therefore, the Constitutional Court had to assess the other circumstances of the case, so that its role was not limited to reviewing the hundreds of procedural errors of both the House and its governing bodies without having any impact on the assessment of the material constitutionality of the rule of law. If the Constitutional Court had started to comply with such reasoned proposals for the annulment of the law only for those procedural reasons at the limit of constitutional order and reglement law, a state of considerable legal uncertainty would have been created, in particular, where it would not have been possible to rule out the matter in terms of content. Therefore, the circumstances that should have led the Constitutional Court not only to review compliance with the close relationship between the original proposal and the amendment had to be assessed.
45. In favour of this relationship, it states that the execution of the forced redemption is entered in the Commercial Register (§ 183l (1) obch. zázák.) and that the method of such registration pursuant to § 200da o. s.) is the subject of proceedings before the Constitutional Court under sp. zn. A finding of the unconstitutional nature of this regulation would also have consequences for this procedure. The fact that in the case of the finding No 37 / 2007 Coll. it was an unimplemented law cannot be ignored. In the initiating case Articles II and III of Act No. 443 / 2006 Coll., amending Act No. 319 / 2001 Coll., amending Act No. 21 / 1992 Coll., on Banks, as amended, the Act has not yet been applied. Besides, his application would be basically a one-time thing. In the present case, on the contrary, it is an adjustment to the law on forced redemption which has already been amended twice. Thus, the government had the opportunity to express its position and apply its own legislative initiative. In contrast to the initiating case, this regulation has been applied many times in practice, in which, as in theory, it has raised a number of disputes, the resolution of which is expected by the Constitutional Court of both the company and, in particular, the judicial practice in the commercial law sector. This also applies to the legislator who is to transpose the 13th Directive in the form of the Takeover Offers Act (Chamber of Deputies. Press No 358 of 14 November 2007), as well as judicial authority. In this context, it should be recalled that the Constitutional Court, in the decision of the Constitutional Court, in the decision of page Pl. ÚS 23 / 04 (Collection of finds and orders of the Constitutional Court, Volume 38, Found No 137, published under No. 331 / 2005 Coll.), has applied for restraint in the evaluation of the law adoption procedure itself. In such a case, the formal repeal of the law on forced redemption as a whole (nothing else would be considered in the case at hand) would constitute a danger of the same regulation being re-adopted, only with the exception that all the requirements of the legislative process are respected. The Constitutional Court has concluded that, in the present case, the formal and procedural aspects of the review give rise to the requirements of the principles of the material rule of law, legal certainty and effective protection of constitutionality in the light of the principle of proportionality.
Assessment of the constitutionality of the law on redemption
46. In its summary of 28 February 2007, the appellant notes that the Czech law on the purchase of participating securities shows a large number of defects, the combined effect of which makes it contrary to the right to the peaceful use of property and to the right to a fair trial, as well as European Community and international law. However, as is apparent from the abovementioned summarisation of the complaints, in most cases it does not specify them in the sense of the requirements arising from Article 87 (1) (a) of the Constitution. In contrast to the previous submissions, he included the alleged contradictions with Community law, without further characterising the need to intervene at the same time by the Constitutional Court within the meaning of Article 87 (1) (a) of the Constitution. Therefore, it was also necessary to draw on earlier submissions from the appellant, where some constitutional arguments were still more significantly incorporated (sub 13 to 22).
47. The fundamental issue is the assessment of the constitutionality of the compulsory redemption institute itself, both in terms of the constitutional order of the Czech Republic [Article 87 (1) (a) of the Constitution] and in terms of the international obligations of the Czech Republic pursuant to Article 1 (2) of the Constitution. In this context, the objection of infringement of Article 11 (4) of the Charter had to be dealt with and, in particular, the question of possible interference with property law under Article 11 (1) and (3) of the Charter, despite the fact that the appellant did not support its proposal for those provisions. In this respect, it was necessary to assess whether:
(a) constitutional order, irrespective of the 13th Directive, allows such interference in ownership law and whether the criterion for defining the principal and minority shareholders complies with the principle of proportionality;
(b) whether the intervention is legitimate and rational when the law does not state the reasons for the exercise of the law on forced redemption and whether it corresponds to the nature and specificities of relations in a public limited company;
(c) by establishing the law of forced redemption, the State has fulfilled its protection function and has not allowed undue interference with property law;
(d) this intervention complies with the conditions laid down in Articles 4 (2) and 11 of the Charter and Article 1 of the Additional Protocol to the European Convention;
(e) there has been no interference with acquired rights and a breach of the principle of legitimate expectations.
48. Before the Constitutional Court took a position on the above issues, it was necessary to deal with the last version of the appellant's submissions, which is based primarily on the alleged contradiction of the law on forced redemption with the 13th Directive (sub 6 and 7). There is nothing left but to state what the Constitutional Court has already mentioned several times (in particular the finding of the Pl. ÚS 50 / 04, the Collection of Finals and the Order of the Constitutional Court, Volume 40, Found No. 50, Declared under No. 154 / 2006 Coll., and Pl. ÚS 36 / 05, Declared under No. 57 / 2007 Coll.). The reference aspect of the review of the constitutionality of laws under Articles 87 (1) (a) and 88 (2) of the Constitution is constitutional order. The Constitutional Court is not competent in such proceedings to examine the conformity of national law with Community law. Application of Community law as an immediately applicable law (see Case 106 / 77 Amministrazione delle Finanze dello Stato v Simmenthal SpA. Reference for a preliminary ruling: Pretura di Susa - Italy. The non-application of a law which is contrary to Community law by a national court known as Simmenthal II, available in the ECR, 1978, p. 629, e.g. at http: / / eur-lex.europa.eu), is the responsibility of the general courts, which, in case of doubt about the application of this right, have the possibility or the obligation to refer to the European Court of Justice with a preliminary question under Article 234 of the EC Treaty. In view of the reference criteria for decisions of the Constitutional Court, nothing changes. Article 1 (2) of the Constitution, as well as for the Constitutional Court as a state body of the Czech Republic, implies the obligation of European conformal interpretation (see also the find sp. zn. Pl. ÚS 66 / 04, Collection of finds and orders of the Constitutional Court, Volume 41, Found No. 93, Declared under No. 434 / 2006 Coll., in relation to Union law) of constitutional order in areas where Community law and the rule of law of the Czech Republic meet (Loyalty obligation under Article 10 EC). But it must be an interpretation of constitutional order in relation to national law. However, the appellant requests the Constitutional Court to rule on its objections to the defective transposition of Community law. That's why the Constitutional Court left those aside. If the appellant were limited to them alone, it would be necessary to reject the application in the absence of jurisdiction of the Constitutional Court. The Constitutional Court must, however, take account of membership of the European Union in the light of Article 1 (2) of the Constitution and consider the possible use of the option given to it by Article 70 (1) of the Law on the Constitutional Court.
49. The same applies to the objection of non-respect of non-specified international investment protection treaties. It is also a question of their application in the case-law of the General Courts, which are bound by such contracts, provided that they comply with the requirements of Article 10 of the Constitution. Where such a convention contains different rules, the principle of application of such a convention must be applied. As this is not a problem of the relationship hierarchy (by legal force) but of the application hierarchy, reference should be made to the rules enshrined in Articles 10 and 95 (1) of the Constitution.
50. Similarly, the Constitutional Court left aside the appellants' objections, which merely refer to the requirement to interpret ordinary law. The misunderstandings in the law must be removed by the case law of the general courts and the removal of any discrepancies in the decisions of the general courts is within the jurisdiction of the Supreme Court. The Constitutional Court has already stated more than once that it can only enter this area if it is a violation of constitutional law and inaccuracy, insecurity and unpredictability of legislation are extremely distorting the fundamental requirements of law under the rule of law.
