Majority Shareholder Abuse: How to File a Claim in Colombia

The Majority Shareholder Is Making Decisions That Harm You: Here Is What You Can Do

You attended the shareholders' meeting or partners' assembly, and the proposal you put forward—reasonable, backed by numbers, necessary for the company—was defeated in a block vote. Not because your arguments fell short, but because the majority group voted against it without engaging with the substance, as they always do. You later found out they had approved a contract with a company connected to the controlling shareholder on terms no arm's-length party would have accepted. And on top of that, dividends have gone undistributed for two years while administrative expenses for people close to that group keep growing quarter after quarter.

That is not poor management. It has a legal name: majority shareholder abuse. And in Colombia, it is actionable.

What Majority Abuse Is and Why Simply "Being in the Minority" Is Not Enough

Colombian corporate law recognizes that the majority rule is necessary for a company to function, but also that it can become an instrument of oppression. Abuse of voting rights occurs when majority shareholders or partners exercise their decision-making power to obtain a private benefit—or to cause harm—to minority shareholders, without that decision serving any legitimate corporate interest.

The Superintendency of Corporations (Supersociedades)—the entity with jurisdictional authority to hear shareholder disputes in Colombia—has developed a line of decisions recognizing this type of conduct as contrary to good faith and the duty of loyalty that every partner owes to the others.

What distinguishes abuse from a simple commercial disagreement is not the outcome of the vote, but the purpose behind it: does the decision benefit the company, or only the group that approved it? Was there an unjustified sacrifice of minority interests? Was there any real justification, or was the only argument "we have the votes"?

When It Applies: The Concrete Warning Signs We See in Practice

Not every dispute between shareholders constitutes majority abuse. What does constitute it, frequently, includes the following situations:

• Systematic refusal to distribute profits without genuine technical or financial justification, while reserves accumulate or funds are directed toward purposes that benefit the majority group.
• Contracts between the company and entities related to the majority shareholders on non-market terms—inflated prices, unjustified commissions, services that were never rendered.
• Amendments to the bylaws that dilute the minority shareholder's percentage, raise the quorum thresholds for exercising their rights, or strip away protections they originally held.
• Exclusion from positions or information to which a shareholder is legally entitled—access to corporate books, accountability reports, meeting notices.
• Decisions that harm the company as a whole in order to generate an external benefit for the controlling group.

The practical key is this: if the pattern repeats itself and the only common denominator is that it always favors the same group, that is where the case begins.

Practical Steps If You Believe You Are Facing This Situation

1. Document everything before taking any public action. Meeting minutes, financial statements, executed contracts, emails in which information was denied—all of this is evidence. The most common mistake we see is that the affected shareholder confronts the other side before having organized proof, at which point the other group begins to cover its tracks.

2. Review the bylaws and any shareholders' agreement. Many companies include conflict-resolution clauses, rights of first offer, or mandatory arbitration provisions that affect the available procedural route. Overlooking these could mean filing a claim in the wrong forum.

3. Identify the appropriate avenue. The Superintendency of Corporations has authority to resolve corporate disputes with the binding force of a court judgment, without the need to go through ordinary civil courts—which in many cases is faster and more specialized. However, the correct route depends on the type of company, the nature of the challenged act, and what the bylaws provide. There is no single answer that applies across the board.

4. Consider interim relief measures from the outset. If the conduct is causing active harm—a contract currently being performed that is harming the company, a decision being implemented right now—it is possible to request the provisional suspension of the challenged act while the merits are decided. The exact deadlines and requirements for interim relief depend on the specifics of your case; we can walk you through those in a full consultation.

5. Assess whether other legal dimensions are involved. Some cases of majority abuse are not purely corporate disputes. If company funds have been misappropriated or contracts have been simulated, the conduct may give rise to criminal or civil liability as well. At Consejurídico, our corporate, civil, and criminal practice areas work under one team, precisely to ensure that cross-cutting analysis is never overlooked.

What Happens If You Do Not Act

Time and the affected party's resignation are the majority abuser's greatest allies. While the minority shareholder waits to "see if it resolves itself," the harmful acts become entrenched, evidence disappears or becomes difficult to obtain, and the deadlines to challenge specific decisions may expire. The company may also be liquidated, restructured, or stripped of assets before any judicial decision is rendered.

What we see frequently: the shareholder comes to us when the damage is already severe and the procedural options have narrowed significantly. The majority of those cases would have had a better outcome had action been taken earlier.

The Next Step

If you recognize any of these situations in your company, the first step does not have to be costly or final: it is about understanding what you actually have, what options exist, and how strong your starting position is.

At Juri—Consejurídico's digital legal assistant—you can present your case right now, without an appointment, and receive genuine initial guidance from our team. If the analysis confirms there is a case worth pursuing, we will connect you directly with the firm's corporate lawyers to build the strategy.

#WeWantToBeByYourSide

Juri, our AI legal assistant, analyzes your specific situation. The initial review is free.