Not necessarily. The right to receive a dividend depends on the rights attached to the shares held by each shareholder.
A company may have several classes or series of shares carrying different rights. The articles of association may, in particular, provide for specific rights regarding voting, dividends, or the distribution of assets upon the company's liquidation.
When a dividend is declared, the board of directors must therefore determine the classes or series of shares that are entitled to it and respect the rights provided for in the articles of association.
Thus, a dividend can be declared for the benefit of one class of shares without necessarily being declared for the benefit of other classes, when the rights attached to the shares allow it. Certain classes of shares may, in particular, have a priority right to receive a dividend compared to other classes of shares.
However, directors cannot simply choose certain shareholders within the same class and exclude others when their shares carry the same rights. The dividend must be distributed in accordance with the rights attached to the shares in question and the terms of its declaration. A shareholder entitled to a declared dividend may, however, depending on the circumstances, waive their right to receive it in writing.
Before declaring a dividend, it is therefore important to check:
In summary , a dividend does not necessarily have to be paid to all shareholders. However, it must be declared and allocated in accordance with the rights attached to the relevant classes or series of shares.