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November 15, 2019
Natural and legal entities which are under control of the party interested in transaction will no longer be able to vote for interested party transaction approval
Since 15.11.2019 the changes regarding decision making on interested party transaction approval in Joint-Stock Companies and Limited Liability Companies[i] have become effective. Now it is impossible for entities which are controlled by the parties interested in transaction to vote for the above mentioned transactions approval.
The aim of changes is to stop the persons interested in transaction from influencing the process of decision making. These amendments proceed from the Supreme Court of the Russian Federation regulations: “…the members – legal entities which are not considered as an interested party but are under control of such party (controlled entities) are not entitled to participate in voting for interested party transaction approval” (Clause 23 of the Resolution of the Supreme Court of the Russian Federation plenum No. 27 dated 26.06.2018 “On Challenging of Significant Transactions and Interested Party Transactions”).
Now decision on interested party transaction approval shall be taken by the majority of the votes of Limited Liability Company members total number (shareholders – owners of the voting shares) which are not interested in such transaction or are not controlled by interested party.
[i] Federal Law dated 04.11.2019 No. 356-ФЗ “On Making Changes into the Article 83 of the Federal Law “On Joint-Stock Companies” and Article 45 of the Federal Law “On Limited Liability Companies”.
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