(Unofficial translation)

 

Law of the Republic of Belarus

No 2020-XII of December 9, 1992

[Amended as of July 15, 2015]

On economic companies

TABLE OF CONTENTS

CHAPTER 1. GENERAL PROVISIONS (Articles 1 – 9)

CHAPTER 2. FORMING, REORGANIZATION AND LIQUIDATION OF THE ECONOMIC COMPANY (Articles 10 – 27)

CHAPTER 3. STATUTORY FUND AND OTHER FUNDS, PROPERTY AND SECURITIES OF THE ECONOMIC COMPANY (Articles 28 – 32)

CHAPTER 4. BODIES OF THE ECONOMIC COMPANY AND MANAGEMENT IN THE ECONOMIC COMPANY (Articles 33 – 55)

CHAPTER 5. AFFILIATED PERSONS AND TRANSACTIONS OF THE ECONOMIC COMPANY (Articles 56 – 58)

CHAPTER 6. CONTROL OVER FINANCIAL AND ECONOMIC ACTIVITIES OF THE ECONOMIC COMPANY (Articles 59 – 61)

CHAPTER 7. RECORD-KEEPING AND ACCOUNTING, DOCUMENTS OF THE ECONOMIC COMPANY. INFORMATION ON THE ECONOMIC COMPANY (Articles 62 – 64)

CHAPTER 8. JOINT-STOCK COMPANY (Articles 65 – 901)

CHAPTER 9. LIMITED LIABILITY COMPANY (Articles 91 – 1111)

CHAPTER 10. ADDITIONAL LIABILITY COMPANY (Articles 112 – 113)

 

This Law is aimed at determining legal status, procedure of forming, activity, reorganization, liquidation of economic companies, the rights and duties of founders (participants) of economic companies, the competence of bodies of economic companies, and also at ensuring protection of the rights and interests of founders (participants) of economic companies and economic companies themselves.

CHAPTER 1
GENERAL PROVISIONS

Article 1. Basic provisions on the economic company

The economic company is recognized a commercial organization the statutory fund of which is divided in stakes (shares) of its participants.

The economic company:

has in ownership separate property created at the expense of contributions of founders (participants), and also made or acquired by the economic company in the course of its activity;

bears the independent responsibility on its obligations, may acquire and implement the property rights and personal non-property rights, fulfil the duties, act as plaintiff and respondent in the court.

can have civil rights corresponding to the purposes of activity provided in the constituent documents of the economic company, and to the subject of activity if it is specified in the statute, and bear duties related to that activity. Some kinds of activity the list of which is determined by the legislative acts may be carried out by the economic company only subject to a special permission (license);

acquires civil rights and accepts civil duties through its bodies acting in accordance with the legislation and the statute;

may establish legal persons and make part of legal persons, in accordance with the legislation;

may establish associations of legal persons, not being legal persons, and participate in such associations, in accordance with the legislation.

In the cases provided by the legislative acts, the economic company may acquire civil rights and accept civil duties through the participants thereof.

The legal capacity of the economic company arises at the moment of its creation and ceases at the moment of completion of its liquidation.

Article 2. Legislation of the Republic of Belarus on economic companies

The legislation of the Republic of Belarus on economic companies is based on the Constitution of the Republic of Belarus and consists of the Civil Code of the Republic of Belarus, this Law and other acts of legislation.

Article 3. Scope of application of this Law

This Law is applied to the economic companies being created in the territory of the Republic of Belarus, unless otherwise established by this Article and other legislative acts.

Provisions of this Law regulating legal status, order of creation, activity, reorganization and liquidation of economic companies cover economic companies consisting of one participant, unless otherwise established by this Law and other legislative acts.

Specific features of legal status, creation, reorganization and liquidation of economic companies in banking, insurance, exchange and other lines of activities are determined by other legislative acts.

Specific features of legal status and creation of economic companies one hundred percent of statutory funds (shares) of which are in the ownership of the Republic of Belarus and/or its administrative and territorial units are determined by the legislative acts.

Specific features of creation of open joint-stock companies during privatization of the state-owned property are determined by the legislation on privatization.

Specific features of legal status of joint-stock companies created in the process of privatization of state property or by means of transformation of leaseholding and collective (people's), state, state unitary enterprises, of management of such companies, issue and circulation of shares of such companies may be established by the legislation on privatization.

Specific features of change of statutory funds of economic companies, and also of transfer of stakes (shares) by the participants of economic companies to the ownership of the Republic of Belarus and/or administrative and territorial units of the Republic of Belarus or appropriate state banks at restructuring the indebtedness of economic companies on payments in the state and/or local budgets and on the credits granted by the state banks, the procedure of determination of value of such stakes (shares) and of making the decisions, by the supreme governing body of the economic company, on the application for re-structuring of such indebtedness, are determined in accordance with the legislation subject to the procedure established by the President of the Republic of Belarus.

Specific features of activity of economic companies during the protection period, periods of pre-judicial reorganization and bankruptcy proceedings are determined by the legislation on economic insolvency (bankruptcy).

Specific features of issue and circulation of securities of an economic company, unless otherwise established by the legislation on securities, are determined by this Law and antimonopoly legislation.

Article 4. Name and place of location of the economic company

The economic company has the name in Belarusian and in Russian, containing the indication of organizational and legal form of the company.

The name of the economic company must be agreed in accordance with the procedure established by the legislation, before submitting the documents for the state registration of the economic company in the registering body.

The place of location of the economic company is determined by the place of location of its permanent executive body, and in the event of absence of a permanent executive body – of another body of person, having the right to act on behalf of the economic company without power of attorney.

Article 5. Liability of the economic company

The economic company is liable for the obligations thereof with all the property of the company.

Participants of the economic company are not liable for obligations of the economic company, and the economic company is not liable for obligations of participants, except for the cases provided by the legislative acts or the statute.

If economic insolvency (bankruptcy) of the economic company is caused by the participants of that company or by other persons, including the person exercising powers of the one-man executive body of the economic company or heading the collective executive body of that company, having the right to give the instructions mandatory for that company, or the opportunity to determine the activity of the company by any other way, then, in case of insufficiency of property of the economic company, the subsidiary liability is charged on such persons for the obligations of the company in accordance with the legislative acts.

The economic company is not liable for obligations of the Republic of Belarus or administrative and territorial units of the Republic of Belarus, unless otherwise established by the legislative acts.

Article 6. Representative offices and affiliates of the economic company

The economic company can, in accordance with the procedure provided by this Law and other legislation, establish the representative offices and affiliates which are not being the legal persons and act on behalf of that company on the basis of the provisions stipulated by the economic company which has established the representative office or affiliate.

The representative office of the economic company is a separate division of the economic company, located outside the location of the economic company, carrying out representation and protection of interests of the economic company, making the transactions and other legal operations on behalf of the economic company.

The affiliate of the economic company is a separate division of the economic company, located outside the location of the economic company, carrying out all or part of functions of the economic company, including functions of representation.

Representative offices and affiliates of the economic company are provided with property of the economic company which has established those representative offices and affiliates, which is accounted separately on the balance sheet of the company (separately in the inventory book of incomes and expenses of organizations and individual entrepreneurs, applying the simplified taxation system (hereinafter – inventory book of incomes and expenses)).

The head of representative office or affiliate of the economic company is appointed by the economic company and acts on the basis of the power of attorney which is issued by the company in accordance with the procedure established by the legislation.

Creation of representative offices and affiliates of the economic company outside the territory of the Republic of Belarus is carried out in accordance with the legislation of the foreign state, where the representative offices and affiliates are located, unless otherwise provided by the treaties of the Republic of Belarus.

The economic company which has established the representative offices and affiliates is liable for activity thereof.

