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Shareholder disputes: mediation, negotiated exit and arbitration before court

When a conflict between shareholders is out in the open, a lawsuit is not the only route. How mediation, negotiated exit and arbitration work, when they can be used, and what they can and cannot achieve.

Strategic editorial team 12 August 2026 8 min read

Cover: “Shareholder disputes: the routes before court”, Shareholders and governance

When a dispute between shareholders has broken out, there are three routes before a lawsuit. The first is mediation before an accredited body. The second is the negotiated exit of one of the shareholders. The third is arbitration, if the articles of association or an agreement between the parties provide for it. All three are more confidential than a trial and, if taken early, leave a better chance of saving the company. None of them can guarantee an agreement, and all of them require the parties’ lawyers.

A typical scenario. Two people found a company together, divide up the roles and grow side by side for years. Then one of them starts copying their own lawyer into email replies. Nobody says it out loud, but from that moment every operational decision becomes a negotiation. Suppliers notice, and so do the banks. Employees notice first.

Why is waiting the real cost?

A shareholder dispute is a conflict over the rights, roles or future of the company that the shareholders can no longer resolve on their own. Anyone who has been through one knows that the most damaging part is rarely the court case. It is the period before it, when nobody decides, nobody signs and nobody takes responsibility for saying that things cannot go on like this. In that grey zone customers are lost, investment stalls and the best managers leave.

Some signs show that the conflict is already affecting the business, even if nobody admits it:

routine decisions require extraordinary meetings
everything goes through in writing, even what used to be said face to face
one shareholder builds a parallel version of events with employees or suppliers
lawyers appear before there is even a proposal
people ask for copies of documents and minutes that nobody had ever asked for before.

Once the conflict comes into the open, with a formal warning letter or a rumour going round the industry, handling it discreetly becomes much harder.

What are the routes before court?

	Mediation	Negotiated exit	Arbitration
What it is	A procedure with a neutral mediator, before a body listed in the register kept by the Italian Ministry of Justice	A negotiation between the parties, assisted by their lawyers and advisers, for one shareholder to leave	A private judgment, in which one or more arbitrators decide the dispute
When it can be used	Always, if the parties choose it. In some matters it is mandatory before going to court. The articles of association can provide for it	Always, if the parties want to negotiate	Only if there is an arbitration clause in the articles of association or a written agreement between the parties
Who decides	The parties	The parties	The arbitrators
Confidentiality	The procedure is confidential by law	It depends on the confidentiality agreements signed	The procedure does not take place in public hearings
Outcome	An agreement which, under certain conditions, can be enforced directly (titolo esecutivo)	A contract to transfer the shareholding, or a withdrawal agreement	A binding award (lodo) that can be challenged only on limited grounds

How does mediation work, and when is it mandatory?

Civil mediation in Italy is governed by Legislative Decree 28/2010. The mediator does not decide. Their job is to help the parties reach an agreement. Everyone taking part in the procedure is bound by confidentiality, and what is said cannot be used in any later court case, except where the law provides otherwise.

In some matters, mediation is a precondition for going to court. Since the reform that came into force in 2023, the list also includes disputes within partnerships (società di persone). For limited companies (società di capitali), a clause in the articles of association can make mediation mandatory, and the judge can order it in any case during proceedings. By law, mediation lasts six months. The parties can extend it by written agreement, three months at a time.

An important distinction applies here. A management consultant can prepare the discussion, help the shareholders put facts and figures in order and facilitate dialogue. A consultant, however, is not a mediator in the legal sense. Mediation proper only takes place before a registered body. The rules cited here are Italian. For San Marino companies the framework is different and must be assessed case by case.

How do you prepare a negotiated exit?

When the relationship can no longer be mended but the company must be saved, the most common solution is for one of the shareholders to leave. The question is not whether, but how. These are the elements to put on the table, with your own lawyers and accountants:

the value of the shareholding, estimated with an agreed method, ideally by an independent expert chosen jointly
the payment terms, whether a lump sum or instalments, and with what security
a portion of the price linked to future results (an earn-out), if the value still depends on the departing shareholder
the non-compete agreement, which under the Italian Civil Code must be in writing, limited to an area or an activity, and cannot exceed five years
the departing shareholder’s position as personal guarantor of bank loans, which must be released or replaced
the handover of the customers and relationships that the departing shareholder looked after
the communication to employees, customers and banks, agreed between the parties.

