Disputes between shareholders usually arise over situations nobody arranged in advance: who decides when you disagree, what happens if someone wants to stop and whether the division of shares still feels fair. You prevent a lot by answering those questions while relations are still good. Record the answers in the articles of association and in a shareholders' agreement.
In short
- No contract foresees everything. That is why it must be settled in advance who decides when the agreements are silent, and how someone can leave.
- A division of shares that feels unfair sets off a negative spiral. An equal split is not automatically a fair one.
- If you cannot work it out together, the court can order a shareholder to transfer or take over shares. That is the last step, not the first.
In this article
Why do shareholders fall out?
Usually because something happens that the agreements say nothing about. No contract can foresee every future situation. In those gaps, the struggle over who is in charge begins.
Economists call this the problem of incomplete contracts. Grossman and Hart showed that it is too costly to list all rights in a contract in advance. That is why ownership matters so much: the owner holds the residual rights of control, the right to decide on everything that is not in the contract (Grossman & Hart, 1986).
With two or more shareholders, those residual rights are shared. As long as everyone agrees, you do not notice. But with a setback, a growth opportunity or a wish to leave, someone has to decide. If it is not settled who that is, every difference of opinion becomes a question of power.
Should you divide the shares equally?
Not automatically. An equal split is quick and feels friendly, but does not always match what each person contributes. What matters for relations is whether everyone experiences the division as fair.
Hellmann and Wasserman studied 1,476 founders in 511 young companies. Teams split the shares equally less often when the founders differed strongly in who had the idea, previous experience as an entrepreneur and the money they contributed. Teams that split equally received a lower valuation on average in their first financing round. That effect was stronger in teams that had decided quickly on the division. According to the researchers, this is not due to the equal split itself, but to differences between the founders that cannot be seen from outside (Hellmann & Wasserman, 2017).
The researchers also estimated what stronger founders leave on the table if they still agree to an equal split. That is about 10% of the value of the company, or 25% of the average founder's stake (Hellmann & Wasserman, 2017). Whether such a gap later leads to tension depends on how fair the division feels.
Why is a fair division so important for working together?
Because the sense of fairness sets the tone for everything that follows. A division that feels fair starts a positive spiral in the cooperation. A division that feels unfair starts a negative one.
Breugst, Patzelt and Rathgeber followed eight entrepreneurial teams for six months. How fair the team members found the division of shares turned out to be key to how they dealt with each other and to important outcomes for the company. A sense of fairness led to a positive spiral, a sense of unfairness to a negative one (Breugst, Patzelt & Rathgeber, 2015).
One finding deserves extra attention. Teams that came under pressure from outside slid from a positive to a negative spiral, even if they still found the division fair (Breugst, Patzelt & Rathgeber, 2015). So a good division does not protect against everything. That is exactly why it helps to also record what happens when things go badly.
Is every disagreement between owners harmful?
Personal conflicts are clearly harmful. Strong conflicts about the content of the work also turn out in research to harm more often than they help. They do the least damage when they do not become personal.
A meta-analysis, a study that combines the results of many earlier studies, looked at conflicts in teams. Relationship conflicts, disputes about who someone is and how they behave, were strongly associated with worse performance and less satisfaction. Contrary to expectations, the same applied to task conflicts, disagreements about the work itself. Task conflicts were least harmful when they stayed separate from relationship conflicts (De Dreu & Weingart, 2003).
Note: this is an association, not proof that one causes the other. The practical lesson is clear, though. The more you have arranged in advance, the less there is to fight about on content. And the less fighting on content, the smaller the chance that it becomes personal.
In family businesses this plays an even larger role. Kellermanns and Eddleston describe in a theoretical model how family ties, control and the involvement of several generations determine which conflicts arise. According to their model, a relationship conflict can strongly colour the outcome of business disagreements (Kellermanns & Eddleston, 2004). In a family, business and personal matters get mixed up more quickly.
What do you record in advance, and where?