Article 7. Affiliated economic company

The economic company is considered as the affiliated economic company, if another (principal) economic company or partnership, by virtue of prevailing sharing in the statutory fund, and/or in accordance with the agreement concluded between then, and/or by any other way, has an opportunity to determine the decisions made by such company.

The affiliated economic company is not liable on debts of the basic economic company or partnership.

The basic economic company or partnership, which has the right to give mandatory instructions for the affiliated economic company (including the cases when such instructions can be given in accordance with the agreement concluded with such company), is liable jointly and severally with the affiliated economic company for the transactions concluded by the latter in pursuance of those instructions.

In case of economic insolvency (bankruptcy) of affiliated economic company through the fault of the basic economic company or partnership, the subsidiary liability on the obligations of the affiliated economic company is charged to that company or partnership, in case of insufficiency of property of affiliated economic company.

Participants of affiliated economic company have the right to claim for the reimbursement, by the basic economic company, of the losses caused for the affiliated economic company through the fault of the basic economic company.

Article 8. Dependent economic company

The economic company is considered as dependent if other economic company has a stake in the statutory fund (shares) of that company, equal to twenty or more per cent of votes from the total number of votes which it can use on the general meeting of participants of such company.

The dependent economic company is not entitled to have and to acquire a stake in the statutory fund (shares) of the economic company, in relation to which it is considered as dependent in accordance with part one of this Article.

Article 9. Unitary enterprise of the economic company

The economic company can be the founder of the unitary enterprise which operates on the basis of the statute, approved by that economic company.

The property of the unitary enterprise, founded by the economic company, is in the property of the economic company which is the founder of that unitary enterprise, and belongs to the unitary enterprise on the right of economic management.

The head of the unitary enterprise, founded by the economic company, is appointed by the economic company. The economic company has the right to establish the procedure of appointing the heads of the unitary enterprises, founded by that company, in the statute thereof.

The unitary enterprise, founded by the economic company, is liable for the own obligations thereof with all the property belonging to that enterprise.

The unitary enterprise, founded by the economic company, is not liable for the obligations of that economic company, with the exception of cases stipulated by the Civil Code of the Republic of Belarus.

The economic company, which is the founder of the unitary enterprise, is not liable for the obligations of the unitary enterprise, except for the case specified in part seven of this Article.

If the economic insolvency (bankruptcy) of the unitary enterprise, founded by the economic company, is caused by that company, the subsidiary liability for the obligations of that unitary enterprise is charged to the economic company, in case of insufficiency of property of the unitary enterprise.

The legal status of the unitary enterprise, founded by the economic company, is determined by the legislation on the unitary enterprises.

CHAPTER 2
CREATION, REORGANIZATION AND LIQUIDATION OF THE ECONOMIC COMPANY

Article 10. Creation of the economic company

The economic company is created in accordance with this Law and other legislative acts by the way of founding or reorganization of legal persons.

The economic company may be created as joint-stock company (in the form of an open or closed one), limited liability company or additional liability company.

The economic company may be founded by one persons or may consist of one participant, including when being created as a result of reorganization of a legal person.

The economic company is considered as formed from the date of state registration thereof in accordance with the procedure determined by the legislative acts.

The economic company is considered as formed for unlimited term, unless otherwise stipulated in the statute thereof.

Article 11. Founding of the economic company

The founding of the economic company is carried out on the decision of its founders, which shall be adopted prior to the constituent meeting. The decision on  founding of the economic company may be adopted by the founders through conclusion of a contract on creating the economic company or in another form determined by the founders, unless otherwise established by part three of this Article, and also with the exception of the case provided by part one of Article 67 of this Law.

The decision on founding of the economic company shall determine:

the procedure of joint activities of founders on creation of the economic company, rights and duties thereof in relation to creation the economic company, including the procedure of developing the draft statute of the economic company;

distribution between the founders of duties on preparation for the state registration of the economic company, including on obtaining the approval, in accordance with existing procedure, of the name of the economic company, opening the temporary account for formation of the statutory fund of the economic company in the instance if, according to the decision on founding the economic company, its statutory fund must be formed prior to its state registration, on performance of other actions established by the legislation;

the size of the statutory fund, the procedure of making the contributions to the statutory fund by the founders;

a legal person or an individual entrepreneur, which will carry out the assessment of the value of the non-monetary contribution to the statutory fund of the economic company or perform an expert examination of the assessment of the value of the non-monetary contribution to the statutory fund of the economic company in the instance if, according to the decision on founding the economic company, its statutory fund must be formed prior to its state registration;

the founder of the economic company to be authorized to sign the application for the state registration, in the event when the number of founders of the economic company is more than three and they took the decision to authorize one of them to sign the said application;

procedure for calling and holding the constituent meeting of the economic company.

In the instance of founding of the economic company by one person, the decision(s) on issues related to its founding is (are) to be taken by that person individually and formalized in writing. The decision(s) of a sole founder related to founding of the economic company must determine the amount of the statutory fund of the economic company and the order of its formation, a legal person or an individual entrepreneur, which will carry out the assessment of the value of the non-monetary contribution to the statutory fund of the economic company or perform an expert examination of the assessment of the value of the non-monetary contribution to the statutory fund of the economic company in the instance if, according to the decision on founding the economic company, its statutory fund must be formed prior to its state registration; and also contain decisions on issues specified in part one of Article 12 and part one of Article 68 of this Law.

Founders of the economic company are liable jointly and severally for the obligations concerning the founding of the economic company, which have arisen before the state registration of the company. The economic company accepts the liability for the obligations of founders, concerning the founding of the economic company, subject to the subsequent approval of the activities of founders by the general meeting of participants of the economic company. In the instance of founding of the economic company by one person, the liabilities on obligations which have arisen prior to the state registration of that economic company and related to its founding is borne by that person. In that instance the economic company may accept the liability on obligations of the founder related to the founding of that company.

Article 12. Constituent meeting of the economic company

On the constituent meeting of the economic company, the founders shall:

approve the assessment of the value of non-monetary contributions to the statutory fund of the economic company in the instance if, according to the decision on founding the economic company, its statutory fund must be formed prior to its state registration;

approve the statute of the economic company;

form the bodies of the economic company and elect the members thereof;

resolve other questions stipulated by this Law.

The constituent meeting of the economic company is held in the in-person form that envisages joint assistance of the founder of the economic company at discussion of the agenda of the constituent meeting and at taking decision on them.

Decisions on the constituent meeting of the economic company concerning the matters specified in part one of this Article, must be adopted by the founders unanimously, with the exception of the case established by part three of Article 68 of this Law.

Each founder participates in the constituent meeting of the economic company with a right to vote.

The number of votes of each founder is determined proportionally to the value of the contribution thereof, which is subject to contribution to the statutory fund. The contract on creating the economic company of another document confirming the intention to form the economic company may establish another number of votes belonging to each founder at the constituent meeting, with the exception of the case stipulated by part 4 of Article 68 of this Law.

The decisions of the constituent meeting of the economic company are registered in the report of proceedings which is subject to signing by all founders of the economic company.

In the instance of founding of the economic company by one person the constituent meeting is not held.

Article 13. Founders of the economic company

Founders of the economic company are the citizens (natural persons) and/or the legal persons who have made a decision on founding thereof.

After the state registration of the economic company, the founders of the economic company become the participants thereof.

The participants of the economic company are also the persons who have obtained the ownership, right of economic management or operative administration to a stake in the statutory fund (shares) of the economic company having regard to specific features provided by part five of Article 101 of this Law.

State bodies, bodies of local government and self-government have no right to act as participants of the economic companies, unless otherwise stipulated by the legislation.

The unitary enterprises, state associations, and establishments sponsored by the proprietors, can be the participants of economic companies, subject to permission of the proprietor (or the body authorized by the proprietor), unless otherwise stipulated by the legislative acts.

