At the end of March 2025, the period for holding the ordinary meetings of companies came to a close, in accordance with Article 422 of the Commercial Code, which requires such meetings to be held within three months following the end of the fiscal year, unless otherwise stipulated in the bylaws.
Monday, March 31, 2025, was the last day on which annual ordinary shareholders' meetings of Colombian companies could be held to make decisions such as the approval of the financial statements for the last fiscal year, the approval of the management report by the administrators, and the distribution of profits, among others.
In the event that the Shareholders' Assembly could not be held within the legally established period for various reasons — such as, for example, the meeting not being duly convened, or, although properly convened, it could not be held due to lack of quorum — the Commercial Code, in Articles 422 and 429, regulates 'statutory right' meetings and 'second-call' meetings in the following terms:
‘‘Article 422. Ordinary meetings of the Shareholders' Assembly shall be held at least once a year, on the dates established in the bylaws, or, if the bylaws are silent, within the three months following the end of each fiscal year. These meetings are held to examine the company’s situation, appoint directors and other officers within its authority, determine the company’s economic guidelines, review the accounts and financial statements for the last fiscal year, decide on the distribution of profits, and adopt any measures necessary to ensure the fulfillment of the company’s corporate purpose. If the meeting is not convened, the Assembly shall meet by statutory right on the first business day of April at 10:00 a.m. at the company’s main office where management operates (…).
The statutory right assembly is a type of meeting whose holding is expressly mandated by law, as it only applies in cases where the respective ordinary meeting has not been convened. Furthermore, it is mandatory that this meeting be held on the first business day of April at 10:00 a.m. at the company’s registered office. No alternative conditions may be agreed upon, as has been clearly stated by the Superintendence of Companies in Official Letter 220-032657 dated February 22, 2024, and in Section 3.2.3 of the Legal Basic Circular of the Superintendence of Companies, which states:
Statutory Right Meetings: These are provided for by law and must be held on the first business day of April at 10:00 a.m. at the company’s principal office where its management operates, in cases where, for any reason, the ordinary meeting of the company’s highest corporate body has not been convened.
These conditions may not be modified by private agreement (…)
On the other hand, the second alternative applies to both ordinary and extraordinary shareholders' meetings. It is only applicable when the meeting has been duly convened but could not be successfully held due to a lack of quorum, meaning that the decisions listed on the agenda could not be made. Article 429 of the Commercial Code provides:
Artículo 429. If the shareholders' meeting is convened but cannot be held due to lack of quorum, a new meeting shall be called, which may validly convene and make decisions with any number of shareholders present, regardless of the number of shares represented. The new meeting must be held no earlier than ten days and no later than thirty days from the date scheduled for the first meeting.
When the assembly meets in an ordinary session by statutory right on the first business day of April, it may also deliberate and validly decide under the terms of the preceding paragraph.
In companies whose shares are traded on the public securities market, at second-call meetings the assembly shall validly convene and make decisions with one or more shareholders, regardless of the number of shares represented.
Article 3.2.4 of the Legal Basic Circular of the Superintendence of Companies establishes the requirements for this type of meeting to take effect: 1. The meeting must have been duly convened and not held due to lack of quorum; 2. The meeting must be reconvened; 3. The timing for holding the meeting must be observed (not less than 10 days and not more than 30 days from the date of the first meeting); 4. There must be a plurality of shareholders to decide with any number of shares, quotas, or interest units, provided that special majorities are respected. This last requirement does not apply to Simplified Stock Companies (S.A.S.)
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