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§ 306. Competence of management board
- (1)
- The management board is a directing body of the public limited company which represents and directs the public limited company.
- (2)
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The management board shall, in directing, adhere to the lawful orders of the supervisory board. Transactions which are beyond the scope of everyday economic activities may only be concluded by the management board with the consent of the supervisory board. The management board is required to act in the most economically purposeful manner.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (3)
- The management board shall present an overview of the economic activities and economic situation of the public limited company to the supervisory board at least once every four months and shall immediately give notice of any material deterioration of the economic condition of the public limited company or of any other material circumstances related to the economic activities of the public limited company.
- (3
-
If a public limited company is insolvent and the insolvency, due to the company's financial situation, is not temporary, the management board shall immediately submit to a court a bankruptcy petition of the public limited company.
(06.06.2001 entered into force 07.07.2001 - RT I 2001, 56, 336)
- (4)
- The management board shall organise the accounting of the public limited company.
- (5)
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The specific work procedure of the management board may be prescribed by the articles of association.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
§ 307. Right of representation of management board
- (1)
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Every member of the management board may represent the public limited company in all legal acts unless the articles of association prescribe that all or some of the members of the management board may represent the public limited company jointly. Joint representation shall apply with regard to third persons only if it is entered in the commercial register.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (2)
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The right of the management board to represent the public limited company may be restricted by the articles of association or by a resolution of the supervisory board. A restriction on the right of representation shall not apply with regard to third persons.
(22.03.2000 entered into force 17.04.2000 - RT I 2000, 29, 172)
§ 308. Members of management board
- (1)
- A member of the management board need not be a shareholder. The management board may have one member (director) or several members.
- (2)
- A member of the management board must be a natural person with active legal capacity.
- (3)
- A member of the supervisory board, a bankrupt or a person from whom the right to engage in economic activity has been taken away pursuant to law shall not be a member of the management board. The articles of association may prescribe other persons who shall not be members of the management board.
- (4)
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The residence of at least one-half of the members of the management board must be in Estonia.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
§ 309. Election and removal of members of management board
- (1)
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The members of the management board shall be elected and removed by the supervisory board. In order to elect a member of the management board, his or her written consent is required.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (2)
- A member of the management board shall be elected for a term of three years unless the articles of association prescribe a shorter term.
- (3)
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The supervisory board may remove a member of the management board regardless of the reason, but the rights and obligations arising from a contract concluded with him or her shall terminate pursuant to the contract.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773; 17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)
- (4)
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The chairman of the supervisory board or a person authorised by him or her shall sign a petition for entry of expiry of the authority of a member of the management board or for entry of a new member of the management board in the register. The resolution of the supervisory board, the minutes of the meeting and the consent of the member of the management board specified in subsection (1) of this section shall be appended to the petition.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773; 17.06.98 entered into force 10.07.98 - RT I 1998, 59, 941)
§ 310. Substitute members
With good reason, a court may appoint a new member of the management board to replace a withdrawn member of the management board on the petition of the supervisory board, a shareholder or other interested person. The authority of the court-appointed member of the management board shall continue until appointment of a new member of the management board by the supervisory board.
§ 311. Chairman of management board
If the management board has more than two members, the members of the management board shall elect a chairman of the management board from among themselves, who shall organise the activities of the management board. The articles of association may grant the right to appoint the chairman of the management board to the supervisory board.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
§ 312. Prohibition on competition
- (1)
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Without the consent of the supervisory board, a member of the management board shall not:
- 1)
- be a sole proprietor in the area of activity of the public limited company;
- 2)
- be a partner of a general partnership or a general partner of a limited partnership which operates in the same area of activity as the public limited company;
- 3)
- be a member of a directing body of a company which operates in the same area of activity as the public limited company, except if the companies belong to one group.
- (2)
- If the activities of a member of the management board are in conflict with the provisions of subsection (1) of this section, the public limited company may demand that the member of the management board terminate the prohibited activity, transfer the income received from the prohibited activity to the public limited company and compensate for damage to the extent exceeding the claimed income.
- (3)
- The limitation period for a claim to terminate a prohibited activity and to transfer the income received from the prohibited activity shall be three months from the date the public limited company becomes aware of the violation of the prohibition on competition but not longer than three years after the violation of the prohibition on competition. The general limitation period shall apply to a claim for compensation of damage.
§ 313. Preservation of business secrets
- (1)
- The members of the management board shall preserve the business secrets of the public limited company.
- (2)
- The public limited company shall not claim compensation for any damage caused by violation of the obligation specified in subsection (1) of this section if the members of the management board acted in accordance with a lawful resolution of the general meeting or of the supervisory board.
§ 314. Remuneration of member of management board
Remuneration corresponding to the tasks of a member of the management board and to the economic situation of the public limited company may be paid to a member of the management board, the amount of and procedure for payment of which shall be determined by a resolution of the supervisory board.
§ 315. Liability of members of management board
- (1)
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The members of the management board shall be solidarily liable for any damage wrongfully caused to the public limited company or to shareholders by violation of the requirements of law or of the articles of association, or by failure to perform their obligations.
(28.05.96 entered into force 08.06.96 - RT I 1996, 40, 773)
- (2)
- The members of the management board who wrongfully cause damage to a creditor of the public limited company by failure to perform their obligations or unsatisfactory performance of their obligations shall be solidarily liable with the public limited company to the creditor.
- (3)
- The limitation period for assertion of a claim against a member of the management board shall be five years from the occurrence of a violation or from the commencement of a violation.
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