The economic company may not have as a sole participant another economic company consisting of one participant.

Participation of specific categories of citizens (natural persons) in the economic companies may be forbidden or limited by the law; participation of legal persons can be limited only in cases and in accordance with the procedure stipulated by the legislative acts.

The participants of the economic companies have the rights of obligations concerning those companies, and can have real rights only on the property transferred by those participants to the economic companies for using as contributions in the statutory funds.

The participants of the economic company are entitled:

to participate in management of activities of the economic company with regard to features stipulated by part 3 and 4 of Article 71 of this Law;

to receive information on activities of the economic company and have knowledge of its documents in the scope and under the procedure established by the statute;

to participate in distribution of profits of the economic company;

to obtain, in case of liquidation of the economic company, part of the property remained after settlements with creditors, or the cost of such property.

The participants of the economic company may also have other rights provided by this Law, other legislation and the statute of the economic company.

The participants of the economic company may transfer powers to participate in the management of activities of the economic company to other persons through issuance of the power of attorney or conclusion of the contract under the procedure established by the legislative acts.

The right to participate in management of activities of the economic company may belong to other persons which acquired rights of enjoyment and/or disposal of stakes (part of a stake) in the statutory fund (shares) of the economic company on the basis of an contract, unless otherwise established by the legislative acts, and also to the persons authorized, in accordance with the legislative acts, to administer the inherited property in the event of the death of a participant of the economic company.

Participants of the economic company are obliged to:

make contributions to the statutory fund of the economic company in the order, amounts and within the time limits provided by this Law, other legislative acts and the statute;

never disclose a confidential information on the activity of the economic company, obtained in connection with participation in the economic company;

perform other duties connected with participation in the economic company, provided by this Law, other legislative acts and the statute of the economic company, and also by a shareholders’ agreement (contract on exercising right of the participant of the additional liability company) in the instance when the participant is a party to such an agreement (contract).

Article 14. Constituent document of the economic company

The constituent document of the economic company is the statute of the economic company approved by its founders (participants).

The statute of the economic company must determine:

name of the economic company;

location of the economic company;

purposes of activity and, in the cases specified by the legislation, the subject of activity;

size of the statutory fund;

rights and duties of participants;

structure, order of election or formation, staff and competence of the bodies of the economic company;

procedure of management of activity of the economic company;

governing body or a person (worker) of the economic company authorized to prepare, to call and to hold a general meetings of its participants in the instance established by part four of Article 50 of this Article (hereinafter – authorized body of the economic company);

procedure of making the decisions by the governing bodies, including the list of matters, for decisions on which the unanimous voting or qualified majority (not less than two thirds, three quarters) of votes  is necessary;

conditions and order of distribution of profit and losses;

list of representative offices and affiliates;

liability of the company and participants thereof;

order of approval of the accounting (financial) statements of the economic company (data of the inventory book of incomes and expenses), of the economic company, its representative offices and affiliates;

order and scope of providing information on the economic company to the participants;

other information stipulated by this Law and other legislation.

In the statute of the economic company, subject to the consent of founders (participants), other provisions, not contradicting the legislation, may also be included.

Changes and additions in the statute of the economic company are made in cases and in accordance with the procedure established by this Law and other legislative acts.

Changes and/or additions made in the statute of the economic company, are subject to the state registration in accordance with the procedure established by the legislative acts, and come in force for third parties since the date of such registration, unless otherwise established by the legislative acts.

Article 15. Reorganization of the economic company

The reorganization of the economic company may be carried out according to a decision of the general meeting of participants of that company, taken in accordance with this Law and other legislative acts, and also in the instances and under the procedure established by the legislative acts – according to a decision of authorized state bodies, including the court. Reorganization of the economic company can be carried out in the form of merging, affiliation, splitting-up, splitting-off, transformation.

Reorganization of the economic company, as a result of which the legal persons of other organizational and legal forms are found, is carried out in accordance with the procedure established by this Law, taking into consideration the features provided by other legislative acts.

The economic company is considered reorganized (with the exception of cases of reorganization in the form of affiliation) since the date of the state registration of newly founded economic companies or legal persons of other organizational and legal forms in accordance with the procedure determined by the legislative acts.

In case of reorganization of the economic company in the form of affiliation of other legal person with that company, the former is considered reorganized since the date of making the record in the Unified State Register of Legal Entities and Individual Entrepreneurs on the termination of activities of the affiliated legal person.

In the cases established by the legislative acts, reorganization of the economic company can be carried out only subject to the consent of the competent state bodies.

Article 16. Merging of economic companies or of economic companies and legal persons of other organizational and legal forms

Merging of the economic companies or of the economic companies and legal persons of other organizational and legal forms is understood as creation of the new economic company or of the legal person of other organizational and legal form by transferring of all rights and duties of the economic companies or of the economic companies and legal persons, taking part in the merging, to the new legal person formed as a result of merging, and termination of activities of the economic companies or of the economic companies and legal persons, taking part in the merging, in accordance with the procedure established by this Law and other legislative acts.

The economic companies and the legal persons of other organizational and legal forms, taking part in merging, conclude the agreement on merging, determining the procedure and conditions of merging. This agreement is subject to approving by the general meetings of participants of each of the economic companies and by the founders (participants) of each of legal persons of other organizational and legal forms, or by the governing bodies of such legal persons, duly authorized in accordance with the constituent documents. The joint general meeting of participants of economic companies and founders (participants) of legal persons of other organizational and legal forms, taking part in merging, or of the governing bodies of such legal persons, duly authorized in accordance with the constituent documents, approves the constituent documents of the newly formed economic company or the legal person of other organizational and legal form, and forms the bodies thereof. The procedure of voting on the joint general meeting is determined by the agreement on the merging or by that meeting.

In case of merging of the economic companies or of the economic companies and legal persons of other organizational and legal forms, the right and duties thereof are transferred, in accordance with the transfer act, to the newly formed economic company or the legal person of other organizational and legal form.

Article 17. Affiliation to the economic company

Affiliation to the economic company is understood as termination of activities of one or several affiliated economic companies and/or of one or several legal persons of other organizational and legal forms, with transferring the rights and duties thereof to the economic company, to which those economic companies or legal persons of other organizational and legal forms are affiliated.

The economic company and/or a legal person of other organizational and legal form, being affiliated, and the economic company to which the affiliation is made conclude contract on affiliation in which they determine the procedure for and the conditions of affiliation. This agreement is subject to approving by the general meetings of participants of each of the economic companies and by the founders (participants) of each of legal persons of other organizational and legal forms, or by the governing bodies of such legal persons, duly authorized in accordance with the constituent documents. The joint general meeting of participants of economic companies and founders (participants) of legal persons of other organizational and legal forms, taking part in affiliation, or of the governing bodies of such legal persons, duly authorized in accordance with the constituent documents, makes the decisions on changes and additions in the constituent documents of the economic company, to which the affiliation is carried out. The procedure of voting on the joint general meeting is determined by the contract on joining or at that joint meeting.

In case of affiliation of the economic company and/or the legal person of other organizational and legal form to another economic company, the rights and duties of affiliated economic company and/or the legal person of other organizational and legal form are transferred, in accordance with the transfer act, to the economic company to which the affiliation is carried out.

Article 18. Splitting-up of the economic company

Splitting-up of the economic company is understood as termination of the activity thereof, with transferring the rights and duties to the newly formed economic companies and/or legal persons of other organizational and legal forms.

General meeting of participants of the economic company makes a decision on the procedure and conditions of the splitting-up, on the creation of new economic companies and/or legal persons of other organizational and legal forms, on the structure of participants thereof. General meetings of participants of each of the economic companies newly formed as a result of splitting-up, and/or the founders (participants) of each of legal persons of other organizational and legal forms newly formed as a result of splitting-up, approve the constituent documents and form the bodies thereof.

