Limits to the automatic renewal of shareholders’ agreements

The Court of Appeal of Brescia, with its ruling no. 1568 of 08/10/2018, ruled on the subject of the automatic renewal of a shareholders’ agreement with a duration of five years, specifying that, with reference to art. 2341-bis of the Italian Civil Code, “in the agreement of indefinite duration, the rule provided that the shareholder may terminate the agreement at any time, by means of withdrawal adnutum with notice, thus avoiding the establishment of an unlimited compulsory obligation. In the fixed-term shareholders’ agreement, unlike what happens in an open-ended one, the possibility of withdrawal ad nutum at any time is not given; the legislator has therefore wished in this case to limit the extension in time of the obligation beyond the agreed expiration date, to this end establishing that each participant must have the mandatory right to be freed from it, by means of a simple expression of will, to be considered therefore always effective provided that it is communicated within the expiration date of the existing agreement.

This is done in order to prevent the parties from determining excessive limitations to the exercise of financial and business activities, in violation of the provisions of art. 41 of the Constitution”.