Russian President has signed a law amending Russian corporate legislation, in particular, the federal laws on JSCs and LLCs, the Federal Law on the Securities Market, the Fundamentals of Notarial Legislation. The main amendments are discussed below.
General meetings of shareholders in online formatThe laws on JSCs and LLCs are harmonized with the Civil Code of the Russian Federation, which from 2021 provides for the possibility of remote participation in general meetings of shareholders.
Thus, according to the amendments, voting at the general meeting of shareholders must imperatively be combined with absentee voting in the case of public joint stock companies, as well as non-public JSCs with more than 50 voting shareholders. Other non-public joint stock companies may also provide for combining voting at a meeting of the general meeting of shareholders with absentee voting in their charters.
The special laws have been amended with regard to the procedure for sending information, documents and ballots for meetings, making proposals to the agenda, preparing for and participating in the meeting, the procedure for making decisions and drawing up minutes of meetings.
Identification of persons entitled to participate in the online meeting may be carried out in one of the following ways:
- through an enhanced qualified electronic signature;
- by non-qualified signature on the portal “Gosuslugi” or from a corporate agreement on electronic interaction;
- by simple electronic signature if data from the Unified Identification and Authentication System and the Unified Biometric System are used.
The latter two options must be provided for in the company's charter or in its internal documents.
Articles of association of non-public JSCs may include other ways of “reliably identifying persons participating remotely in the meeting and methods of signing ballots”, provided that these methods do not limit the rights of shareholders to participate in decision-making.
Online meetings must be accompanied by real-time image and sound broadcasting. A record of such broadcast should be kept together with the minutes of the meeting. If there are significant technical failures, the meeting will be recognized as invalid.
Amendments to the Laws on JSCs and LLCs regarding remote general meetings of shareholders will come into force on March 1, 2025. However, since similar provisions in the Civil Code of Russia have been in force for several years, remote meetings are still actively used.
Suspension of dividend payments to “lost” shareholdersThe law also solves the problem of so-called “lost” shareholders, i.e., persons included in the register of shareholders but not participating in the company's activities and not exercising their rights to receive dividends for a long time. The presence of such “dead souls”, first of all, hinders normal economic activity of a JSC, first of all, the adoption of decisions requiring unanimity (for example, on liquidation of the company). Besides, the company spends considerable funds for sending dividends, notices of JSC general meetings of shareholders and other correspondence, which are subsequently returned to the company.
The payment of dividends to “lost” shareholders and the sending of information to them may be suspended by resolution of the company's board of directors if the following conditions are simultaneously met:
- Non-receipt by shareholders of dividends and correspondence within the last two years and their return to the company;
- Failure of shareholders to receive voting ballots for at least two general meetings or failure to receive dividends at least twice;
- Failure by shareholders to provide the registrar with up-to-date information about themselves.
When information about a shareholder in the register is updated, the payment of dividends to that shareholder is resumed.
The provisions on “lost” shareholders are mandatory for PJSCs, while the charter of a non-public JSC may provide for the non-application of these provisions.
These provisions entered into force on August 8, 2024.
Notarization of resolutions on appointment of directorsThe amendments also provide that from September 1, 2024, the fact that a decision to elect the sole executive body (CEO) of a company must be notarized.
This will enable the notary to verify the competence of the company's governing body making the decision, establish the identity of the meeting participants and verify that their representatives have authority, and ensure compliance with quorum rules and the correct counting of votes. no later than the next business day after the meeting, the notary sends an electronic application to the Federal Tax Service to make the relevant changes to the Unified State Register of Legal Entities.
This innovation is aimed at combating the illegal change of CEOs by forging minutes of general meetings and “appointing” false persons as general directors. The entry of such a fake director in the Unified State Register of Legal Entities is fraught with the shareholders’ loss of control over the company, withdrawal of assets from the company and bringing it to bankruptcy. Imperative notarization of decisions and minutes on the change of directors will significantly reduce the risks of such an unfavourable development of events.
Source: Federal Law No. 287-FZ from August 8, 2024 “On Amendments to the Federal Law ‘On Joint-Stock Companies’ and Certain Legislative Acts of the Russian Federation”.