51. The fundamental issue is therefore the constitutional admissibility of the compulsory purchase of shares in the rule of law (Article 1 (1) of the Constitution) in terms of the requirements of legality, rational justification (prohibition of arbitrariness), necessity, legal certainty, predictability and certainty of law. It is only after its reply that it can be assessed whether its adjustment in individuals meets the constitutional criteria. On this basis, it was possible to decide whether such adjustment as a whole or only individual parts of it would be repealed. Already in the find sp. zn. Pl. ÚS 59 / 2000 (Collection of finds and orders of the Constitutional Court, Volume 22, Found No. 90, published under No. 278 / 2001 Coll.) The Constitutional Court stressed the importance of economic factors for the interpretation of constitutional rules governing the functioning of the market economy. Therefore, the interpretation of the provisions on forced redemption should be treated in the light of the specificities of the area to which they are to be applied and from which the problems to which the solution is to be legally regulated arise. A stock company has a different character than a trade union, a society, a political party or a religious society. Similarly, the fulfilment of constitutional requirements for the creation, functioning and demise of such a company cannot be assessed by the same standards. Membership based on ownership of shares cannot be compared to the payment of membership contributions or the crowding out of so-called minority shareholders, excluding a member from the association or political party. Therefore, the understanding of shareholders as owners as compared to owners of other assets is particularly discussed in the case of minority owners (so-called passive owners - closer to Lee, J.: Four Models of Minority Sharoholder Protection in Takeovers. European Business Law Review, 2005, No 4, p. 809). The aim of the public limited company is to concentrate capital, investment, business and profit. In the event that one of the shareholders achieves a specified share of shares in accordance with Paragraph 183i (1) and (4) of the Act, there is a situation in the public limited company where the remaining shareholders may (but may not) cease to be of benefit to such a company. This applies both in terms of the importance of their participation in the company's total capital and their ability to influence its decision-making. On the contrary, their participation may be burdened by the public limited liability company in terms of its operating costs, the assembly of general meetings and their decision-making with regard to the rights of those shareholders. A significant number of small shareholders may (but may not) represent unnecessary increased administrative and management costs for the company. The share company has a duty to such shareholders to an unchanged extent, although their potential contribution to its continued development, to the adoption of strategic and other decisions, is virtually zero. Most of these arguments are part of the background report of the Expert Group on Adoption of the 13th Directive known as the "Winter Report '(according to Jaapa Wintera's presiding group - Text Report of the High Level Group of Company Law Experts on Issues Related to Takeover Bids. Available at: http: / / ec.europa.eu / internal _ market / company / docs / takeoverbids / 2002-01-hlg-report _ en.pdf, p. 60-61). At present, the view prevails that public limited liability companies require a flexible legal framework to achieve their strategic objectives, which cannot always be achieved through the conclusion of contracts. Therefore, the legislator should create the necessary conditions (so van der Elst, Ch., van den Steen, L.: Squeezing and Sellingout - a Patchwork of Rules in Five European Member States. European Company Law, 2007, No 1, p. 25). Another important factor in the conditions of the Czech Republic is the coupon privatisation, which created a substantially different type of shareholder structure of public limited liability companies than in the states whose experience and legislation is invoked by the appellant. Therefore, comparison with countries where no such mass action has taken place is no longer appropriate. The Constitutional Court merely recalls this aspect, without expressing itself on this form of privatisation in terms of its advantages (on this point the find sp. zn. The same applies to considerations regarding the need for the introduction of a forced redemption institute for reasons of competitiveness and the increased interest of foreign investors in domestic business.
52. The position of shareholders cannot be compared with Member States' rights in other types of associations and companies. The shareholder's share is determined by the size of its investment and, at the same time, by the risks it bears for this reason. Shareholders' rights (see Heir, J. et al.: Stock companies. 6. If the shareholder holds 90% of the shares, the influence of the remaining shareholders on the company's operations is flimsy and the possibility of participating in major decisions on the company's direction is illusory. The right to clarification and information obligations may complicate the strategic decisions of the main shareholder. Such decisions may also be challenged as a form of abuse of a majority of votes in society against the detriment of a minority (§ 56a of the CoR.). The possibility of such disputes may already make business intentions of the main shareholder difficult. It cannot be seen that the prohibition of abuse of status can objectively restrict the main shareholder in view of the presence of the remaining shareholders. On the contrary, a reference to the possible abuse of their rights is not decisive in this regard. Whereas, in the case of the main shareholder, the 90% share situation applies to the full extent both the components of the participation, the business and the capital, the minority shareholders or the minority shareholder are already only involved in capital as an investor, while the decision-making component is practically suppressed. If they are granted adequate compensation for such an investment, they cannot be objected to in the light of constitutionality under such conditions of forced redemption. It cannot also be excluded that such a measure may also benefit minority shareholders, since under certain conditions such shares lose value and the shares become non-marketable as they cease to be interested. Therefore, the creation of a legal arrangement for the forced purchase of shares can also, in some circumstances, be seen as a possible advantage for minority shareholders in view of the increased interest in taking over a public limited company. The potential interested party is generally interested in acquiring the company as a whole, which may have a favourable effect on the price of the shares (e.g. Münchener Kommentar zum Aktiengesetz. 2nd edition, Bd. 9 / 1, § 327a - § 327f, Vorbemerkung, AktGWpÜG. SpruchG. München 2004, Note 3). Therefore, the interpretation of the legislation cannot clearly be concluded as part of the abstract control on the inconstitutionality of the regulation. On the basis of the use of the possibility of forced redemption, intervention in the constitutionally guaranteed rights of members is not excluded, but such an option does not in itself cause unconstitutionality. This could only be the case if the State did not provide legal protection to minority shareholders under its protection function. The fact that, by virtue of the legislation of a particular institute (e.g. binding, expulsion, expropriation, exclusion from society), a breach of constitutional rights is not yet causing inconstitutionality. This would only happen if their constitutional "guarantee" proved fictitious.
53. As regards the general objection that this is a form of expropriation, it should be noted that the body which deprives minority shareholders of their rights is not a public authority promoting the public interest. The forced purchase of shares pursuant to § 183i of the Act, as well as the transfer of assets to a shareholder pursuant to § 220p of the Act, constitutes a certain form of arrangement of property ratios and is comparable with other forms of arrangement of property relationships in marriage, in the community of owners of housing units or among joint owners in general. The Constitutional Court therefore takes the view that, like minority shareholders, the so-called main shareholder might have recourse to it in another position. It is also the owner and is also entitled to the protection of its property, company and business rights in the light of the Charter (Articles 11 (1) and (3), 26 (1) and (2)), which is a circumstance which the appellant omits. If each shareholder has the right to challenge the order of the general meeting (§ 183 in conjunction with § 131 (1) of the Act.), the risk of paralyzing the company's ability to act is borne by the main shareholder to a much greater extent. It is therefore a case of a conflict of fundamental rights and freedoms, not an expropriation within the meaning of Article 11 (4) of the Charter. This is the creation of an option for the general meeting to decide to change the structure of private ownership between shareholders (by analogy the German doctrine Schmidt-Aßmann, E.: Der Schutz des Aktieneigentums durch Art. 14 GG. In: Der Staat des Grundgesetzes. Festschrift für Peter Badura. Tübingen 2004, p. 1023), albeit under the supervision of the Czech National Bank and with guaranteed judicial protection. The fact that the State fulfils its protective function does not yet imply that it can be attributed to interference with minority shareholders' rights as in the case of expropriation. It is not an isolated measure in the legal order (cf. Section 142 of the Civil Code). However, if the State, within a public limited company, makes it legally regulated to purchase shares of a group of shareholders by another shareholder, such arrangements must comply with similar but not identical criteria as in the case of expropriation, because they are not expropriation. This concerns, in particular, the protection of the constitutionally guaranteed rights of minority shareholders, such as the protection of ownership within the meaning of Article 11 (1) and (3) of the Charter and the right to associate with others for business purposes pursuant to Articles 2 (3), 20 (1) and 26 (1) and (2) of the Charter.
54. On this basis, the Constitutional Court had therefore to assess, in the light of the principle of proportionality, the appropriateness and necessity of such a possibility of action by the main shareholder, since, in the present case, this is not primarily a conflict of public interest and fundamental law, but a conflict of two fundamental rights, where private law (owners) is against one another and not a public authority acting under the rules of Article 2 (2) of the Charter and a private law person acting under the rules of Article 2 (3) of the Charter. So-called crowding out or law of forced redemption, sometimes inaccurately referred to as squeeze-out or freezeout (see Garza, J. J. Rethinking Corporate Governance: The role of Minority Shareholders - A Comparative Study for the different meanings of these terms. St. Mary's Law Journal, 1999- 2000, p. 621- 625) is known to the laws of a number of countries, and this is even expected within the European Union by transposition of the 13th Directive. Somewhere, forced redemption is limited to public limited companies, such as in the Czech Republic, Germany, France, Italy, the Netherlands, Great Britain, Poland, elsewhere applies in general (in Austria Bundesgesetz über den Ausschluss von Minderheitsgesellschaftern - GesAusG. BGBl. I, No 75 / 2006), somewhere it applies only to companies with quoted securities, elsewhere also to others. The conditions under which displacement may occur also differ. However, the measure of the review activity of the Constitutional Court is not a contradiction or non-compliance of the contested legislation with foreign legislation, but a constitutional order. The fact that domestic legislation can provide a lower standard of protection for minority shareholders' rights does not necessarily mean that it is unconstitutional. However, nothing prevents foreign experience from becoming a source of inspiration for its improvement. The mere argument of the existence of this institute in other states is of no consequence in itself for the case to be dealt with, unless it is merely an addition to the constitutional argument. It cannot be assumed that an adjustment in a particular State is a binding model for other States. Finally, this has been demonstrated by the efforts made after certain unification within the European Union, which, after more than a decade of effort, resulted in the adoption of the 13th Directive in 2004.