After splitting-up the economic company, the rights and duties thereof are transferred, in accordance with the splitting balance, to the newly formed economic companies and/or to the legal persons of other organizational and legal forms.

Article 19. Splitting-off from the economic company

Splitting-off from the economic company is understood as creation of one or several new economic companies and/or legal persons of other organizational and legal forms, with transferring part of the rights and duties of reorganized economic company to the newly formed economic companies and/or legal persons of other organizational and legal forms, but without the termination of activity of reorganized economic company.

General meeting of participants of the economic company makes a decision on the procedure and conditions of splitting-off, on the creation of new economic company (economic companies) and/or the legal person of other organizational and legal form (legal persons of other organizational and legal forms), the structure of participants thereof. Founders (participants) of each of newly formed economic companies and/or legal persons of other organizational and legal forms as a result of an splitting-off may be only the reorganized economic company and/or its participants, upon their consent. General meeting of participants of each economic company and/or the founders (participants) of each legal person of other organizational and legal forms, newly formed as a result of splitting-off, approve the constituent documents and form the bodies thereof.

In the instance of splitting-off from the economic company of a new economic company the sole participant of which is the reorganized economic company, approval of the statute of that company, formation of its bodies, election of members thereof shall be carried out by the general meeting of participants of the reorganized economic company. The initial alienation of a stake (part of the stake) in the statutory fund (shares) of the economic company that has arisen as a result of an splitting-off, the sole participant of  which is the reorganized economic company, shall be carried out according to a decision of the general meeting of participants of the reorganized economic company in the order and on conditions, determined by that general meeting.

Reorganization of the economic company consisting of one participant in the form of splitting-off as a result of which another economic company arises the sole participant of which would be the reorganized economic company is not allowed.

After splitting-off one or several economic companies and/or legal persons of other organizational and legal forms from the economic company, the rights and duties of the reorganized economic company are transferred, in accordance with the splitting balance, to the newly formed economic companies and/or to the legal persons of other organizational and legal forms.

Article 20. Transformation of the economic company

The economic company of one form or one kind may be transformed to the economic company of another form or another kind or to the economic partnership, production co-operative or unitary enterprise in the order established by this Law and other legislative acts, with the exception of the economic company consisting of one participant which may be transformed to an economic company of another form or another kind or to a unitary enterprise.

General meeting of participants of the transformed economic company makes a decision on transformation, on the procedure and conditions of transformation. General meeting of participants of the economic company of other form or other kind or the founders (participants) of the legal person of other organizational and legal form, newly formed as a result of transformation, approve the constituent documents and form the bodies thereof.

After transformation of the economic company, the rights and duties thereof are transferred, in accordance with the transfer act, to the newly formed economic company of other form or other kind or the legal person of other organizational and legal form, with the exception of the rights and duties which cannot be vested in the newly formed economic company of other form or other kind or in the legal person of other organizational and legal form.

Article 21. Reorganization of the economic company by the decision of the competent state bodies, including the court

In the cases and in accordance with the procedure established by the legislative acts, reorganization of the economic company is carried out by the decision of the competent state bodies, including the courts.

If the participants of the economic company, the governing body of the economic company authorized by them, or the governing body of the economic company, authorized for carrying out the reorganization by the statute thereof, will not carry out the reorganization of the economic company within the terms specified in the decision of the competent state body, the court, at the claim of before-mentioned state body, appoints the administrator of the economic company, entrusting the reorganization of the economic company to that administrator. Since the date of appointing of the administrator, the powers for managing the activities of the economic company are transferred to that administrator. The administrator acts on behalf of the economic company in the court, draws up the splitting balance or the transfer act and submits those documents for consideration of the court, together with the constituent documents of economic companies or legal persons of other organizational and legal forms, formed as a result of reorganization. The approval of those documents by the court is the ground for the state registration of newly formed economic companies and/or legal persons of other organizational and legal forms.

Article 22. Transfer act and splitting balance drawn up in the case of reorganization of the economic company

At reorganization of the economic company  in accordance with Articles 16-20 of this Law, the transfer act or splitting balance shall be drawn up.

The transfer act and splitting balance must contain the provisions on the legal succession for all obligations of the reorganized economic company concerning all creditors and debtors thereof, including the obligations contested by the parties.

The transfer act and splitting balance shall be approved by the general meeting of the economic company or the body which adopted the decision on reorganization of that company.

Article 23. Warranties of the rights of creditors at reorganization of the economic company

The reorganized economic company or the body, which have made a decision on reorganization of the economic company, are obliged to notify the creditors of the reorganized economic company thereon in writing.

The notification of the persons, which are the creditors of the economic company at the date of making the decision on reorganization thereof, is carried out not later than thirty days after the date of making the decision on reorganization of the company, or, in case of reorganization of the economic company in the form of merging or affiliation after the date of making of such decision by the last of the economic companies or legal persons of other organizational and legal forms, taking part in merging or affiliation. Other persons are notified on the decision on reorganization of the economic company at the conclusion of agreements with those persons.

The creditor of the reorganized economic company has the right to claim for the termination of the obligations, concerning which the company is the debtor, or fulfilling those obligations before due date, and compensation of damages.

Claims of creditor are submitted to the economic company in writing within thirty days after the date of reception, by the creditor, of the notification on the decision on reorganization of the economic company.

If the splitting balance does not give an opportunity to determine the legal successor of the reorganized economic company, the formed legal persons are jointly and severally liable for the obligations of that company to the creditors thereof.

Article 24. Liquidation of the economic company

Liquidation of the economic company entails the termination of activity thereof without transferring of the rights and duties, by way of legal succession, to other persons, unless otherwise provided by the legislative acts.

The economic company may be liquidated in accordance with its statute according to a decision of the general meeting of participants of that company, taken in accordance with this Law and other legislative acts.

In the cases and under the procedure established by the legislative acts, liquidation of the economic company is carried out on the decision of registering body or on the court decision.

Upon adoption of a decision on liquidation of the legal person being the sole participant of an economic company, a decision on liquidation of that economic company must be adopted.

If the value of the property of the economic company in relation to which a decision on liquidation has been adopted is insufficient for satisfaction of the claims of creditors or the property is absent, after approval of the intermediate liquidation balance the economic company may be liquidated only in the order established by the legislation on economic insolvency (bankruptcy).

After making the decision on liquidation of the economic company, the list of participants of that company can be changed only on a court decision.

The liquidation of the economic company is considered terminated, and the economic company liquidated from the date of adoption by the registering body of the decision on entering in the Unified State Register of Legal Persons and Individual Entrepreneurs of the record about the exclusion thereof from that register.

Article 25.  Liquidation commission (liquidator) of the economic company

The general meeting of participants of the economic company, which has adopted the decision on its liquidation, shall appoint the liquidation  commission (liquidator), chairperson of the liquidation commission, distribute the duties among the chairperson and members of the liquidation commission (in the instance of appointment of the liquidation commission) and establishes the procedure and the terms of the liquidation.

The powers to manage activities of the economic company, including those of the head of the economic company, are transferred to the liquidation commission from the day of its appointment.

The liquidation commission (liquidator), on behalf of the liquidated economic company:

appears in the court;

resolves all the issues on liquidation of the economic company within the limits of the competence established by the legislation.

The chairperson of the liquidation commission (liquidator) is obliged, within ten working days after the date of adoption of the decision on liquidation of the economic company, to notify, in the order established by legislative acts, thereon the registering body for inclusion in the Unified State Register of Legal Persons and Individual Entrepreneurs of the data about the fact that the economic company is in the process of liquidation.

