A number of substantial amendments were introduced to Russian corporate legislation in 2009, such as the recognition of shareholders' agreements and the introduction of debt to equity swaps. These legislative developments aimed to:

Some legislative developments affect only JSCs or LLCs, as noted below.

The following is a brief overview of the major corporate law developments in 2009. (Please note that this Overview does not cover anti-monopoly legislation developments in 2009.)

Some legislative changes concerned LLC foundation documents. The charter is now the only foundation document of a Russian LLC. However, a foundation agreement still has to be concluded when an LLC is established by more than one person. The information on the amount and nominal value of the participatory interest of each participant must be reflected in the Unified State Register of Legal Entities maintained by the tax authorities (State Register) but does not have to be in the LLC charter.

A number of changes were introduced to simplify the LLC regulations by Federal Law No. 312-FZ of 30 December 2008 (in force as of 1 July 2009). For example, it is no longer necessary to include in the LLC charter the terms and procedures for participants to make contributions to the LLC charter capital, and the participants' right to withdraw from the LLC is now limited. All LLCs established before 1 July 2009 have to bring their charters into compliance with the relevant federal law once they are amended for any other reason.

LLCs were required to maintain a list of all participants and ensure that the information in the list conforms to the data of the State Register. If there are inconsistencies, the information in the State Register prevails.

The JSC and the registrar are jointly and severally liable for losses caused to a shareholder as a result of a loss of shares or the impossibility to exercise rights provided by shares due to the improper maintenance of the shareholders' register. This is a welcome change for JSCs, which were previously solely liable for such losses.

The concept of a "shareholders' agreement" (an SHA) was introduced for the first time in the LLC Law and the JSC Law.

An SHA may regulate voting procedures, co-ordination of voting between shareholders/participants, acquisition or sale of shares at an agreed price and/or on the occurrence of certain events, restrictions on selling shares, and the coordination of other actions related to the governance, operation, reorganisation and liquidation of the company subject of the SHA.

The JSC Law establishes more detailed regulations on SHAs than the LLC Law. Unlike the LLC Law, it provides that:

The JSC Law also sets out disclosure requirements for executed SHAs.

Substantial amendments were introduced to the LLC Law provisions on major and interested party transactions. Most of the amendments reflected similar provisions in the JSC Law. In particular, the amendments:

At the same time, there were a number of legislative developments with respect to challenging major and interested party transactions of JSCs and LLCs. Namely, the invalidation of a decision of the general shareholders'/participants' meeting or the board of directors approving a transaction does not invalidate the respective transaction in itself. The amendments also listed cases when a court would reject a claim to invalidate a major or interested party transaction concluded in breach of legal requirements (for example, the subsequent approval of a transaction, absence of evidence of damages caused or to be caused to the company or shareholders/participants).

The disclosure requirements related to the reorganisation of JSCs and LLCs were broadened. A company no longer has to individually notify its creditors in writing of its reorganisation. It is sufficient to inform the registration authorities of the initiation of the reorganisation (so that a record is made in the State Register) and publish a notification in the State Bulletin.

The creditors, whose claims arose before the publication of a notification on the reorganisation, are entitled to claim early fulfilment of the company's obligations or, if early fulfilment is impossible, claim for termination of the obligations and compensation of the losses (save for certain exceptions set out by law). This would not result in a suspension of the company's reorganisation. The creditors may exercise such rights within 30 days of the date of the last publication of the notification on the company's reorganisation. Special regulations were established for credit organisations.

There were a number of amendments to the regulations on bankruptcy of Russian companies in 2009. In particular, two types of transactions by a debtor may now be challenged in court – namely, suspicious transactions and transactions entailing preferential treatment of certain creditors. The amendments also introduced the concept of a debtor's controlling persons, which bear joint and several subsidiary liability for the debtor's debts.

Suspicious transactions by a debtor would include both:

The regulations for credit organisations are almost the same.

The legislative amendments introduced in the Administrative Code are new types of administrative offences related to the violation of statutory requirements with respect to the procedure for calling, preparing and holding general meetings of shareholders of JSCs, participants of LLCs and stockholders of closed joint stock investment funds. In particular, such administrative offences include unlawful refusal to call a meeting, violation of a meeting's term and notification procedure, violation of quorum requirements and the procedure for documenting a meeting. The list of persons that may be subject to administrative liability was extended and now includes members of the board of directors, the liquidation committee, the audit commission and the counting board (members of which are not generally considered company officers), save for those members who voted against the infringing resolutions.

The legislative amendments introduced a new category of corporate disputes which are subject to the special jurisdiction of the commercial courts. Corporate disputes include disputes with respect to the foundation, reorganisation and liquidation of a company, disputes on convocation of the general shareholders'/participants' meeting and the challenging of decisions of the management bodies.

The claims must now be filed with a commercial court at the location of the legal entity with respect to which the dispute arose. The commercial court considering the corporate dispute must post information on the dispute on its website, notify the legal entity with respect to which the dispute arose and provide it with copies of judicial acts. The court may also require the legal entity to notify its shareholders, members of the management bodies, and the registrar and/or depositary of the initiation of the proceedings.

Russian companies are subject to state control by various state authorities. The General Prosecutor's Office now publishes plans of annual scheduled inspections of companies on its website by 31 December of each calendar year.

For more detailed information on the above legislation developments, see the Special Features on the Russian Federation contents page located on the PLC Global Finance home page or go to .