55. Economic and legal reasons for the regulation of this institute are mutually conditional. Originally, the public limited liability company decided on the basis of the principle of unanimity and was based on the assumption that the law could not interfere with the circumstances of such a company. The so-called Vested Rights Theory was applied, which stood by the opinion that certain rights could not be waived by a partner without his consent. It has proved completely unsustainable in terms of economic needs since the end of the 19th century. It was therefore replaced by the principle of majority decision-making (Carney, W. J.: Fundamental Corporate Changes, Minority Shareholders and Business Purposes). Amarican Bar Foundation Research Journal, 1980, p. 69, 77n.). With the development of the economy, the increase in the number of equity companies and shareholders, the Tyranny of the minority with veto (Weiss, E. J.: The Law of Take Out Mergers: A Historical Perspective started to manifest itself on the basis of original ideas about the federal character and acquired rights (the conflict of membership strategy and investment strategy). New York University Law Review, No 1981, No 4, p. 627-657, for Great Britain p. 685n.). That is why the original ideas were gradually surpassed and developments led to the current situation, not only in the US but also in the individual developed European states, and since 2004 also within the European Union. What is important is that this process is regulated legally and clearly, which is different from the so-called wild displacement, where other means leading to this goal are used to push out minority shareholders, are not clearly regulated and allows for the sanctions of minority shareholders, whose share significantly exceeds 5% to 10%, as is the standard for forced redemption. At the same time, this institute is regarded as a legitimate addition to the adjustment of the mandatory takeover offers, which is regulated by Paragraph 183b (1) of the Act. (To this end, the Heir, J. et al.: Stock companies. 6.
56. It is essential for the Constitutional Court, in the case of forced redemption, that this economically sound procedure (rationality and appropriateness of intervention) is legally adapted as required under the rule of law (legality of intervention). It is therefore not necessary to examine the question of public interest in accordance with the same procedure as for expropriation (see also sub-sub-66 in the context of fixing the amount of compensation). The public interest is manifested in the principle of market economy and the freedom to conduct business by other means, including by creating appropriate legal conditions for the functioning of public limited liability companies. The main shareholder is not governed by the public interest within the meaning of Article 11 (4) of the Charter, as it is up to its discretion provided by the Commercial Code to decide whether to redeem the remaining shareholders, thereby becoming the only shareholder to decide on its own merits without the conduct of a general meeting and other public limited company law institutes. In the case of the law of forced redemption, it is not the usual decision in the general meeting. This is the majority of qualified and situated so high that the possible objections to abuse of status are already practically suppressed. When deciding on a qualified majority shareholder, minority shareholders may not even block the meetings of the general meeting in accordance with § 185 (1) of the Act, let alone prevent major decisions from being taken, whether they need to be taken as a simple majority (§ 186 (1) of the Act), qualified (§ 186 (2), (3) and (4) of the Act), or combined with a prohibition on majorisation (§ 186 (4) of the Act.). In a 9-to-1 share, it is not possible to talk about the de facto possibility for minority shareholders to influence the company's decision-making, it is only a possible de facto complication of its operation. The 90% requirement thus set far exceeds what is considered to be the control of the company from the point of view of Section 66a of the Act. In the light of the principle of proportionality, it is difficult to argue with regard to such a ratio if further bail-outs of the protection of property rights are respected in the context of the regulation of the forced redemption procedure (adequate compensation, legal protection).
57. Allowing forced redemption in the Commercial Code does not mean that a qualified majority shareholder will always consider it necessary to redeem the remaining shareholders. This is a matter for his business decision, which is limited by the deadline and conditions which, while not protecting the membership of minority shareholders (aspect of the right of association, freedom to conduct business and the possibility of decision-making) in a public limited company, will protect their existing shareholding in the form of shares, which is a condition of constitutional conformity of such an arrangement (Article 4 (4) of the Charter). In the first place, such an arrangement must lead the main shareholder to consider whether the use of his right granted to him by Paragraph 183i (1) of the Act would be worth the consideration, in a situation where the company is in full control. However, this stems from the above-emphasised economic nature of such a transaction, so there is no legal need to justify the decision on the actual use of the law of forced redemption (as opposed to the compensation for redemption). This follows from the concept of a market economy at present (compared to the situation until the mid-20th century when membership was protected), when it is expected that the majority shareholder himself will consider whether the cost of making a forced buy-out will bring him a profit (e.g. Schön, W.: Der Aktionär im Verfassungsrecht. Festschrift für Peter Ulmer. Berlin 2003, p. 1387-1388). The task of the State and its authorities (Česká národní banka, court) is not to examine the possible prospects of the correctness of the business decision, but to assess whether the legal conditions for carrying out such an action have been fulfilled and, where appropriate, to provide legal protection to the redeemed shareholders. Similarly, a link to the investor's strategic plan may be derived from Paragraph 183n (3) of the Act, where it is implicitly assumed that the investor will seek a 90% profit with that intention. If he did not do so immediately (three months), he is no longer able to do so.
58. The 90% threshold is the result of the legislature's reasoning, which could possibly set a lower threshold, as well as a higher threshold (95% in Germany, Poland, the Netherlands, France, Belgium, 98% in Switzerland). This was also the case in the Czech Republic in the event of the cancellation of the company without liquidation between 31 December 2001 and 11 July 2002 (the entry into force of Act No. 308 / 2002 Coll., amending Commercial Code). From the point of view of constitutional order and compliance with the State's protection function in the context of the arrangements for the mutual status of members, the limit of 90% is an expression of the necessary limits and does not raise doubts already with regard to the European standard, which may be considered as the boundaries contained in the 13th Directive and used in a number of other States. If the appellant (sub 6a) contests that the statement of the limit is inconsistent with the 13th Directive, reference should be made to what is stated in sub 28 and 48. From the point of view of the Constitutional Court, it is a matter of ordinary law and compliance with the condition of Paragraph 183i (1) of the Act is a matter of general courts, not a task of the Constitutional Court within the framework of abstract control of the constitutionality of the law.
59. As regards the appellant's objection (sub 7) that it is a breach of the European Convention, it should be noted that it is general, not specific in terms of the status of minority shareholders and merely repeating what is mentioned in other points of the proposal. The judgment in Bramelide and Malmström v Sweden, 1982, No 8588 / 79 and 8589 / 79, and in particular James and others v United Kingdom (sub-15). After that, however, this case concerns not the ownership of shares, but the setting of a price under the right to purchase flats in a long-term agricultural estate. The European Court of Human Rights, as well as the former European Commission on Human Rights, in the light of Article 1 of the Additional Protocol to the European Convention, also includes shares of public limited liability companies under the concept of assets (specifically the Sovtransavto Holding v Ukraine judgment of 25 July 2002 in paragraph 91). This, however, is not the subject of a dispute in the present case and none of the parties denies it. Similarly, the necessity to purchase minority shareholders is not a fundamental problem (see in Schreuer, Ch., Kribaum, U. The Concept of Property in Human Rights Law and Intellectual Investment Law. In: Human Rights, Democracy and the Rule of Law. Liber amicorum Luzius Wildhaber. Zürich etc. 2007, in particular p. 752-758; Frowein, J. A., Peukert, W.: Europäische Menschenrechtskonvement. 2. Kehl etc. 1996, p. 784), but protection against arbitrary core shareholders and sufficient legal protection (Bramelid and Malmström decision against Sweden of 12 October 1982 in fine). The very possibility of a law of forced redemption and its relationship to expropriation has already been taken up above. If the appellant further points to problems related to unclear legislation and insufficient legal protection, they will be given attention below.