Unless otherwise determined by legislative acts, the data about the fact that the economic company is in the process of liquidation, on the order and time limit for declaring claims by its creditors shall be placed in the global computer network Internet on the official site of the legal scientific and practical journal "Justice of Belarus" with subsequent publication in the annex to the mentioned journal. That time limit may not be less than two months from the date of placement of the data about the fact that the economic company is in the process of liquidation.

The liquidation commission (liquidator) of the economic company takes all possible measures for revealing the creditors and reception of the payments on the accounts receivable, notifies the creditors, in writing, on the liquidation of the company, and takes other measures concerning the liquidation.

After the expiration of term for submitting the claims by the creditors, the liquidation commission (liquidator) of the economic company draws up the intermediate liquidation balance, which contains data on the list of property of liquidated economic company, the list of the claims submitted by the creditors, and on the results of consideration of those claims.

The intermediate liquidation balance shall be approved by the general meeting of participants of the economic company.

After termination of settlements with creditors the liquidation commission (liquidator) of the economic company draws up the liquidation balance which is approved by the general meeting of participants of the economic company.

Article 26. Satisfaction of claims of the creditors at liquidation of the economic company

Payment of monetary sums to the creditors of the liquidated economic company shall be made by the liquidation commission (liquidator) in accordance with the procedure and in sequence established by the legislative acts, in accordance with the intermediate liquidation balance.

If monetary funds of the liquidated economic company are insufficient for satisfaction of claims of the creditors, the liquidation commission (liquidator) carries out the public sale of property of the economic company in accordance with the order established by legislation.

If, after liquidation of the economic company, it would be proved that that company, with the purposes of avoidance of the liability to the creditors, has transmitted to other person or otherwise has intentionally hidden at least part of the property thereof, the creditors, who have not received complete satisfaction of the claims within the limits of liquidation proceedings, have the right to levy execution upon that property for the non-paid part of the debt. In that instance, the rules of settlements at the return of the property from illegal possession, established by the Civil Code of the Republic of Belarus, shall be accordingly applied.

Article 27. Distribution of property at liquidation of the economic company between the participants thereof

At liquidation of the economic company, the property thereof, remained after settlements with the creditors, is distributed by the liquidation commission (liquidator) between the participants of the economic company in accordance with the order of priority established by this Law for various forms of the economic company.

The property, given by the founders (participants) in possession and use of the economic company for the specific time limit as the contribution to the statutory fund of the economic company, at liquidation of the economic company, is subject to return by the liquidation commission (liquidator) to those founders (participants) in kind, taking into consideration the natural wear and tear.

At liquidation of the economic company, the claims of each following turn of the participants thereof are satisfied after complete satisfaction of claims of the previous turn.

If at liquidation of the economic company, the property remained is insufficient for the full satisfaction of the claims of participants of one turn, the claims are satisfied using the available property, proportionally to the claims of those participants.

CHAPTER 3
STATUTORY FUND AND OTHER FUNDS, PROPERTY AND SECURITIES OF THE ECONOMIC COMPANY

Article 28. Statutory fund of the economic company

At creation of the economic company, the statutory fund thereof is formed in accordance with the procedure established by this Law and other legislation.

The statutory fund of the economic company determines the minimum amount of property of that company, guaranteeing the interests of the creditors thereof.

The terms of formation of the statutory fund of the economic company, corresponding to the form, kind and scope of activity of the economic company, are established by the legislation.

If at the end of the second and every following financial year the cost of net assets of the economic company is less than the statutory fund, that company is obliged to decrease its authorized capital to the size not exceeding the cost of its net assets.

In the instance of adoption of the decision on reducing the statutory fund, the economic company is obliged, within thirty days from the date of adoption of such decision, notify the creditors of the company, in writing, on the reduction of the statutory fund of the company and on its new amount, or place in the global computer network Internet on the official site of the legal scientific and practical journal "Justice of Belarus" with subsequent publication in the annex to the mentioned journal of the notification about the adopted decision. The creditors of the economic company have the right, within thirty days after the date of sending the notification to them, or within thirty days from the date of placement of the notification about the adopted decision, to demand, in writing, premature termination or fulfilling of corresponding obligations of that company and compensation of losses.

The economic company also has the right to make a decision on changing the statutory fund thereof in other cases in accordance with the procedure established by this Law.

Article 29. Contributions to the statutory fund of the economic company

The contributions to the statutory fund of the economic company can be things, including monetary means and securities, and other property, including property rights, or other alienated rights having a money value.

The property being contributed to the statutory fund of the economic company must belong to the founders (participants) on the right of ownership, right of economic management or of operative administration. The property cannot be contributed to the statutory fund of the economic company, if the right for the alienation thereof is limited by the owner, by the legislation or by the agreement.

The statutory fund of the economic company may not be formed completely by non-monetary contributions in the form of property rights. With regard to that the volume of property rights contributed to the statutory fund of the economic company may not exceed 50 percent of the statutory fund of the economic company. The statute of the economic company may determine kinds of property that may not be contributed to the statutory fund of that company.

When a non-monetary contribution is made to the statutory fund of the economic company, an assessment of its value muse performed. In the event of performing an independent assessment of the value of a non-monetary contribution being made to the statutory fund of the economic company, the expert examination of that assessment is not made.

If the right for using the property for a limited time limit is contributed by the founders (participants) to the statutory fund of the economic company, the value of such contribution is determined on the basis of the rent calculated for the full before-mentioned time limit in accordance with the procedure established by the legislation. In case of termination of the right for using the property or liquidation of the economic company before the time limit specified, the contribution of the participant is considered as not contributed in the amount equal to the amount of the rent for the period remained, unless otherwise provided by the statute. The risk of accidental loss, accidental breakdown or the accidental damage to the property contributed in the form of non-monetary contribution to the statutory fund of the economic company, is assigned to that company.

The exemption of a participant of the economic company should from the obligation to make the contribution to the statutory fund (paying up of shares), including by means of an offset against the claims toward the economic company is not allowed, with the exception of the cases established by the legislative acts.

Article 30. Reserve fund and other funds of the economic company

In the cases established by the legislation, the reserve funds are formed in the economic company. The amount, the sources and the procedure of creation and using of the reserve funds is established by the legislation.

The economic company can make up other funds, formed and used in accordance with the legislation or with the statute of the economic company.

Article 31. Property of the economic company

The property of the economic company includes:

the property submitted by the founders (participants) of the economic company to the statutory fund thereof as the contributions;

the property acquired by the economic company in the process of implementation of the entrepreneurial activity;

the earnings obtained as a result of using the property (yields, production, incomes) unless otherwise provided by the legislation or the agreement on using that property;

the property of the unitary enterprises and institutions founded by the economic company;

the property acquired by the economic company on other grounds permitted by the legislation.

Compulsory seizure of property of the economic company is prohibited, except for the cases provided by the legislative acts, or in accordance with the court ruling.

The property can be transferred to the economic company for possession and using in accordance with the procedure established by the legislation.

Formation of property of the economic companies newly formed as a result of reorganization of other economic companies or legal persons of other organizational and legal forms is carried out from the property of the legal persons participating in reorganization.

Article 32. Securities of the economic company

The economic company carries out issue of equity securities in cases and in accordance with the procedure established by this Law and the legislation on securities.

The economic company has the right to hand out non-equity securities in accordance with the procedure established by the legislation on securities.

The economic company shall ensure the state registration (registration) of securities issued or handed out thereby in accordance with the procedure established by the legislation.

CHAPTER 4
BODIES OF THE ECONOMIC COMPANY AND MANAGEMENT IN THE ECONOMIC COMPANY

Article 33. General provisions on the bodies of the economic company

The bodies of the economic company are the governing bodies of the economic company and the controlling bodies thereof. The procedure of formation the bodies of the economic company and election of the members thereof is determined by this Law, other legislative acts and the statute of the economic company.

