Our March edition takes a closer look at another type of corporate litigation. This time, we focus on the Czech Supreme Court Decision in Case No. 27 Cdo 1782/2025 and the conditions under which a shareholder may bring an action for the provision of explanation and the role played by supervisory board review in this process.
In the case at hand, a shareholder sought a court order requiring the company to provide explanations regarding matters discussed at a general meeting. Specifically, the request concerned questions related to the company’s business activities and the status of its assets and liabilities – information necessary to assess the items on the agenda.
The board of directors did not decide regarding the request directly at the general meeting and subsequently refused to provide the information, referring to the protection of business relationships, competitiveness, and other obligations of the company. At a substitute general meeting with an identical agenda, the shareholder raised the request again. The chairman of the supervisory board expressly supported the board of directors’ position and indicated that he was presenting the supervisory board’s view.
The appellate court dismissed the action, concluding that the shareholder had failed to meet all of the required conditions for bringing the action. In its view, it had not been demonstrated that the supervisory board, as a collective body, had reviewed the refusal to provide information. Without such formal review, the shareholder could not seek judicial protection.
The Supreme Court rejected this formalistic approach. It emphasised that the requirement for prior review by the supervisory board serves, in line with the principle of minimising judicial interference in the internal affairs of a company, to ensure that shareholders first exhaust the remedies available within the company itself.
Where the supervisory board, or its chairman, clearly communicates at the general meeting that it does not agree with providing the requested information, the purpose of that review is fulfilled in substance. A shareholder should not be disadvantaged by the fact that the supervisory board may not have formally adopted its position in a procedurally flawless manner as a collective body.
The decision confirms an important practical point: the requirement of supervisory board review cannot be interpreted in a purely mechanical or formalistic way.
The decision therefore confirms that the requirement for supervisory board review cannot be interpreted in a purely mechanical or overly formalistic way. At the same time, however, it underscores that all other statutory conditions must still be carefully observed. It is not sufficient that a shareholder simply did or did not receive an explanation at the general meeting. In practice, it will always be necessary to assess whether the information was requested in relation to matters actually discussed at the meeting, whether it was necessary for evaluating those matters or for the exercise of shareholder rights, whether and at what stage the request was refused, whether a supervisory board review took place, and whether the action was filed within the applicable statutory time limit.
This case once again illustrates that proceedings concerning the provision of explanation are determined not only by their substantive merits, but often by the precise fulfilment of procedural requirements. In corporate disputes, such details can prove decisive. At HAVEL & PARTNERS, we regularly encounter these issues in practice.
