At what point is a dividend considered to be declared?

A dividend is generally considered to be declared at the time when the board of directors validly makes the decision to declare it , subject to compliance with the conditions provided for by the applicable law.

This decision may be taken at a meeting of the board of directors or, where the applicable conditions are met, by means of a written resolution of the directors.

The decision declaring the dividend may specify, in particular:

• the amount of the dividend or how it is calculated;
• the class or series of shares entitling the holder to the dividend;
• the date of declaration;
• the reference date used to determine which shareholders are entitled to it, when such a date is set;
• the date or payment terms.

It is important to distinguish between the declaration date and the payment date. The dividend can be declared on a specific date and be payable immediately or on a later date determined by the board of directors.

The fact that payment has not yet been made does not mean that the dividend has not been declared. Once the decision has been validly made, the resulting rights must be determined according to the declaration procedures and applicable rules.

The written resolution or minutes recording the declaration should be kept in the company's minutes book.

In summary , a dividend is generally declared when the board of directors validly decides to declare it. Payment may take place at the same time or at a later date, depending on the established terms.