On 27 July 2022, the Ukrainian Parliament passed the new Law of Ukraine "On Joint Stock Companies". Now the law awaits signing by the President of Ukraine and publishing. After that, it will replace the same-name law of 2008.
The relevant bill was submitted back in 2019 to ensure Ukraine's compliance with its obligations under the Association Agreement with the European Union. The Law aims to improve and further harmonise Ukrainian legislation with the EU company law. The most important novelties are:
- alternative mechanism of convening and holding General Meetings of Shareholders, which enables e-voting via a special hardware and software suite of the Central Securities Depository
- one- or two-tier corporate governance model whereby Board of Directors will be able to simultaneously manage and control activities of the company
- introduction of Corporate Rights Counsel being a legal entity that regularly analyses the regulated and other information about the company with the aim to provide the shareholders with the information, advice and recommendations they may need at voting
- expansion of the range of persons entitled to file a derivative lawsuit (that an owner/member/shareholder files on behalf of a legal entity against its officer to seek from him/her damages caused by such an officer)
- improved and streamlined procedures for mergers, acquisitions, spin-offs and split-ups of joint stock companies
- introduction of a mechanism to maintain records of equity in Limited and Additional Liability Companies in the Central Securities Depository's e-books
The law also amends the Civil Code, the Commercial Code, the Code of Criminal Procedure, the Law of Ukraine "On Limited and Additional Liability Companies”, and other legislative acts. Joint stock companies will be required to bring their activities, including charters and internal regulations, in line with the new law by 31 December 2023.
For further information please contact Asters' Partner Vadym Samoilenko and Counsel Oles Kvyat.
