Проблеми на органното представителство при акционерното дружество по Търговския закон
Some Issues Concerning the Body Representation of a Joint-Stock Company under the Commerce Act

Summary/Abstract: The article studies the validity/voidance of self-deal transactions, in which a member of the board of a joint-stock company contracts with his or her company as well as transactions the company contract with a third party while a member of the board has an interest. A number of, but not all, self-dealing transactions for members of the board of a joint-stock company are treated by art. 240b of the Commerce Act (called hereafter "art. 240b"). It provides that a self-dealing transaction is valid, even if the responsible board of the joint-stock company has not given its consent for its conclusion. According to some court decisions, self-dealing transactions not covered by art. 240b should be referred to art. 38 of the Contracts and Obligations Act (called hereafter "art. 38"). Article 38 is a general Civil Law provision and according to it a transaction, which has been concluded by a person in his/her capacity as a board representative with himself or herself or with a third party represented by him/her is void, unless an explicit consent has been given by the represented person. The application of the two above-mentioned provisions to self-dealing transactions may lead to a contradiction-for similar cases two different legal principles shall be in force: the principle, which defends the represented person (art. 38) as well as the principle concerning the security of civil turnover (art. 240b). The article concentrates on the distinctions between the origin and type of representation under art. 38 and the representation of the body in a joint-stock company to reach the conclusion that they are different and that it is impossible to apply art. 38 to self-dealing transactions. On the basis of the analysis and the interpretation of other provisions in the Commerce Act the article makes the conclusion that the Commerce Act provides as a rule that self-dealing transactions are valid, unless the law states otherwise.

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