60. Finally, it was necessary to consider a question which, although not listed by the appellant, is nevertheless relevant in terms of the nature of the public limited company itself, and in particular in terms of the way in which the law of forced redemption entered the law of the Czech Republic. Since the law of forced redemption is a relatively new institute of commercial law, it was necessary to assess whether there had been any interference with acquired rights and a breach of the principle of legal certainty. The Constitutional Court, in its caselaw, has dealt more than once with the protection of acquired rights and the principle of legal certainty and has stated that the characteristics of the rule of law are inseparably covered by the principle of legal certainty and the protection of the citizen's trust in law and that this procedure includes the prohibition of retroactivity (cf. In legal theory and practice, the difference between right and wrong retroactivity is made, since each of these types of retroactivity is regarded differently from the point of view of admissibility. In the event of false retroactivity, the new legislation leaves old legislation to address the issue of existing legal relations, in the past legal acts and claims arising therefrom, and only to the future changes the rights and obligations associated with these legal relationships. While true retroactivity is unacceptable, except for a few exceptions, false retroactivity is in principle acceptable. In the case under consideration, this is precisely the generally accepted false retroactivity. The adjustment of the forced redemption shall in no way affect the actual acquisition of participating securities and the rights attached thereto, arising before the entry into force of the adjustment adopted, which only provides for the imposition of an obligation on a minority shareholder to exercise his right of ownership, provided that the legally foreseen conditions are fulfilled, which, from a constitutional point of view, guarantee that such intervention is lawful. The repeal of the old and the adoption of the new legislation entails interference in the principle of the preservation of acquired rights and in the trust of the individual in law (cf. sp. zn. Pl. ÚS 21 / 96, Collection of finds and resolutions of the Constitutional Court, Volume 7, Found No 13, published under No. 63 / 1997 Coll.). Pursuant to Article VI of Law No 216 / 2005 Coll. the provisions relating to the compulsory purchase took effect on 1 July 2005, with the exception of the provisions of Sections 183i, 183k, 183l, 183m and 183n, which take effect on the date of its publication, i.e. on 3 June 2005. From the point of view of the constitutional rules on the declaration of laws pursuant to Article 52 of the Constitution, there has been no breach of constitutional order. In this respect, the Constitutional Court concludes that the principle of legal certainty does not necessarily include the inconsistency of legislation throughout the duration of the legal relationship. Law is a dynamic system that responds to the development and tendencies of society, and it is therefore necessary to recognise changes depending on its needs, in this case in the field of commercial law, which is gradually developed under the conditions of the Czech Republic by taking over the experience of the legislation of developed economies. This also applies to shareholders who acquired shares before 3 June 2005 and who could count on the possibility of taking over their shares by the main shareholder pursuant to § 220p of the Act. The law on the forced purchase of shares was not retroactive and occurred in a situation where a similar arrangement of so-called false displacement was already included in the Commercial Code.
61. In conclusion, the Constitutional Court points out that the legitimate expectations of the shareholder do not amount to such an intensity as the legitimate expectations of the owners of other assets, given that the very nature of the ownership of the shares does not guarantee the shareholders an immutable position or absolute equality of shareholders, since the extent of the ownership rights is derived from the number of shares of the same nominal value and the nature of the company implies the possibility of "risk 'of changing the position of its shareholders, in particular minority shareholders [cf. Resolution sp. zn. IV. ÚS 324 / 97 (Collection of Finances and Order of the Constitutional Court, Volume 10, Resolution No 8) and IV ÚS 720 / 01 (not published)]. The assessment of this question on the basis of tests known abroad (e.g. fair market value price, net asset value method, Delaware block method, earnings value method, reasonable expeditions test, deflated expeditions argument etc. - also sub 66, a distinction is also made between purchases within open or closed companies) is excluded in the framework of an abstract constitutional procedure as it may include an assessment of the investor's expectations only in general. In practice, however, such an investor is not - there is always a specific equity company in a particular situation (at the time of the purchase of the shares and at the time of the forced purchase, for buyers outside the company and within the company, the market price and the return price) and there is a specific situation on the capital market (the value of the share depends not only on the situation of the particular equity company). This question can only be addressed in the context of the procedure under Section 183i (5) of the Act. (Review by the Czech National Bank) and Section 183k of the Act. (Judicial protection of owners of participating securities). As part of the abstract control of the constitutionality of the law, it can only be assessed from the point of view of proportionality whether intervention is possible, necessary and desirable from the point of view of other fundamental law, whether there is protection at all and whether it is sufficiently guaranteed. The Institute itself of Forced Purchase of Shares under Sections 183i to 183n of the Act can therefore be considered as a measure whose implementation is within the limits of the constitutional order of the Czech Republic.
62. As regards the interaction between the main and minority shareholders in terms of respect for equality, it should be stressed that the concept of equality is in many different positions. Therefore, the mere lump-sum note on shareholder equality, irrespective of the nature of ownership of participating securities, is virtually meaningless. As mentioned above, the very nature of the ownership of shares does not guarantee the shareholders an unchanging position or absolute equality, since the extent of their ownership rights is derived from the number of shares of the same nominal value and the nature of the public limited company implies the possibility of "risk" changing the position of its shareholders, in particular minority shareholders (cf. Resolution sp. zn. IV ÚS 720 / 01). The status of shareholders in such a capital company cannot be mechanically passed on to other associations or in other forms of decision-making (e.g. electoral law). The shareholder's voting right is linked to the share (§ 180 (2) obch. zak.). Since the feature of a public limited company and its specificities are the possibility for one shareholder to have more shares (not one shareholder - one share of the same nominal value), the position and possibilities of the shareholders in that company differ. This concerns, in particular, equality in terms of the size of the share capital of a public limited company (the same nominal value of the share - the same number of votes - Paragraph 180 (2) of the Act.), so there is no question of any inequality in this regard. This would only be possible in situations where the Commercial Code establishes shareholders' rights regardless of the number of shares they own, such as the right to participate in the General Assembly, the right to vote, the right to information, the right to apply proposals and counter-proposals (§ 180 (1) of the Act), the right to protect them (§ 182, § 183 of the Act.). In this regard, however, the position of the main shareholder, whose investment may be threatened by the exercise of such rights, is being hampered. That is why, as has been explained above, it is constitutionally permissible for the main shareholder to consider whether to use the possibility of forced redemption. Therefore, the Constitutional Court did not find a breach of the principle of equality in this respect. A reference to Article 3 (1) of the Charter, according to which fundamental rights and freedoms are guaranteed to all without distinction of property, would be absurd in the present case, given the nature of the public limited company, and the appellant does not even claim it. Nor can it be concluded from Article 26 of the International Covenant on Civil and Political Rights, or from Article 14 of the European Convention, that the distinction in shareholder status with respect to the criterion of ownership of nine tenths of shares could be considered unreasonable and unobjective in the light of the above-mentioned consequences. It is essential from the point of view of the application of the prohibition on discrimination that the Commercial Code does not provide for any exemptions from the definition of the principal shareholder and minority shareholders. The possibility of a forced redemption by the main shareholder cannot be regarded as an unjustified advantage as it is based on rational and objective grounds (see above). Similarly, it is not possible to establish the existence of an unequal position of comparable groups of minority shareholders in terms of the same possibility of applying their shares to the same extent as can be done under the same conditions (legally defined) by a comparable group of other (other) minority shareholders (in addition to this, CCE 38 / 01, Collection of Finals and Order of the Constitutional Court, Volume 29, Found No 39, p. 355, published under No 87 / 2003 Coll.). The effects of the law on forced redemption are the same for all minority shareholders. Similarly, in such a situation, the obligation to make a takeover offer in the event of a certain degree of participation in the company's capital cannot be regarded as an interference with property law. In this context, however, the Constitutional Court points out that the balance of legislation on the status of minority shareholders would have contributed if the legislator had also adjusted their right in such a situation not only to have the right of the principal shareholder but also to purchase their shares at their request ("sell-out 'or" bid').
63. The issue of the maintenance of Article 11 (1) of the Charter, according to which the ownership of all owners has the same legal content and protection, should also be addressed. Nor can there be any distinction in the content of the rights of the shareholders. The decision-making method of the general meeting, based on the ownership of shares of a nominal value, shall be in full compliance with the nature of this type of business association referred to in Articles 11 (1) and (3), 20 (1) and 26 (1) and (2) of the Charter. If the Commercial Code provides for a different degree of protection for a minority in a public limited company depending on the importance of the decision taken (unanimity, nine tenths, three quarters, two thirds, a simple majority - Paragraph 183i (1), Section 186 of the General Tax Code.) and this is further linked to the mutual ratio of the shareholders (Section 66a of the General Tax Act.), there is no constitutional objection.
