EU Sanctions: Preliminary Ruling on Shareholders Rights

Jul 11, 2025 Benn-Ibler Rechtsanwälte

The Austrian Supreme Court (Österreichischer Oberster Gerichtshof, hereinafter OGH) has asked the European Court of Justice to rule on whether EU law allows restrictions on shareholder rights if the shareholder is controlled by a person listed under the EU Sanctions Regulation.

The case at hand began in civil proceedings involving a Russian company that owned approximately 28% of the shares in a European company located in Austria. The Russian company contested several resolutions passed at the company’s general meeting under Section 195 of the Austrian Stock Corporation Act (Aktiengesetz, AktG). The company was prohibited from participating in the 2022 general meeting due to its control by a Russian individual listed under the Sanctions Regulation. Consequently, its voting rights were also revoked.

The OGH is requesting clarification from the ECJ on important EU law issues, especially regarding the term ‘frozen economic resources’ and its effect on stock corporation membership rights. The questions are:

1.  General exclusion of voting rights

Is it permissible to completely exclude a shareholder from voting rights, irrespective of the content of the resolution, if the shareholder is under the control of a listed person?

2.  Exclusion of voting rights for certain resolutions

If a general exclusion is not allowed: Is it justifiable to exclude voting rights for specific sensitive resolutions (such as the discharge of management board members or the appointment of supervisory board members)?

3.  Prohibition of AGM participation

Is attending the Annual General Meeting prohibited even without exercising voting rights?

The OGH stated that the key issue is interpreting Article 1(d), (e), (f), and (g) and Article 2(1) of Regulation (EU) No. 269/2014 in relation to company law rights, especially during a general meeting. The case was paused under Article 267 TFEU awaiting the ECJ’s decision.

The plaintiff’s challenge to the resolution is based on alleged procedural irregularities, in particular pertaining to exclusion from participating in the AGM and from voting. Under Austrian stock corporation law and the case law of the OGH such a challenge is only justified if a procedural irregularity would impair a specific interest of a shareholder in obtaining information or participating.

The exclusion of voting rights is only relevant for contestation if it could have influenced the outcome of the vote. However, exclusion from participation in the general meeting is considered a serious infringement of key shareholder rights, regardless of its causality for the outcome.

OGH 6 Ob 69/24a (18 February 2025)