?Majority Rule and Minority Protections: Theoretical Frameworks and National Practice in the Shadow of the EU: The Case of Ireland?

Abstract

Close corporations deserve separate attention from other company forms. Given that their shares are not publicly traded, there are often close bonds between shareholders and between shareholders and directors (who may overlap), particularly in smaller close corporations where a lack of separation between ownership and control is acute. This closeness is a fertile breeding ground for acrimony, often leading to shareholder disputes. There are circumstances where minority shareholders in a close corporation who are bound by the decisions of the majority may feel that either their interests or those of the company have been unfairly disregarded and that there is a risk of detriment or harm. Decision-making power and dominance may be abused to the detriment of the minority’s interests and also to those of the company. Therefore the law steps in to provide mechanisms to guard against the abuse of power by the majority. How this is achieved in Irish law is scrutinised in this chapter.