64. Compliance with Article 11 (1) The Charter on the same protection of property rights can only be assessed by assessing the position of owners in the same situations. Therefore, legal means of protection from other areas (e.g. property ownership) cannot be mechanically transferred to protect equity ownership. However, the appellant argues only by comparing the legal positions of the main shareholder and minority shareholders, which is only one assessment angle. The assessment of the position of minority shareholders in similar situations is equally important, but this argument lacks a proposal. Therefore, when further assessing the various objections of the appellant, the Constitutional Court, within the meaning of Article 11 (1) of the Charter, took into account the position of minority shareholders in the proceedings for the annulment of the public limited liability company with the transfer of capital to the main shareholder (§ 220p obchov.).
65. Most of the appellant's objections relate to the alleged lack of protection of minority shareholders' rights during the preparation of the forced redemption, in particular from the point of view of protection against abuse by the main shareholder. In particular, the Constitutional Court must emphasise that the appellant's claims are of a general nature and would have its place in the proceedings for a constitutional complaint by a minority shareholder if it were substantiated by the facts of a particular case. However, in proceedings for abstract control of the constitutionality of the law, the Constitutional Court is in a different position. According to Article 68 (2) of the Law on the Constitutional Court, in addition to the questions of competence and procedure, the content of the law is primarily assessed in the light of its possible conflict with the constitutional order [Article 87 (1) (a) of the Constitution], not its possible implementation by members or application by the Czech National Bank and the courts in practice. It should therefore be noted in the assessment of these objections that the Constitutional Court does not consider it excluded that the intervention in the constitutionally guaranteed rights of members, as well as the public limited liability companies themselves as legal entities of private law, may take place or take place. However, this is not the subject of the present proceeding. The repeal of the law can only occur when the applying authorities already use another interpretation (e.g. the finding of the sp. zn. Pl. ÚS 48 / 95, the Collection of finds and resolutions of the Constitutional Court, Volume 5, Found No. 21, issued under No. 121 / 1996 Coll.), thereby violating this constitutional obligation, and the constitutionally conformal interpretation is not considered. The mere possibility of another interpretation does not, in itself, give rise to any justification or unrationality of the proposal (cf. Resolution P.ÚS 6 / 03, Collection of finds and orders of the Constitutional Court, Volume 30, p. 18, p. 579). The Constitutional Court must therefore respect the type of procedure in which constitutionality is concerned (abstract control, specific control at the initiative of the General Court pursuant to Article 95 (2) The Constitution or the Accesorial Assessment pursuant to Section 74 of the Constitutional Court Act, when the alleged intervention had already taken place and the final decision had been taken).
66. The appellant's argument, regardless of the overall scope of the proposal (58 pages and other comprehensive annexes), can be summarised in a number of basis points, where the first point is the objection to the adjustment and the procedure for determining the compensation for the compulsory shares purchased. As has been said above, the issue of the registration procedure is set aside and dealt with in the proceedings under the sp. zn. In particular, the appellant contests the fact that the price is determined on the basis of an expert opinion, which was designated by the main shareholder. First, therefore, the Constitutional Court dealt with the question of how to define the amount of remuneration. The constitutional criterion is not Article 11 (4) of the Charter. In the present case, in view of what was stated above on the nature of the public limited company, the nature of the share and the nature of the law of the forced redemption, it is necessary to base itself on Article 4 (4) of the Charter and to take account of the nature and meaning of the ownership of the share. As stated by the Constitutional Court in the resolution sp. zn. IV. ÚS 324 / 97, the ownership of the share is associated with a certain risk. The constitutional imperatives of the protection of ownership and possible compensation for lost property are therefore, of course, different in the case of the protection of ownership of residential property, savings in the bank or in the case of ownership of the share. The share-owner must therefore assume that it is an investment which, by its nature, is linked to the right of business (only then to the right of association) and therefore also to the business risk. It can bring multiple profits, just as it can be completely degraded; all in different periods of time. Therefore, it is very difficult in general legislation to establish all possible criteria for establishing the share price.
The Commercial Code therefore selects in several places the turnover of the "reasonable 'price, which the appellant criticises when underlining the ambiguity of the basic attributes of compensation for shares, since the terms" proportionality' and "fairness of consideration 'are, in his view, subjective. The Constitutional Court did not identify with this view. The Commercial Code uses this concept in relation to the price of shares in several locations (§ 156 (4), § 183c (5), § 183g (1), § 186a (4), § 190c (1)). On the contrary, both concepts respect the possibilities of legal regulation. The law of the forced purchase refers to the proportionality of the price (§ 183k (1) and § 183m (1) of the Act) in connection with its determination. Paragraph 183j (2) of the Act provides for an obligation to submit in the invitation to the General Meeting, in the notice of its performance, also a statement by the Board of Directors as to whether it considers the amount of consideration to be fair. Notwithstanding the legitimate doubts about the legislative way of expressing the opinion of the Board of Directors (Stenglová, I.: Commercial Code. Comment. 11., C. H. Beck, Prague 2006, p. 672) it is clear that the Commercial Code foresees that the price can be determined by way of derogation from the company authorities' ideas. Adequacy indicates a requirement to take into account all relevant circumstances relating to the forced purchase. This means that from the point of view of the law it is excluded to be determined subjectively. This alone could lead to a decision on the unconstitutional nature of such legislation. The fact that the Commercial Code understands this concept as a guide to objective evaluation is already due to its judicial review; the price established not on the basis of objective criteria would be outside the scope of the judicial review. Finally, the exclusion of the non-constitutional subjective criterion can also be inferred from Act No. 36 / 1967 Coll., on experts and interpreters, in the form of a requirement of the impartiality of the expert, his expertise and exclusion in case of bias (§ 4, 6, 11). It is also possible to refer to the case law of the Constitutional Court on the questions of the bias of experts (e.g. found II. ÚS 35 / 03, Collection of finds and orders of the Constitutional Court, Volume 30, Found No 102), which, in particular, defined strict aspects for the assessment of expert opinions. The fact that the costs of drawing up the expert opinion are borne by the main shareholder cannot in itself lead to the general conclusion that these assessments are already defective, as the same objection could be raised if they were paid by a minority shareholder. If reference is made in the application in this procedure, but also in other countries (cf. Resolution of the Second Chamber of the Federal Court of Justice of 25 July 2005, sp. zn. II ZR 27 / 03, also in the observations of sub 32), to poor experience with certain experts, this cannot lead to a flat-rate conclusion that this would be contrary to the requirements of the Law on Experts and Interpreters. The Constitutional Court is aware that in practice, and also is aware of violations of these rules. However, this is no reason to declare unconstitutional legislation that can be interpreted and applied unconstitutional. For the same reasons, the Constitutional Court would then have to abolish, for example, the institution of custody, expropriation, dissolution of political party, etc. It is precisely because, in practice, constitutional conformity legislation may be infringed, that the right to judicial protection is ensured. Whether the price is reasonable is a matter of professional and impartial assessment. Since the opinion of the buyer and the buyer may differ, the procedure for examining such a price is modified by an independent and impartial body in the form of the Czech National Bank, which, given its nature, would not be sufficient. Therefore, protection in the form of a judicial decision is still guaranteed within the meaning of Articles 4 and 81 of the Constitution. Finally, it should be noted that there is no other approach in other countries. For example, the latest Austrian regulation (see § 1 Bundesgesetz über den Ausschluss von Minderheitsgesellschaftern, BGBl. I., No 75 / 2006) refers to" Gewährung einer angemessenen Barabfindung ', i.e. the provision of reasonable severance payments in cash, without any further provision (the same verbatim § 327a (1) of the German Stock Act but with certain criteria in other provisions). Attempts to find another way to determine this price in Germany, based on an irrefutable presumption of proportionality if it is accepted by at least 90% of the purchased shareholders, failed (see Stumpf, Ch.: Grundrechtsschutz im Aktienrecht. Neue Juristische Wochenschrift, 2003, No 1, p. 9). Therefore, the Constitutional Court did not find the inconstitutionality of the Commercial Code at this point.
