New Procedure for Change of Authorized Capital of JSC
On 18 June 2013 two resolutions issued by the National Securities and Stock Market Commission (the "Commission") on 14 May 2013 entered into force, namely Resolution No. 822 approving the Procedure for the Increase (Reduction) of Authorized Capital of Private or Public Joint-Stock Company ("Resolution 822") and Resolution No. 823 ("Resolution 823") approving a number of changes to the Procedure for the Registration of Share Issues Made in the Course of Change of the Amount of the Authorized Capital of Joint Stock Company (the "Procedure").
Resolution 822 applies to public ("PuJSC") and private joint stock companies ("PrJSC") (except for joint investment institutions) carrying out the increase or decrease of their authorized capital (the "Capital") and does not cover the changes in the Capital due to the JSC reorganization.
Resolution 822, inter alia:
It is worth mentioning that Resolution 822 now establishes the requirement to prepare a share issue prospectus even in case of a private placement of shares, whereas the previous procedure required such a prospectus only from the JSC carrying out a public offering of shares.
Also, Resolution 822 introduces a legal ground for the definition of market value of the issued shares, which shall be calculated as of the day preceding the first day of sending the shareholders a written notice on holding the GMS if the agenda of such GMS includes the item on the Capital increase. It should be noted, however, that the above calculation mechanism is available only for the JSC, which shall and does not make a publication of the GMS convocation notice.
Resolution 823 introduces a number of changes to the list of documents necessary for the registration by the Commission of a share issue made in course of the Capital change, establishes requirements applicable to such documents.
Inter alia, to register a share issue and share issue prospectus in course of the Capital increase made through a private placement of shares, the Procedure no longer requires JSC to file with the Commission the following documents:
From now on, the specified documents must be submitted to the Commission at the stage of the registration of the report on results of private placement.
In addition, the Commission doubled the statutory term for filing the documents necessary for the registration of the report on the results of private placement. Now, it amounts to 30 calendar days from the date of the introduction of relevant amendments to the JSC's charter.
Other Regulatory Changes for the Securities Market
Also, a number of other resolutions of the Commission became effective in June 2013, namely (i) Resolution "On Approval of Procedure for Cancellation of Share Issues" No. 737 of 14 April 2013, and (ii) Resolution "On Approval of Procedure for Issue and Registration of Shares of Joint Stock Companies Being Established Through Merger, Demerger, Spin-off, or Transformation or Being Consolidated" No. 520 of 9 April 2013.
© Asters 2013