PUBLIC LIMITED COMPANIES: THE RIGHT TO EARNINGS AGAINST THE RIGHT TO DIVIDENDS? THE RIGHT TO EARNINGS VERSUS THE RIGHT TO DIVIDENDS?

Abstract

Under article 93 a) of the Corporate Enterprises Act, share-holders have at least the right to participate in the distribution of corporate profits. The Spanish mercantilist doctrine distinguished between an abstract right to benefits and other specific dividends. Practice has shown that in Spanish stock companies, common shareholders have often seen the relationship between profits and dividends as a struggle between governing majorities and minorities (reservation policy benefits against that of the dividend). The emergence of non-voting shares and privileged shares alter the basic assumptions of the above-mentioned rights, as these, with some qualifications; have a legally enforceable right to a particular dividend, which lack ordinary shares. Furthermore, the currently suspended article 348 bis of the Corporations Act, which was valid until December 31, 2014, also recognized ordinary shareholders' certain right to the dividend.