It is a matter of practice what criteria will develop here. In this respect, the position of the former Securities Commission (sub 26) is marked. The fair market value used in the USA is also criticised in view of the multiple possible meanings and routes to be identified (see Fischer, D. R.: The Appraisal Remedy in Corporate Law. Therefore, judicial practice seeks a number of different so-called tests (see sub 61), which also changes over time. In this respect, in the US, public limited company law is regarded as a key legislature of the State of Delaware. His Supreme Court, in a precedent judgment, states that, regardless of the number of different tests, it will accept any reasonable method that will be widely accepted in the financial world [generally accepted techniques used in the financial community and the courts - Weinberger v UOP, Inc. 457 A.2d 701 (Del) 1983, available for example at www.nyls.edu / MBfs / WeinbergervUOP.pdf, where the court also dealt with the purpose of the merger].
67. Shares, as an expression of a share in a particular asset value, are subject to property rights. However, the protection of such a form of ownership is hardly comparable to the protection of immovable property (expropriation) on which Article 11 (4) of the Charter is based. The market situation and circumstances in the public limited company (e.g. the so-called starvation of small shareholders in the form of non-payment of dividends, loss of value due to non-tradeability, short-term employment over a certain period of time, etc.) have a major influence on its value. The fact that this is not an expropriation, as the appellant contends, with a view to demonstrating the public interest, means that when determining the amount of remuneration, the public interest is no longer taken into account. This has already been decided by the legislator in a generally binding manner. It should be added that, when expropriated in the public interest, the nature of the case is the specific sacrifice required for the benefit of the whole, in the case of forced redemption, in the light of what has just been said, the Constitutional Court does not find such a reason. It is an economic consideration of the buyer of the principal shareholder as to whether such a transaction will pay him off. In view of the economic dimension of the issue, reduced to an investment aspect, however, this also means that, unlike the expropriation of the family home, for example, it will not take into account the emotional aspects, social links and consequences, even if such aspects are not directly excluded (pension fund as a minority shareholder, environmental protectors in a public limited company that is a threat to the environment). The relationship with the share of the capital is out of the question. This is an uncertain investment which was intended to generate profits, but given the nature of the public limited company, it is an investment which does not have to guarantee profits.
68. What is a reasonable price can be determined by experts and on the parties by an independent procedure under the control of the Czech National Bank with the possibility of judicial review. In view of the circumstances of the buy-in associated with the acquisition of ownership, the adequacy of the price of quoted shares may never be below the market price. From this point of view, the turnover of a "different amount of consideration" in Paragraph 183k (3) of the Act must be understood only as a threshold under which it is not possible to go under in the context of judicial review. In other words, the court cannot reduce the amount of remuneration contested by the minority shareholder. The same applies to the procedure of the Czech National Bank according to § 183i (5) obch. zák. With regard to Article 11 (1) A different interpretation would be the disadvantage of a minority shareholder (reformatio in peius). Therefore, Article 183j (4) of the Act, according to which a motion for a resolution of the General Assembly must not derogate from the determination of the amount of the consideration according to the documents referred to in Article 183j (6) of the Act, must be interpreted in this constitutional manner. Otherwise, it would have to be abolished as unconstitutional. The expert's assessment of the proportionality of the intervention does not serve the protection of the main shareholder and the main shareholder cannot turn against it to the court; only minority shareholders are allowed to do so. If the main shareholder offers more, it is up to his business decision. As already pointed out above (sub 57), the decision taken by the main shareholder does not need to be justified as it is based on the assumption that, despite increased costs, the investment in the purchase of the remaining shares will pay off. This is not because it would obtain them at a more advantageous price, but also because, in view of the circumstances, the higher price that the board will have doubts about the overall situation of the company (Section 183j (2) of the Act.). In any event, the law cannot establish individual criteria for assessing proportionality in an exhaustive manner. This is a matter of professional assessment according to the financial and economic instruments and discussed by the Czech National Bank (see the opinion of the former Securities Commission No STAN / 13 / 2005 of 9.11.2005 on the issue of proportionality criteria and documents proving proportionality. It is noted that this opinion was not the subject of proceedings before the Constitutional Court as well as the practice of the Czech National Bank on its basis.).
69. For the determination of a reasonable price, the law provides for a procedure which is also the subject of the appellant's objections. Under Paragraph 183m (1) of the Act, the beneficiaries have the right to consideration in cash, the amount of which will be determined by the principal shareholder; the main shareholder shall demonstrate the adequacy of the remuneration by means of an expert opinion, which may not be more than 3 months old on the date of receipt of the application pursuant to Article 183i (1) of the Act, and the amount of which shall be reviewed by the Czech National Bank. The expert shall be collected and the costs of his activities shall be borne by the main shareholder (Section 183j (6) of the Act.). In this context, it should be pointed out that an impartial professional determination of a reasonable price should be considered as part of the protection of the ownership of the minority shareholder (sub-67). Therefore, its position must be comparable to that of other owners in a similar situation as that resulting from Article 11 (1) of the Charter (right of equal protection).
70. In such a case, it is the task of the Constitutional Court to assess whether such protection is provided at all (sub 68 and 69) and whether the level of such protection is comparable to that of other owners in a similar position. As such, the Constitutional Court was able to apply the procedure for the cancellation of a public limited-liability company with a transfer of capital to the main shareholder, as the transfer assumptions are the same as in the case of a forced redemption. In this case, however, Article 220p (2) of the Act provides that the main shareholder is required to provide the other shareholders with adequate cash settlement, the amount of which must be demonstrated by the expert's opinion. It refers to the similar application of the provisions of Paragraph 59 (3) and (4) of the Act. According to that provision, the amount of reasonable settlement shall be determined according to an expert's opinion "independent of the company appointed by the court for that purpose." The Constitutional Court therefore had to assess whether this difference in the method of determining the expert was so discriminatory in the case of forced redemption that the right of equal protection under Article 11 (1) of the Charter was infringed.
71. The Constitutional Court has concluded that, while such a fixed obligation on the main shareholder may make the position of minority shareholders difficult, but not in such a serious way as to be able to talk about the inconstitutionality of this regulation. It has already been pointed out above that the expert's position in the processing of the expert opinion and its necessary impartiality has been pointed out. However, this in itself would be completely inadequate if it had not been supplemented by the binding supervision of the Czech National Bank under § 183i (5) in conjunction with the appropriate application of § 183e obch. zák. This procedure applies to public limited liability companies with listed and unlisted participating securities, otherwise the same protection rule under Article 11 (1) of the Charter would also be infringed. Although, in the case of the Czech National Bank, it is already envisaged, in the light of its status, a distance from the members is desirable, it is nevertheless not a body which meets the requirements of Article 4 of the Constitution and Article 36 of the Charter. Since it is a protection of fundamental law, the integration of the Czech National Bank into the forced redemption process is not sufficient from a constitutional point of view. However, since Article 183k of the Act regulates the procedure from the point of view of the judicial protection of minority shareholders, the Constitutional Court considers that the fact that the expert's choice is the main shareholder in itself is a problem, but it is compensated by other measures by the State. However, there is no doubt that there is a need to consider a different procedure here because the task of regulation should be to the maximum extent to determine the possibility of litigation, and this regulation often leads to it. However, it must be pointed out that, even in Germany, to which the appellant refers, the situation is in practice such that an expert is appointed by the Land Court, according to the registered office of the company, generally on the basis of a proposal by the main shareholder, and the case law has not contested that procedure (cf. the Court of First Instance's judgment of 18 September 2006, sp. zn. II ZR 225 / 04, in particular paragraphs 14 to 17), although it is a very common plea.
72. The appellant also criticises the law of forced redemption that only the main shareholder is a party to the proceedings for prior approval of the Czech National Bank pursuant to § 183i (5) of the Act. In view of the distance between the Czech National Bank and its shareholders and the nature of the proceedings, it is not possible to reasonably ensure the participation of often thousands of minority shareholders, of which part is so-called anonymous (see Kotásek, J.: Displacing an anonymous shareholder. The magazine for legal science and practice, No 2006, No 3, p. 258- 259), can hardly be regarded as unconstitutional in itself, since the Czech National Bank does not directly decide on the forced purchase in administrative proceedings (only in this case would it be the equivalent of the expropriation procedure). That's the general meeting's jurisdiction. The Czech National Bank, in its capacity as an administrative body in proceedings under Section 183i (5) of the Act, may give rise to the State's liability for damage under Act No. 82 / 1998 Coll., on liability for damage caused in the exercise of public authority by decision or by maladministration and amending the Act of the Czech National Council No. 358 / 1992 Coll., on notaries and their activities (notarial order), as amended. Likewise, the appellant's objection to the fiction of the positive opinion of the Czech National Bank will not stand up from the point of view of constitutional order. This is not an unusual measure against administrative inaction. This regulation does not preclude the possibility for minority shareholders to apply to the court, as the amount of remuneration is always subject to judicial review, whether or not the State has complied with its obligations in terms of its supervision of the preparation of the forced redemption via the Czech National Bank. In addition, that provision (Paragraph 183e (9) of the Act) was neither contested by the appellant in the petition.