Alongside negotiation there is withdrawal (recesso). This is the right to leave the company in the cases provided for by law and by the articles of association, with the shareholding paid out. A well-negotiated exit ends with a contract, not a judgment. It protects both sides from a lawsuit that would block financing and major corporate transactions for years.

When can you go to arbitration?

Arbitration requires the parties’ consent. In companies it is usually given through an arbitration clause in the articles of association (clausola compromissoria), governed by Article 838-bis of the Italian Code of Civil Procedure. These are the key points:

the clause can send to arbitration any dispute between shareholders, or between shareholders and the company, that concerns rights the parties can freely dispose of (diritti disponibili) and relates to the company relationship
on pain of nullity, it must entrust the appointment of all the arbitrators to a person or body outside the company
introducing or removing it requires the vote of shareholders representing at least two thirds of the share capital, and those who disagree can withdraw from the company
it does not apply to companies that raise risk capital on the public market.

If the articles of association do not provide for it, the parties can sign an agreement to refer that specific dispute to arbitration. Costs depend on the value of the dispute and on the number of arbitrators. Ask for them in advance, because they are not always lower than the cost of a court case.

Why is confidentiality part of the solution?

A shareholder dispute that becomes public damages the company even if it is later resolved well. Competitors exploit it, customers notice and banks review their credit lines. If the conflict reaches the press or social media, there is also a reputational crisis to manage in the first few hours.

That is why the discussion should be prepared away from outside eyes, with few people and written rules. This is the work of Blackroom, Strategic’s confidential advisory service for owners and boards. A non-disclosure agreement (NDA) is signed before getting into the substance. We take on a matter only after an assessment. We never act for two opposing parties in the same matter, and we always work alongside the lawyers. An agreement negotiated calmly holds better than one wrung out under pressure.

The right moment to act is not the first formal warning letter. It is when routine meetings stop being routine. Often the dispute grows out of a deadlock between shareholders left to drag on too long, or out of a generational handover left half-finished.

In brief

Before a lawsuit there are three routes. They are mediation, negotiated exit and arbitration.
Mediation takes place before a registered body. In some matters, including disputes within partnerships, it is mandatory.
A negotiated exit requires agreement on value, payment, non-compete terms and security.
Arbitration is possible only with a clause in the articles of association or a written agreement between the parties.
Confidentiality protects the value of the company while the conflict is being resolved.

Frequently asked questions

Is mediation mandatory in a dispute between shareholders?

It depends on the type of company and on its articles of association. In partnerships, the law requires it before going to court. In limited companies, it becomes mandatory if the articles contain a mediation clause, and the judge can order it in any case during proceedings. Your lawyer will check the specific case.

If the articles have no arbitration clause, is arbitration still possible?

Yes, if all the parties involved sign a written agreement that refers that specific dispute to arbitration. Without everyone’s consent, the route remains the ordinary courts.

Can a shareholder leave without the others’ agreement?

In some cases, yes, by exercising the right of withdrawal provided by law or by the articles of association. One example is when the company approves a major change, such as a change to its corporate purpose, that the shareholder did not consent to. A shareholder who withdraws is entitled to have their shareholding paid out under the rules of the Civil Code. Outside these cases, an agreement is needed.

How long does mediation last?

Six months, which the parties can extend by written agreement, three months at a time. An agreement can come sooner, but no one can promise that. It depends on how far apart the positions are and on the parties’ willingness to settle.

When a conflict between shareholders needs to be stopped before it reaches court, the Blackroom page explains how to request a confidential assessment and how the work unfolds, from the first conversation to the decision.

Sources

Consulted on 16 September 2026.

Find out moreBlackroomFor owners and shareholders: shareholder disputes, generational handover, sales of the business and other delicate moments, under a non-disclosure agreement.