The board of directors is in charge of determining the strategy and the (external) representation of the company. In this capacity, the board and the individual directors are authorized to bind the company. To what extent they are collectively or individually authorized to do so is often specified in the articles of association. Therefore, it is recommended to verify, prior to a transaction, whether a particular member is actually authorized to bind the company.
If a member of the board of directors has a conflict of interest with respect to a certain transaction, he or she is not allowed to participate in the decision-making process. In case the entire board of directors has a conflict of interest, the decision has to be taken by the general meeting, or, if existing, by the supervisory board or the non-executive directors, unless otherwise stipulated in the articles of association.