73. Furthermore, the remaining objections concerning the fixing of the level of the appropriate refund had to be examined. In the first place, the appellant contends that there is insufficient guarantee to pay the consideration for the shares purchased (sub-18), when even the addition of the provisions of Paragraph 183i (6) of the Act does not, in his view, remove a fully legitimate requirement that the payment of the amount of the consideration, as determined by the main shareholder, be sufficiently secured. The Constitutional Court did not identify with this objection. While there is no constitutional requirement for the obligatory debiting of funds to cover contractual obligations, it is not entirely common in law, but in this case it must be assumed that it is not a legal relationship arising from a contractual arrangement, but that ownership of shares is passed on by law. This obligation therefore also obliges the main shareholder to consider whether it will reach a forced buy-in, since it is, of course, linked to the increased cost of the services of a bank or a securities dealer. Therefore, from a constitutional point of view, this provision should be considered sufficient, despite the responsibility for its failure to comply, including the possible criminal liability. It should also be noted that the devaluation of funds under Section 183i (6) of the Act follows the confirmation of the General Meeting by the Czech National Bank pursuant to Section 183i (5) of the Act. The funds are therefore already secured after a possible increase in remuneration in accordance with the procedure laid down in Article 183e (8) of the Act. In doing so, the legislature has the possibility to change this adjustment should there be a case in the first place which, hypothetically, the appellant seeks to construct.
74. Finally, it is necessary to mention the lack of sanctions where, in the appellant's view, the legislation does not motivate the main shareholder to behave fairly, since it is not affected in any way for acts contrary to good manners (sub-11). The only risk is that it may have to pay off to several shareholders who have sufficient resources to conduct a dispute over consideration before the formal judges considering it. The requirement of legality and proportionality in the transfer of shares, in the procedure for reviewing the legality of the transition measures, and in the determination and examination of the level of remuneration is not respected. Nor could this objection be identified, since the Constitutional Court does not see a reason for which it is necessary to provide for additional special means of responsibility for the breach of the obligations of the main shareholder. From the point of view of constitutional order, it is essential that the funds are provided at all.
If the main shareholder makes use of the possibility of a forced purchase of shares provided by the law for the above reasons, he shall be allowed to behave and shall not abuse his right. The rules on the prohibition of abuse of the position of a shareholder under § 56a of the Act, with the possibility of procedure under § 131 of the Act of the General Assembly. (the annulment of the General Assembly resolution), of course, also apply to the forced purchase of shares. However, an abuse cannot be the legal acquisition of shares alone when a specified share of ownership of the participating securities in the company is achieved. It cannot be argued that such situations do not occur in the business environment of the Czech Republic and that, in particular, the use of judicial protection is sufficient compared to advanced economies. It is only in these states that their use is a real image of company law that cannot be understood without case law [Conard, A. F.: The Law of Companies. Michigan Law Review, No 1973, No 4, p. 648, states that, without case law, the common law was a poor ruckus. Nor can it be denied that the legislature may seek additional funds (cf. From the latest research, for example, the Liability Companies: Assessing the Need to Protect Minority Investors. The American Business Law Journal, No 43 / 2006, No 4, p. 609n., lists of solutions p. 639-646), but only the effective use of judicial protection can have a preventive effect in terms of attempts to abuse the position of a public limited company. However, this is not a very common phenomenon, not only for us, but also in other countries, where control of abuse also remains an option. This is also related to the fact that the law itself already admits forced redemption and there is no need to justify such a transaction (for example Kort, M.: Squeeze- out-Beschlüsse: Kein Erfordernis sachlicher Rechtfertigung und bloß eingeschränkte Rechtsmissbrauchskontrolle. Zeitschrift für Wirtschaftsrecht, dated 2006, No 33, zajm. p. 1520n., and for Austria Althuber, F., Krüger, A.: Squeeze- out in Österreich. Aktiengesellschaft: Zeitschrift für das Gesamte Aktienwesen, year 2007, No 6, p. 197n.). The Constitutional Court must therefore state on the objection of abuse that, in such a situation, it does not essentially matter to the motives of the main shareholder, because by abuse it would have to be an effort to obtain the 90% required. Even in the US, regardless of the possibility of an action for damages, such proceedings are not too successful with regard to expenditure on experts, experts and, in particular, legal representation (Seligman, J.: Reappraising the Appraisal Remedy. George Washington Law Review, No 52 / 1984, p. 860-864).
75. In this context, the appellant also pointed out that another aspect of the determination of the amount of the remuneration and the possible misuse of the forced redemption was not modified, i.e. the lack of interest for late payment of the remuneration under Paragraph 183m of the Act. It cannot be argued that such an obligation must be expressly enshrined in each case, given that it is still a private legal relationship. This, on the other hand, was necessary if the law wanted to rule out the application of the rules on commercial relations to relationships arising between members [e.g. § 369 of the Act, or § 340 of the Act, in conjunction with § 261 of the Act]. Therefore, in the event of default, interest on late payment is treated as the price of the money to which the law is entitled, pursuant to Article 1 of Decree No. 142 / 1994 Coll., which sets out the amount of interest on late payment and the late payment fee under the Civil Code, as amended by Decree No. 163 / 2005 Coll. At the same time, this can be seen as a penalty against the main shareholder, when interest on late payments is considered, in private law, to be a type of flat-rate compensation (cf. Knapp, M., Pvestka, J. et al.: Civil law material. 3rd edition of Prague 2002, p. 74, 125, 131).
76. With regard to the objections to the shortcomings of judicial protection, it should be seen that the differences between Member States, with a view to adjusting other aspects of forced redemption, lead to different provisions of the right to judicial protection. The review of the decision to make the forced purchase is limited by the following knowledge of practice (sub 79 and 80) in terms of protection against potential abuse. The setting of a 90% threshold already precludes doubts in this respect, and therefore the limitation of judicial review to further questions is acceptable. This proves the experience of states where these matters can be questioned in court. For the United Kingdom, there was once a significant number of lawsuits that were completely unsuccessful (already the classic work of Davies, P. L.: Gower and Davies' Principles of Modern Company Law. 7. London 2003, p. 746, is able to give just three examples where 90% of the shareholder has abused the law rather than used it). Therefore, the number of proposals gradually declined, regardless of the fact that Article 430 Companies Act 1985 supported the submission of such proposals, as it should have been a procedure without the obligation of minority shareholders to pay the fees, unless the proposal was unnecessary, inadmissible or burgundy. The same arrangement was essentially taken over by the new British Companies Act 2006 in Article 983. Similarly, in the US, the key judgment of Weinberger v UOP, INC (see sub-sub-66) states that, in the case of the so-called full fair test (entire fair test), the examination of fair treatment and fair price) of the finding of fraudulent conduct remains essentially a question of price assessment for the court to decide. The Continental System of Law then sets out most of the requirements that the US case-law makes in the form of general requirements directly in the law. From this point of view, the appellant's objections to the judicial protection of minority shareholders should be assessed if there is no possibility of a preliminary examination of the legality of the procedure in the exercise of the right of redemption. It is noted that the issue of the constitutionality of registration in the Commercial Register (§ 200da (3) o. s.) has been allocated to a separate procedure under sp. zn.
77. In particular, there is a unclear definition of the scope of the parties, the type of proceedings, the application and the termination of the right to rely on inadequacy of performance (see detail sub-paragraph 19). In relation to the first three objections, the Constitutional Court notes that this is an interpretation of ordinary law. It is a matter of judicial practice to resolve any alleged or actual ambiguities. If the appellant refers to the different positions of the two Supreme Courts in the light of the nature of the proceedings and thus the position of its parties, it is for the Supreme Court to resolve such questions in the course of its tasks in bringing the case-law into line. The Constitutional Court cannot carry out this task. This could exceptionally be done if the Supreme Court had ceased to fulfil that role (cf. the Constitutional Court's procedure at the time of the absence of the Supreme Administrative Court in relation to the case-law of the Regional Courts in administrative cases). The Constitutional Court may address such a question if the appellant claims that one of the interpretative options is unconstitutional. However, if the mere fact that there are two different interpretation options, without one being considered unconstitutional, does not open up the possibility of intervention for the Constitutional Court. It is the duty of the General Court to provide protection for fundamental rights under Article 4 The Constitution, by choosing an interpretation of constitutionally conformal, or in case of doubt, will turn to the Constitutional Court. The same applies to the appellant's objections that the provisions on the law of forced redemption contradict other provisions of the Commercial Code.
