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Alexander Singer on his 2008 published book by the renowned Manz publishing house in accordance with Austrian law “GESELLSCHAFTERSTREIT vermeiden oder gewinnen” (“SHAREHOLDER DISPUTES prevent or win”)

For over 30 years I have had the opportunity (and have been obliged) to get to know shareholder disputes from different angles: Previously, as an entrepreneur, I myself was affected by shareholder disputes on three occasions. Now, as a lawyer, I accompany shareholders, management and supervisory board members – sometimes even founders (and/or beneficiaries) or the foundation board – through a variety of shareholder disputes.

This book is primarily aimed at prospective or active shareholders and management, who want to prevent shareholder dispute litigation where ever possible, or who have had to enter into litigation and want to win. It is aimed less at lawyers and other advisors who are looking for a dogmatic solution. Lawyers and other advisors in search of practical experience (particularly concerning the strategic considerations as well as the psychological elements of shareholder disputes), will find this book very useful.

This book seeks to raise awareness and to improve your ability to detect potentially contentious issues early on. No book can ultimately offer a solution to a specific shareholder dispute, or provide a remedy in the case of shareholder dispute litigation, since each shareholder dispute is driven by different personalities, and will have different causes and its own dynamics. Therefore, every shareholder dispute requires an individual solution. For this reason, my book is not intended to be exhaustive in nature, nor is it a substitute for the use of advisors. Accordingly, the book does not examine company incorporation or the essential elements of an upstanding company, but instead focuses on those elements that are important in preventing or dealing with shareholder disputes.

Most shareholder disputes occur in relation to GmbHs (limited liability companies), which are the main focus of my book. Other types of companies are not, however, overlooked – in particular partnerships and joint-stock companies, but also private foundations, which have already outnumbered joint-stock companies in Austria. Many of the statements, comments and explanations for these types of companies also apply to corsortiums – an important type of business partnership especially in the implementation of major projects, which is usually organised as a civil law partnership (“GesbR“).

With a view to improving the reader’s understanding, my book describes important procedures mostly objectively, and takes into account the perspectives of the various parties, especially where different consequences will result. Read these objective descriptions from the point of view of your own situation. You will come to understand your options in terms of what action you can take, and what action you can expect the other side to take.

Some statements might indeed appear to be trivial and common sense at first glance. Practice shows, however, that shareholders recognise the relevant topics as being obvious in retrospect, yet they fail to make the same observations in advance, or simply overlook them all together. You stand to gain a lot by becoming aware of what you already knew all along.

The structure of this book is based on the “life cycle“ of a company. In chapter 3 you will find considerations that should be taken into account prior to incorporation, chapter 4 deals with the incorporation process itself, chapter 5 contains useful measures that can be used to prevent disputes throughout the company’s existence before a shareholder dispute breaks out, or rather it suggests preparatory measures that can be used as a safeguard for the event of a shareholder dispute. Furthermore, chapter 6 presents recommended measures and strategies for use after a shareholder dispute has broken out. This structure should enable you as a reader to open the book at the chapter that is most relevant to your situation, but also requires a number of references and a repetition here and there.