The supreme governing body of the economic company is the general meeting of participants of the economic company. In an economic company consisting of one participant, the general meeting of participants of the economic company is not convoked and held. Powers of the general meetings of participants of the economic company are carried out by that participant.

In the economic company, the following governing bodies are also formed:

board of directors (supervisory board), in accordance with this Law, other legislative acts and the statute;

executive body of the economic company, the collective executive body (board or directorate) and/or the one-person executive body (director or director general), in accordance with this Law and the statute.

The controlling body of the economic company is the inspection commission or the inspector of the economic company. The general meeting of participants of the economic company can also form other controlling bodies, if formation of such bodies is provided by the statute in accordance with this Law.

The board of directors (supervisory board), executive and controlling bodies are accountable to the general meeting of participants of the economic company, and in the economic company consisting of one participant – to that participant..

Members of bodies of the economic company, at exercising  their rights and fulfilling the duties:

must act on the basis of openness (bring to the knowledge of the general meeting and the board of directors (supervisory board) of the economic company information in accordance with requirements of this Law, other legislation, the statute and/or local normative legal acts of the economic company, and also bring to knowledge other information which may affected the exercising by the members of that council of their powers) in the interests of that company honesty and reasonably;

must ensure equal and just attitude to all participants of the economic company;

must not use the property of the economic company or allow its use not in accordance with the statute of that company, decisions of the general meeting of participants and/or board of directors (supervisory board council), and also for personal purposes;

must not evade the fulfilment of their duties provided by this Law and the statute of the economic company.

Members of bodies of the economic company, in accordance with the competence thereof, are liable before the economic company for the losses caused to that company by their culpable actions (culpable omission) in accordance with the procedure established by the statute of the economic company and by the legislation. However, the members of bodies of the economic company who voted against the decisions which has entailed the losses for the company or did not take part in such voting, are not liable, unless otherwise established by Article 571 of this Law, and also in other cases established by the legislative acts. In the event when several members of bodies of the economic company are liable, their liability before the economic company is joint and several. In the event of refusal of members of the bodies of the economic company to reimburse the losses voluntarily, the losses may be collected for the company in the court on the claim of the company itself, of members of the board of directors (supervisory board), and also of participants of the economic company authorized by the decision of the general meeting, taken by the majority not less than three quarters of the votes of persons which have participated in that meeting.

Article 34. Exclusive competence of the general meeting of participants of the economic company

The exclusive competence of the general meeting of participants of the economic company includes:

change of the statute of the economic company;

change of the amount of the statutory fund of the economic company;

election of the members of the board of directors (supervisory board) and of the inspection commission (inspector) of the economic company and the early termination of their powers with the exception of cases when in accordance with part five of Article 51 of this Law the powers of the member (members) of the board of directors (supervisory board) are terminated early without taking the decision of the general meeting of participants of the economic company;

approval of annual reports, annual accounting (financial) reports of the economic company (data of the inventory book of incomes and expenses) and distribution of profit and losses of that company upon availability of and with regard to the conclusion of the inspection commission (inspector), and in the instances established by this Law –  the auditing report;

making the decision on reorganization of the economic company and on the approval of the transfer act or splitting balance;

making the decision on liquidation of the economic company, establishing of the liquidation commission, appointment of the chairman thereof or the liquidator, approval of intermediate liquidation balance and liquidation balance, except for the cases when the decision on liquidation of the company is made by the registering body or by the court in accordance with the legislative acts;

determination of the sums of fees and refunds of charges for the members of the board of directors (supervisory board), of the inspection commission (inspector) of the economic company for fulfilling their duties;

approval of local normative acts of the economic company, in the cases provided by this Law;

granting to other governing bodies of the economic company of the right of one-time adoption of decisions on specific matters not included in the exclusive competence of the general meeting of participants of the economic company;

determination of the procedure of general meeting of participants of the economic company, in the aspects not stipulated by this Law, other legislation, the statute and local normative acts of the economic company;

resolving other matters provided for by this Code and other legislative acts.

The statute of the economic company can provide including of another matters in the exclusive competence of the general meeting of participants of the economic company.

The matters included in the exclusive competence of the general meeting of participants of the economic company, cannot be assigned for the decision by other governing bodies of the company.

Article 35. Competence of the general meeting of participants of the economic company

The competence of the general meeting of participants of the economic company includes:

determination of the basic directions of activity of the economic company;

decision on creation of associations of legal persons, not being legal persons and on participation in such associations;

decision on establishing and liquidation of representative offices and affiliates of the economic company;

decision on establishing other legal persons and on participation in the activities thereof;

decision on founding, reorganization and liquidation by the economic company of unitary enterprises and institutions;

determination of terms of remuneration for the work of members of the executive bodies of the economic company, or payment of services of the managing organization (managing director);

approval of the assessment of value of non-monetary contributions to the statutory fund of the economic company on the basis of the conclusion on the assessment or expert examination of the accuracy of the assessment of the value of the non-monetary contribution;

making the decisions on granting the gratuitous (sponsor's) help in accordance with the legislative acts;

making the decisions on the other matters provided by this Law.

The matters which are, in accordance with part one of this Article, included in the competence of the general meting of participants of the economic company, can be included, in accordance with the statute, to the competence of the board of directors (supervisory board) of the economic company.

The matters referred by part one of this Article to the competence of the general meeting of participants of the economic company, may not be assigned for consideration of the executive body of the economic company, with the exception of matters of creation and liquidation of the representative offices and affiliates of that company; which may be referred by the statute to the competence of the executive body in the instance if the formation in the economic company of the board of directors (supervisory board)  is not provided for, and also of the matter on granting gratuitous (sponsor) aid in accordance with part one of this Article.

The matter on granting gratuitous (sponsor) may be assigned by the statute of the economic company to its executive body with imposition thereon of the duty to report quarterly about granting such aid to the board of directors (supervisory board) of that company or to the general meeting of participants of the economic company in the instance if the formation in the economic company of the board of directors (supervisory board)  is not provided for.

Article 36. General meeting of participants of the economic company

In cases and in accordance with the procedure established by this Law and the statute of the economic company, regular and extraordinary general meetings of the participants of the economic company shall be convoked and held.

The regular general meetings of participants of the economic company shall be carried out at least once a year, within the time limit established by the statute.

The economic company is obliged to hold annually the annual general meeting of participants of the economic company, on which annual reports, annual accounting (financial) statements (data of the journal of incomes and expenses) and distribution of profit and losses are to be approved. Approval of annual reports, annual accounting (financial) reports (data of the journal of incomes and expenses) and distribution of profit and losses of the economic company shall be carried out upon availability of and with regard to the conclusion of the inspection commission (inspector), and in the instances established by this Law –  the auditing report;

The annual general meeting of participants of the economic company is carried out in time, established by the statute, but not later than within three months after the expiration of fiscal year. In the event when the authorized body of the economic company does not convene the annual general meeting of participants of the economic company under the established procedure, it may be convened by bodies or participants (participant) of the economic company, which have the right to demand to hold an extraordinary general meeting. At the annual general meeting of participants of the economic company, the matters of election of the members of the board of directors (supervisory board), if its formation thereof is provided for by this Law, other legislative acts and the statute of the economic company) and of the inspection commission (inspector) must also be considered.

The general meetings of participants of the economic company are convened and carried out by the authorized body of the economic company or, in the cases established by this Law, by other bodies of the company, or by the participants requiring the convocation of the extraordinary general meeting of participants of the economic company.

The general meeting of participants of the economic company is held under the procedure established by this Law and the statute, and in the part not regulated by them – by local normative acts of the economic company approved by the general meeting of its participants and/or by decisions of that meeting.

Additional requirements for the preparation, convocation and holding of the general meeting of participants of the economic company, with the exception of the requirements established by this Law, may be specified by the appropriate local normative legal act of the economic company, approved by the general meeting of participants thereof.