You record the basic rules in the articles of association and the additional agreements in a shareholders' agreement. The articles of a private limited company (bv) are drawn up by the notary. A shareholders' agreement is not compulsory, is only possible when there are several shareholders, does not require a notary and is not public (Ondernemersplein, 2026).
Note the order of priority. If the shareholders' agreement says something different from the articles, what is in the articles usually applies (Ondernemersplein, 2026). Important agreements on control and leaving should therefore also be reflected in the articles.
Use the lessons from the research as a checklist. Above all, arrange the situations in which the residual rights of control would otherwise quickly lead to a fight:
Who decides if you cannot agree?
Agree which decisions need unanimity, which a majority, and what happens in a deadlock.
How can someone leave, and at what price?
Record who may or must buy the shares and how the value is determined.
What happens on death or long-term illness?
Agree whether the shares must then be offered to the other shareholders, and at what price.
What does each person contribute, and what do they get for it?
Divide the shares according to contribution, experience and money, and discuss it calmly rather than quickly.
What does the company do with its profits?
This can be arranged differently in the shareholders' agreement than in the articles.
What does the law provide if you cannot work it out together?
The law offers a few ways out, but they are heavy. A shareholder can be forced to transfer their shares, or can demand that the others take over their shares. For that you have to go to the Enterprise Chamber of the Amsterdam Court of Appeal.
If a shareholder wants to sell, they must first offer their shares to their fellow shareholders, unless the articles provide otherwise. They can then ask for a price set by independent experts (art. 2:195 of the Dutch Civil Code). This offer rule prevents an unknown shareholder from simply joining.
In a real conflict there are the dispute rules. Shareholders who together hold at least one third of the capital can ask that a fellow shareholder transfers their shares. This is possible if that shareholder harms the interests of the company so much that their staying cannot reasonably be tolerated (art. 2:336a of the Dutch Civil Code). Conversely, a shareholder whose interests have been harmed so much that staying cannot be asked of them can demand that the others take over their shares (art. 2:343 of the Dutch Civil Code).
If there is doubt about whether the company is being run properly, the Enterprise Chamber can order an investigation into its policy and conduct of affairs. This is called the right of inquiry (art. 2:345 of the Dutch Civil Code). All these routes go through the court. They settle a conflict, but rarely restore the cooperation. Agreements you make in advance do.
Sources
- Grossman, S.J. & Hart, O.D. (1986). The costs and benefits of ownership: A theory of vertical and lateral integration. Journal of Political Economy, 94(4), 691-719. doi.org/10.1086/261404
- Hellmann, T. & Wasserman, N. (2017). The first deal: The division of founder equity in new ventures. Management Science, 63(8), 2647-2666. doi.org/10.1287/mnsc.2016.2474
- Breugst, N., Patzelt, H. & Rathgeber, P. (2015). How should we divide the pie? Equity distribution and its impact on entrepreneurial teams. Journal of Business Venturing, 30(1), 66-94. doi.org/10.1016/j.jbusvent.2014.07.006
- De Dreu, C.K.W. & Weingart, L.R. (2003). Task versus relationship conflict, team performance, and team member satisfaction: A meta-analysis. Journal of Applied Psychology, 88(4), 741-749. doi.org/10.1037/0021-9010.88.4.741
- Kellermanns, F.W. & Eddleston, K.A. (2004). Feuding families: When conflict does a family firm good. Entrepreneurship Theory and Practice, 28(3), 209-228. doi.org/10.1111/j.1540-6520.2004.00040.x
- Ondernemersplein (Netherlands Chamber of Commerce and government), Drawing up, amending and requesting articles of association, consulted 14 October 2026. ondernemersplein.overheid.nl
- Dutch Civil Code book 2, article 195 (offer rule), version in force from 1 July 2026. wetten.overheid.nl
- Dutch Civil Code book 2, articles 336a and 343 (dispute rules), version in force from 1 July 2026. wetten.overheid.nl
- Dutch Civil Code book 2, article 345 (right of inquiry), version in force from 1 July 2026. wetten.overheid.nl