The case of controlling shareholders who use their limited liability company to pursue personal interests may be sanctioned under Slovene law.
First, as explained above, such shareholder’s conduct may be used as a basis for lifting the corporate veil, if the shareholder uses their limited liability company to pursue personal interests in order to attain an objective that is forbidden to them as individuals.
Second, such a shareholder’s conduct may give rise to a claim for the shareholder’s exclusion from the company pursuant to Slovenian Companies Act. Any shareholder may file an action against a company pursuing the exclusion of another shareholder if they demonstrate “well-founded reasons” for exclusion. A pursuit of personal interests undoubtedly represents well-founded reasons for exclusion. The Higher Court of Ljubljana has ruled that when a shareholder acting as a director of a company transfers a large part of a company in pursuit of personal interests, without the participation of other shareholders, represents a well-founded reason for the shareholder’s exclusion (judgement of the Higher Court of Ljubljana no. I Cpg 1545/2013, dated 13.05.2014).
Third, when the controlling shareholder appoints themselves to the position of a director of the company in pursuit of their personal interests, they may be personally liable for damage to the company as a whole. Slovenian Companies Act stipulates that a director must, in performing their duties on behalf of the company, act in the best interests of the company. If the shareholder acting as a director disregards the best interests of the company to pursue their personal interests and, in doing so, causes financial loss for the company, they may be personally liable for damages to the company. In this way, the result for the shareholder is the same as in the case of “piercing the corporate veil”.
Fourth, under Slovenian Companies Act, the shareholders of a company are liable for damage caused to the company intentionally or through gross negligence. Further, pursuant to Slovenian Companies Act, a shareholder may file an action in their own name, but on behalf of the company, against another shareholder that failed to meet their obligations in the management of the company (so-called “actio pro socio”). These provisions are mostly useful for minority shareholders who may not be able to achieve the majority needed to force the company to start proceedings against a shareholder for failing to meet their obligations.