Provisions of this Article determining the order and time limits for convocation and holding the general meeting of participants of the economic company are not applied to the economic company consisting of one participant, with the exception of the time limit established by part four of this Article for holding the annual meeting of participants of the economic company within which that participant must adopt decisions o matters provided for by parts three and four of this Article.

Article 37. Persons having the right to participation in the general meeting of participants of the economic company

The persons having the right to participation in the general meeting of participants of the economic company, are the following:

the participants of the economic company or the persons authorized for participation in the general meeting by the power of attorney issued by the participants of the economic company;

other persons determined in part twelve of Article 13 of this Law.

Article 38. Preparation for holding the general meeting of participants of the economic company

The authorized body of the economic company, in the terms established by the statute in accordance with this Law, shall adopt a decision on holding the general meeting of participants of the economic company, specifying:

date, time and location (the address) of holding the general meeting of participants of the economic company;

the agenda of general meeting of participants of the economic company, with the formulations of draft decisions on each matter;

the form of holding the general meeting of participants of the economic company, unless is specified by the statute or the bodies of the economic company, the participants thereof or by the audit organization (the auditor carrying out activity as individual entrepreneur), requiring the convocation of extraordinary general meeting of participants of the economic company in the cases provided by this Law;

the form of voting on each issue of the agenda;

the form and the text of the ballot, in case of voting by ballots or absentee voting;

the form and the text of the card, in case of open voting by cards;

the procedure of notification of the persons having, in accordance with Article 37 of this Law, the right to participate in the general meeting of participants of the economic company (hereinafter referred to as the persons having the right for participation in the general meeting), concerning holding the general meeting, unless that procedure is specified by the statute;

the list of information (documents) and the procedure of providing thereof for the persons having the right to participation in the general meeting (the procedure of familiarization of those persons with the appropriate information), at preparation for holding that meeting. In the instance of holding the general meeting of participants of the economic company the agenda of which includes the matter on election of members of bodies of the economic company, the mentioned list shall include the data about candidates promoted to the bodies of the economic company to be elected (formed);

the procedure of registration of the persons having the right for participation in the general meeting.

The decision on holding the general meeting of participants of the economic company may also contain other information, which is reasonable in each specific case.

Article 39. Notification on holding the general meeting of participants of the economic company

The persons having the right for participation in the general meeting are notified on the decision on holding the general meeting of participants of the economic company by the authorized body of the economic company not less than thirty days prior to the date of the general meeting, unless a lesser term is not provided by the statute, or another time limit established by parts two and four of this Article.

The notice on carrying out the extraordinary general meeting of participants of the economic company, the agenda of which includes the election of the members of the board of directors (supervisory board) by cumulative voting, must be sent not less than fifty days prior to the date of that meeting, unless a lesser time limit is provided by the statute.

For the purposes of this Law, cumulative voting is understood as a method of voting, where the number of votes, belonging to each participant of the economic company or other person having the right for participation in the general meeting, is multiplied by the number of persons which must be elected to the board of directors (supervisory board). In such a case, the participant of the economic company or other person having the right for participation in the general meeting, have the right to give the votes, obtained thus, completely for one candidate, or to distribute those votes between two or more candidates.

The notification on holding the repeat general meeting of participants of the economic company in accordance with part two of Article 43 of this Law, must be sent not less than ten days prior to the date of meeting, unless another time limit is provided by the statute.

The notification about holding the general meeting of participants of the economic company must be sent to persons having the right to participate in the general meeting by a registered letter, unless the statute of the economic company provides another method of sending that notification in a written form, or be handed in to each of the mentioned persons against signature, or, if it is provided by the statute of the company, be printed in a printed mass medium accessible for all participants, determined in the statute of the company, and/or place on the site of the economic company in the global computer network Internet.

The notification about holding the general meeting of participants of the economic company with the number of participants not exceeding one hundred must be sent to persons having the right to participate in the general meeting by a registered letter, unless the statute of the economic company provides another method of sending the notification.

The notification about holding the general meeting of participants of the economic company shall contain:

name and the location of the economic company;

the date, time and location (the address) of holding the general meeting of participants of the economic company;

the agenda of the general meeting of participants of the economic company;

the body of the economic company or another persons convening the general meeting of participants of the economic company, the ground for its convening (in the event of convening and holding of the extraordinary general meeting of participants of the economic company);

the procedure for the persons having the right for participation in the general meeting to get knowledge of the information (documents) subject to be presented when preparing the holding of that meeting with indication of the address where it can be familiarized with;

the procedure of registration of the persons having the right for participation in the general meeting;

other data provided by the statute of the economic company and/or the decision on holding the general meeting of participants of the economic company.

Prior to holding the annual general meeting of participants of the economic company, its executive body is obliged to prepare information about activity of that company for the reporting period which must contain:

overview of most important events in the activities of the economic company occurred within the reporting period;

names of economic companies, amount of stakes in statutory funds (number of shares) belonging to the economic company;

amount of stakes in the statutory fund (number of shares) alienated by the economic company within the reporting period;

amount of stakes in the statutory fund (number of shares) acquired by the economic company within the reporting period;

information about large transactions, other transactions adoption of the decision on performance of which is covered by the order of adoption of a decision on performance of a large transaction, and also about transactions of the economic company in the performance of which its affiliated persons have an interest, in the volume determined by part eight of Article 57 of this Law;

plans and forecasts of the activities of the economic company for the forthcoming financial year;

other information the obligation for bringing it to the knowledge of participants of the economic company is provided for by this Law, other legislation, the statute and/or local normative legal acts of that company.

On the initiative of the executive body of the economic company, authorized body of the economic company, information about activities of that economic company for the reporting period may also include other data.

Not less than twenty days prior to holding the general meeting of participants of the economic company, information about activities of that economic company for the reporting period must be accessible for familiarization by persons having the right to participation in the general meeting of participants of the economic company, in places the addresses of which are indication in the notification about holding the general meeting. That information must be accessible to persons taking part in the general meeting also during its holding.

Article 40. Proposals for the agenda of the general meeting of participants of the economic company

The persons having the right for participation in the general meeting, in accordance with the procedure provided by the statute of the economic company, have the right to make proposals, in writing, on inclusion of the issues in the agenda of the general meeting of participants of the economic company and on the nomination of candidates members of the board of directors (supervisory board) and the inspection commission (inspector), and also on the nomination of candidates for the executive body of the economic company.

The number of candidates, nominated in one proposal, cannot exceed the number of persons in the corresponding body of the economic company.

The proposal for the agenda of the general meeting of participants of the economic company must contain the name of the natural person or the name of the legal person, number of votes thereof on the general meeting of participants of the company, the formulation of each of the issues proposed for the agenda. The proposal for the agenda on the nomination of candidates in the elected (formed) bodies of the economic company must contain also the name of each nominated candidate, the name of the body of the economic company for which the candidate is nominated and other data on the candidate, in accordance with the statute. Inclusion on the agenda of a proposal on nomination of candidates to elected (formed) bodies of the economic company is made with their consent obtained under the procedure established by the local normative legal act of the economic company approved by the general meeting of its participants. The persons having the right, in accordance with part one of this Article, the right for making the proposals, can also propose the formulation of the draft decision on each of the issues proposed. The proposal must be signed by the persons who have introduced that proposal.

Proposals for the agenda of the annual general meeting of participants of the economic company must arrive not later than thirty days after expiration of the accounting year, unless other time limits of arrival of such proposals are provided by the statute.

Proposals for the agenda of the extraordinary general meeting of participants of the economic company, one of issues of which is the election of the members of the board of directors (supervisory board) by cumulative voting, must arrive not later than thirty days prior to the date of that extraordinary general meeting, unless other time limits of arrival of such proposals are provided by the statute.

