Annual Corporate Governance Report 2017

34 In the event of conflict, the director involved will abstain from intervening in the deliberation and decision-making process on the transaction generating the conflict. The directors affected by the conflict of interest may not delegate their vote at the relevant Board meeting and must be absent from the meeting room when the Board votes on and discusses the matter. The Annual Corporate Governance Report will disclose all the conflicts of interest in which the Company’s directors are involved. The directors must also notify any actual or potential conflict of interest that they or their related parties (as defined in article 231 of the Spanish Companies Act) may have with the Company. This information must be included in the notes to the financial statements of each year. If a director or any other person affected by the Internal Rule of Conduct (IRC) in the area of Security Markets is involved in a possible conflict of interest, the applicable mechanism is disclosed in such rule. In 2016, Atresmedia approved a new IRC to adapt its content to the new regulations on market abuse. The affected party must inform the Regulatory Compliance Committee as soon as possible, through a computer system installed for this purpose, of any situations that may potentially give rise to conflicts of interest as a result of his/her activities outside the Atresmedia Group, his/her family relationships, his/her personal assets or any other circumstances related with: (a) financial intermediaries operating with the ATRESMEDIA Group; (b) professional or institutional investors that have a significant relationship with the Atresmedia Group; (c) significant equipment or material suppliers; and (d) providers of professional services or external advisers, including those that provide legal, consulting or audit services. As to major shareholders, article 8(2) of the Board Regulations gives the Board the power to approve transactions between the Company and directors, major shareholders or shareholders represented on the Board or their related parties (related-party transactions), except for related- party transactions that meet the requirements set out in section D .1 above. Approval by the Board of a related-party transaction must be endorsed by a favourable report issued by the Audit and Control Committee, which must assess the transaction on the basis of equality of treatment of shareholders and arm’s length terms. In this regard, the Audit and Control Committee prepared an annual report on related-party transactions in 2017. This report was submitted to the ratification and approval of the Board. The annual public disclosures include a summary of the significant transactions concluded by the Company with its directors and major shareholders. D.7 Is more than one Group company listed in Spain? Yes  No X Identify the subsidiaries listed in Spain. Listed subsidiaries Indicate whether they have accurately and publicly disclosed the respective areas of activity they engage in, and any possible business dealings between them, as well as those of the listed subsidiary with other group companies. Yes  No  Define the possible business relations between the Parent and the listed subsidiary, and between the latter and the other Group companies Specify the mechanisms in place to resolve any conflict of interest between the listed subsidiary and other group companies.