The Social Interest Involved in Ensuring that the Private Limited Company Operates Properly

Abstract

Social interest is not to be confused with the sum of the interests of the members, but summarizes the converging interests of the various categories of participants in the life of the company, both those of the members, as well as the interests of the administrators, auditors, employees, business partners, customers, etc. The refore, the social interest becomes one of the most important criteria for assessing the activity of the statutory bodies, especially the operations of administration and representation of the limited liability company in relations with third parties. The conformity of the full management operationswith the social interest is analyzed from the point of view of their usefulness, necessity and appropriateness for the company, otherwise the liability of the administrators may be engaged. At the same time, the social interest underlies the principle of the good manager, the "prudent business man" and diligent, who in making business decisions acts honestly and loyally to achieve the purpose of the limited liability company. The use of this standard also within the limited liability company enables the partners to ensure that the directors have sufficient freedom of action in carrying out management operations, avoiding the company's involvement in risky operations. As a result, the complexity of the limited liability company's activity requires more rigorous regulation of the function of administrator, the rule referring to the legal regime for administrators of partnerships being insufficient and the prohibition on the application of the rules on the administration of public limited companies being totally inadequate. In this regard, we are prepared to make a number of proposals by law ferenda in this article.