78. Furthermore, the appellant contends that the principle of equality of arms, protection of the weaker and access to the court is not respected. It states that even if the action by a minority shareholder were lawful, the original situation may not be restituted when there is a fait accompli created by registration in the Commercial Register. The Court of First Instance, which will rule on the matter, will base itself on the situation created and, in view of the principle of legal certainty and the protection of the rights of third parties, will have a tendency to reject the proposal to review the resolution of the General Meeting. Therefore, a review should take place before the transfer of ownership as in many other States. In the Czech Republic, this review is excluded according to § 131 (3) obch. zák., because with the help of § 131 obch. zák. is always looking for a reason to stop the proceedings or dismiss the action. In this context, however, the appellant does not, on the one hand, state specifically what the regulation in Section 131 (3) of the Act is, in fact, unconstitutional and finally does not propose its annulment. Paragraph 131 (1) and (2) of the Act does not preclude the annulment of the resolution of the general meeting on the transfer of participating securities to the main shareholder. Similarly, the appellant forgoes the process of a minority shareholder pursuant to § 131 (4) of the Act, which can be applied regardless of the application of § 131 (3) of the Act. However, this procedure cannot in any way call into question the Institute itself for the Purchase of Shares, which is established directly by law, as well as the absence of a minority shareholder in the register proceedings. The Constitutional Court considers that, from the point of view of proportionality, the legislation thus designed, i.e. the impossibility of the shareholder's participation in the register proceedings, referring to those other possibilities for the exercise of his rights in different separate proceedings, has, from the point of view of proportionality, its constitutionally acceptable grounds in the competition of the principal shareholder and minority shareholders (for the first time in resolution sp. zn. IV), the CUS 324 / 97, the CSA and the Constitutional Court's resolution, p. 10, p. 365, p. The failure to call into question the validity of the order of the general meeting by the inadequacy of the amount of the transaction (Paragraph 183k (4) and (5) of the Act) may be considered as a measure which does not contradict the construction of the law of the forced redemption and is rational, as it prevents in this way the judicial review of the actual acquisition institute, when any failure of the principal shareholder in the proceedings (e.g. CZK 1000 instead of CZK 990 per share) would constitute a declaration of invalidity of the general meeting with consequences for the protection of the rights of third parties and legal certainty (cf. § 131 (3).
79. According to the appellant, the principle of the protection of the weaker party is not respected in the context of the review of the level of consideration, since the minority shareholder under Paragraph 183k of the Act will be given the floor only when he has obstacles such as expert opinion, the opinion of the Czech National Bank and registration in the Commercial Register, without being able to participate in the proceedings or be a party to the proceedings. These objections cannot, in themselves, be regarded as a breach of the equality of the parties to the proceedings referred to in Article 37 (3) of the Charter and neither does the applicant indicate or indicate such infringement. These "obstacles' are only preconditions for the execution of the forced purchase. Nor can they serve to protect the interests of minority shareholders. The Constitutional Court merely notes, in the light of the above analysis of the nature of the compulsory purchase of shares, that the equality of the parties before the courts lies in the equality of their procedural rights, not in a position in a public limited company. This is based on a share in the number of shares of the same nominal value, and the guarantees of procedural equality in court proceedings cannot change anything. This also applies to another objection to the distortion - as the appellant calls it - of the principle of equality of arms in the form of a significant information deficit of minority shareholders in terms of the state of the company's assets and likely future economic results, where most of the assessments are based on the board of directors' documents. This is a claim that cannot stand under abstract control of the constitutionality of the law. These are specific conditions for the conduct of legal proceedings, where it would only be necessary to prove, in the context of an assessment of a particular case (e.g. in the context of proceedings on a constitutional complaint), that the procedural principles have been infringed.
80. As a further defect in judicial protection, the appellant sees the principle that the court is controlled in the review procedure only by a proposal from the applicant, which has little information enabling him to quantify the correct amount of remuneration within a short period of time. They claim that he is not forced to do so in Germany, for example. Moreover, there is the threat of paying the costs of the proceedings by those who succumb in the dispute. The court fee will be the higher the amount of the consideration in question. The Constitutional Court notes that foreign legislation may be more friendly with minority shareholders, but this does not automatically mean that domestic legislation is contrary to constitutional order. The argument of foreign legislation itself cannot be sufficient in this respect, in addition, it would require a much more detailed analysis than a mere voucher without further reasoning (see, in particular, the comments on Sections 4 and 15 in: Münchener Kommentar zum Aktiengesetz. 2., Sv. 9 / 1, § 327a - § 327f. AktG. WpÜG SpruchG. Munich 2004). It can undoubtedly be used in further modifications to the Institute under review. With regard to the guarantees of judicial protection provided for in Article 4 of the Constitution and Article 36 (1) However, it is essential in this respect that judicial protection is ensured, not whether it is granted as a precautionary measure. The State has some scope here to consider whether, under its terms, the possibility of an action will be brought before the general meeting's own decision. It shall also be entitled to decide on the conditions under which protection will be granted; However, it must be set up in such a way that it does not actually make its use impossible. See, for example, that moving the judicial control to the final stage also poses a significant risk to the main shareholder, which, as a result of the unfavourable decision, may suffer far greater losses than in the case of decisions at the initial buy-out stage. The legal fees referred to in this connection by the appellant cannot also be considered as an obstacle, even if there are States where, under certain conditions, the minority shareholder is not required (Article 983 Companies Act 2006, before Article 430 Companies Act 1985 and following its model § 15 (2) Gesetz über das gesellschaftsrechtliche Spruchverfahren. BGBl, 2003, p. 25, p. 838). It is up to the legislator to consider such an option, taking into account that the court fees perform a certain regulatory function in relation to the increase in litigation and the structure of minority shareholders in the Czech Republic. Moreover, the argument that the main shareholder is encouraged by this arrangement to set the value of the remuneration as low as possible and not to stand in general terms. The lower the price would be established (in the light of the expert's opinion and the opinion of the Czech National Bank, this is not possible in this way), the greater the risk of failure in court proceedings is exposed, including the payment of legal costs and damages.
81. Nor can we agree with the objection of a lack of protection of the rights of minority shareholders who have not applied to the court. The state cannot be blamed for not providing protection to someone who has not turned to it for protection. The Constitutional Court believes that an emancipated individual living in a free democratic society should be protected by excessive protectorial intervention by the State, and the expression of its maturity is precisely the ability to guard his rights in the spirit of the principle of vigilantibus iura scripta sunt, provided, of course, that the State provides him with adequate means to protect them. Therefore, this approach was not found to be unconstitutional in principle. Forced redemption is the right of the principal shareholder, who may not justify his business plan. It is up to him to assess whether he will make the purchase (sub 57). However, it must assume that it will buy out the shares of all minority shareholders at a value that will be determined by an objective, professional and impartial procedure, not just the shares of those who oppose the proposed amount of consideration. Similarly, it should be assumed that the court can decide on the amount of remuneration for each individual complainant minority shareholder in agreement. If our legislation did not foresee this, the construction of the economic basis of forced redemption would be called into question as a form of application of the basic right of the owner and entrepreneur. Paragraph 183k (3) of the General Tax Code must also be interpreted in this way, which is also rejected by the appellant because otherwise it would not be possible to protect the ownership of such shareholders. Similarly, the lack of a mechanism for the publication of a judgment by a court pursuant to Article 183k (3) of the Act cannot be regarded as interference with its property right under Article 11 (3) of the Charter or the right to judicial protection under Article 38 (2) of the Charter. It is for the minority owner to guard his rights when he is also informed of the possibility of intervening in the Commercial Bulletin pursuant to Government Decree No. 503 / 2000 Coll., on the Commercial Bulletin, as amended.
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Regulation Information
| Citation | The Constitutional Court found no 257 / 2008 Coll., on the application for annulment of Sections 183i to 183n of Act No. 513 / 1991 Coll., Commercial Code, as amended |
|---|---|
| Regulation Type | The Constitutional Tribunal found |
| Author | - |
| Collection | Code of Laws |
| Date of Promulgation | 14.07.2008 |
|---|---|
| Effective from | - |
| Effective until | - |
| Status | Valid |
The regulation text is for informational purposes only.
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