The new Law of Ukraine “On limited liability and additional liability companies” No. 2275-VIII, which entered into force on 17 June 2018, more than once will cause discussion. In separate provisions of the companies already found a lot of positive that will contribute to the prosperity of the economy and building businesses with the best corporate practices.
“A very long time corporate law of Ukraine did not cause much interest and righteous criticism, as the new Law of Ukraine on LLC. While this is only the first stage of corporate reforms, the responsibility for the correct application of the law rests entirely on us,” stated Anna Babych, partner at Aequo, took an active part in the drafting of this law and is one of its authors.
– It should be noted two important provisions of the new law is the order of conversion of debt into capital and the issue of collateral shares. With the new law, the pledge of the LLC shares received the right to a second chance. Now, the minority members will not be able to prevent the mortgagee to foreclose on the share, as the pledgee may apply to the usr without the consent of other members to changes in the LLC Charter. At the same time, the law rightly gives the shareholders pre-emptive right to purchase a share of a mortgagor. Practically there are expectations that the Deposit shares will be a really used tool for business financing – said Anna Babych.
– More recently, was not allowed, according to part 2 of article 144 of the Civil code of Ukraine, the release of the participant from the obligation to make a contribution to the share capital of the company, including by way of setoff. But on June 17 of article 140 – 151 of the Civil code, is possible that automatically cancels the limit that should please foreign investors.