The Charter of the LLC and the shareholder's right to information

The Law "On Business Associations" is the main normative legal act that determines the procedure for the establishment and operation of business entities in the Russian Federation, lays the foundation for the regulatory framework that determines the shareholders' position, sets the principles and standards for their behavior, and fixes the rights of shareholders and guarantees their implementation. The analysis of this legal act shows that, unfortunately, it contains gaps and "weak" places, as a result of which it is not able to fully guarantee the protection of the rights of the participants of the JSC. Despite the undoubted merits of this document, he did not solve the problem of creating an effective mechanism for protecting the rights of business entities.

In recent years, scientists and practitioners have been actively discussing the functioning and activities of the JSC.

The legal personality of various types of business entities is characterized by the fact that their participants are endowed with both mandatory rights and corporate rights, including the right to get acquainted with the content of established constituent documents, the main of which are the Charter of the LLC, the charter of the GCN, the charter of the MUP.

The shareholder's right to such information, which has been enshrined in the Law on Business Associations, is "key" in the shareholders' rights system , as it serves as a guarantee for the protection and realization of other rights granted to the shareholders. This right also stipulates the Charter of the LLC. Full and truthful information enables shareholders to draw conclusions about the effectiveness of the company and its management, and may significantly affect the adoption by the shareholders of certain important decisions, for example, the presentation to the company of demands for the repurchase of shares owned by shareholders, on making proposals, on presenting extraordinary meeting requirements and others. Lack of informing shareholders could lead to a breach of the principle of equality in relation to the various actors of the company , and against orechit that provides Charter LLC.

There is a need to dwell on this document and how to approach its design. The Charter is the main constituent document, without which it is impossible to register the company and its opening. From its content, quality of development depends the legal position of the LLC itself, as well as the regulation of interactions and relationships between the participants.

According to the law, the Charter is approved at the time of the establishment of the LLC and is then registered with the relevant executive authority. There is no statutory model of the Charter, there are only recommended templates. However, various legal acts contain indications as to which provisions should necessarily be reflected in the Charter. Summarizing these disparate data, it is possible to present a generalized list of information that is mandatory for reflection in the Charter. This document should contain:

- data on the founders of the LLC;

- The size of the statutory fund;

- detailed data on the shares of each member of the LLC in the statutory fund;

- conditions for making contributions to the statutory fund;

- options and measure of liability of LLC members for non-compliance with the provisions of the Charter;

- comprehensive information on the management of the company and the governing body;

- procedure and legal procedure for making decisions for each type of issue, depending on the degree of its importance;

- Information on the body responsible for the reorganization of the company and the procedure for the reorganization (liquidation) itself;

- the procedure and procedure for the admission of new members, the procedure for the withdrawal or exclusion of participants from the LLC;

- The algorithm for buying and selling the shares of the statutory fund to third parties;

- the procedure for providing information to the participants of the company on its activities.

To date, the legally enforceable right to information is largely declarative, as the legislation does not contain a real mechanism for its implementation. The fact that shareholders have the right to receive information can only be said if the conditions and procedure for its implementation are clearly fixed in the legislation, as well as by providing it with the compulsory force of the state. However, given that the statutes of many joint-stock companies, as a rule, do not regulate the volume and procedure for providing information, or set it not clearly enough, the relevant governing bodies of the company are free to refuse to provide shareholders with the required information.

It should be noted that the Law on Business Associations has a norm obliging them to specify in the charters the procedure for providing such information to the participants and the volume of its provision. But referring the decision of this issue to the management of joint-stock companies means actually giving the possibility of abuse by large shareholders and top management of companies.

The mechanism for the realization of the right to information should be enshrined directly in the law, and not only in the charter of the society. Each shareholder, regardless of the size of the shareholder package, must know in advance which of the documents regulated by law he has free access.

It is advisable that in the Law on Business Companies the right to receive information should correspond to the obligation of the company to provide the shareholder, upon his request, with the documents specified by the legislation for storage by the company, and general requirements to the procedure for providing information should be regulated. The Charter of the LLC must be developed in such a way that it contains an exhaustive list of these documents, as well as stipulates the procedure for providing them to the shareholder for information.