Management of a Child’s Shares in a Limited Liability Company

Abstract

Abstract A minor may possess property. The management of such property takes place under the regime of the Family and Guardianship Code (krio), which subjects the management activities exceeding the scope of ordinary management to the control of the guardianship court. Due to the development of the market economy, in many cases shares in the share capital of a limited liability company become the child’s property. Actions within the scope of exercising the child’s shareholding rights in a limited liability company require the prior consent of the guardianship court. Such a solution does not provide adequate protection of the child’s property, because the guardianship court does not have instruments allowing it to actually monitor the economic legitimacy of the actions taken. It also does not meet the requirements of the modern company transactions, which, in consequence, may lead to violation of the child’s financial interest. There is a need, therefore, to consider the possibility of changing the current model of managing the child’s shares in a limited liability company. It seems that the change could be aimed at entrusting the management of shares to a person who has knowledge and skills in terms of functioning of commercial companies and is monitored by the guardianship court, which would periodically evaluate the economic effectiveness of the management actions taken by that person.