Article 41. Agenda of the general meeting of participants of the economic company;

The agenda of general meeting of participants of the economic company is drawn up by the authorized body of the economic company at own discretion thereof, and on the basis of proposals of the persons having the right for making the proposals for the agenda. The agenda of the general meeting of participants of the economic company must contain the full list of explicitly formulated issues submitted for discussion.

The authorized body of the economic company, not later than ten days after the expiration of the time limit established for the arrival of proposals for the agenda, is obliged to consider those proposals and make a decision on the acceptance or rejection. The proposals are subject to rejection in the following cases:

the procedure for introducing the proposals established by this Law and by the statute is violated by the participant (participants);

the proposals are not within the competence of the general meeting of participants of the economic company;

the proposals do not meet the requirements of this Law and other legislative acts;

the candidates, nominated for the formed bodies of the economic company, do not meet the requirements established by this Law, statute and/or the local normative legal acts of the economic company, approved by the general meeting of participants thereof.

In case of rejection of the proposal, the authorized body of the economic company must send its reasoned notification about the rejection, not later than five days from the date of its adoption,  to the person who submitted those proposals.

The authorized body of the economic company is not entitled to introduce changes in the formulations of the issues, proposed for inclusion in the agenda of the general meeting by persons having the right to introduce proposal for the agenda.

In case of making the decision on changing the agenda of the general meeting of participants of the economic company, determined at making the decision on the convocation and carrying out the meeting, the authorized body of the economic company is obliged, in accordance with the procedure established by the statute or by that body within the time limit established by the statute, but not less than ten days prior to the date of the general meeting, to inform the persons, having the right for participation in the meeting, on the change of the agenda.

The decision of the authorized body of the economic company on the reasoned rejection of the proposals for the agenda, or evasion of that body from making the appropriate decision, may be contested in the court by persons who submitted those proposals.

Article 42. Form of holding the general meeting of participants of the economic company

The general meeting of participants of the economic company can be carried out in the in-person, absentee or mixed form.

The in-person form of holding the general meeting of participants of the economic company provides joint presence of the persons having the right for participation in that general meeting, at consideration of issues of the agenda of the meeting and at making the decisions on them.

At holding the general meeting of participants of the economic company in the absentee form, the opinion of the persons having the right for participation in that general meeting, concerning the issues of the agenda of the meeting, submitted for voting, is determined by means of a written polling among them (absentee voting).

The mixed form of holding the general meeting of participants of the economic company allows the persons, having the right for participation in that general meeting, to vote on the issues of the agenda of the meeting either at personal presence at the meeting, or by means of a written polling among them (absentee voting).

Article 43. Competency (quorum) of the general meeting of participants of the economic company

The persons who have been registered for participation in the general meeting of participants of the economic company, and/or persons whose filled ballots were obtained in accordance with the procedure established by the statute or the local normative legal act, are considered as the persons participated in the meeting.

The general meeting of participants of the economic company is considered as competent (having the quorum), if the participants thereof have, in total, more than fifty percent of votes from the total number of the votes belonging to the participants of the economic company, unless a greater number of votes is provided for the quorum by the statute of the economic company. In case of absence of the quorum established, the annual general meeting of participants of the economic company should be conducted, and extraordinary general meeting of participants of the economic company may be conducted repeatedly with the same agenda. Repeated general meeting of participants of the economic company has the quorum, if the participants thereof have, in total, more than thirty percent of votes from the total number of votes, unless a greater number of votes is provided for the quorum by the statute of the economic company.

At holding the general meeting of participants of the economic company in the in-person form, the registration of the persons, having the right for participation in the general meeting, is carried out subject to submitting the documents confirming their powers, and competency (presence of a quorum) of that meeting is determined. The persons who were not registered have not the right to participate in voting.

At determination of the quorum of general meeting of participants of the economic company, carried out in the absentee or mixed form, the votes submitted by the voting ballots, obtained in accordance with the procedure established by the statute or by the local normative legal act of the economic company, approved by the general meeting of participants of the company, in accordance with this Law, are considered.

For confirmation of the quorum and for counting of votes at making the decisions by the general meeting of participants of the economic company concerning the agenda, in the cases and for the time limit specified in the statute of the economic company, the counting commission may be formed, the numerical and personal composition of which is to be approved by the general meeting participant of the economic company. Creation of the counting commission of a joint-stock company  is mandatory in the case provided by part one of Article 82 of this Law.

Article 44. Holding of the general meeting of participants of the economic company

The general meeting of participants of the economic company should never make the decisions concerning the matters not included in the agenda of the meeting, or make changes in the agenda, with the exception of the case when such decision is made unanimously by the general meeting, in which all the persons are participating, having the right for participation in that general meeting, unless otherwise provided by the statute.

The general meeting of participants of the economic company, carried out in the in-presence or mixed form, is presided by the chairman elected for the term and in accordance with the procedure specified by the statute and/or by that meeting. The person exercising the powers of the one-person executive body, or the chairman of the collective executive body of the economic company or the board of directors (supervisory board) can preside over the general meeting of participants of the economic company, unless otherwise provided by the statute and by this Law. Keeping the report of proceedings of the general meeting of participants of the economic company is carried out by the secretary of the meeting, elected or appointed in accordance with the procedure determined by the statute, if it is provided by the statute. In other cases, keeping the report of proceedings of the general meeting of participants of the economic company is provided by the chairman of that general meeting.

Article 45. Decision of the general meeting of participants of the economic company

At making the decision by the general meeting of participants of the economic company, the number of votes being in possession of the participant of that company is proportional to the size (quantity) of a stake belonging to that person in the statutory fund (shares) of the company; the number of votes being in possession of any other person having the right for participation in the general meeting is proportional to the size (quantity) of a stake of the statutory fund (shares), the right on which or the right management to which has been acquired by that person. Other procedure of determination of the number of votes being in possession of the participants of limited liability company or additional liability company can be established by the statutes thereof.

The decision of the general meeting of participants of the economic company is made by simple majority of votes (more than fifty percent) of the persons participating in the meeting, with the exception of the cases provided by this Law and the statute of the economic company, when, for making the decisions on some specific issues, the qualified majority of the number of votes of before-mentioned persons or of the total number of votes of participants of the economic company is required, or when the decision is made unanimously by before-mentioned persons or by all the participants of the economic company. The decision of the general meeting of participants of the economic company on approval of local normative legal acts in the instances provided by this Law are to be taken by the majority on not less than three quarters of the number of votes of the persons having participated in the general meeting of its participants.

The decisions of the general meeting of participants of the economic company concerning the election of the members of the board of directors (supervisory board) can be made by the cumulative voting. The candidate members obtained the maximum total number of votes are considered as elected members of the board of directors (supervisory board).

Decisions of the general meeting of participants of the economic company can be made in the form provided by the statute of the economic company in accordance with this Law, by the open voting or by the ballot voting. The statute may stipulated an open voting by cards.

The decisions of the general meeting of participants of the economic company, except for the matters of election of the members of the board of directors (supervisory board), members of the inspection commission (inspector), approval of the annual reports, annual accounting (financial) statements of the economic company (data of the inventory book of incomes and expenses), distribution of profit and losses of the economic company, and other matters specified in the statute, may be made by the absentee voting, without direct attendance of the persons having the right for participation in the general meeting, in accordance with the procedure established by the statute or the local normative legal act of the economic company approved by the general meeting of participants thereof.

Decisions adopted by the general meeting of participants of the economic company are announced at that meeting or are brought to the notice of the participants thereof not later than ten days after the date of signing of the report of proceedings of that meeting in accordance with the procedure established by the statute.

A decision of the general meeting of participants of the economic company adopted with violation of the requirements of this Law and other legislation or the statute of the economic company and infringing the rights and/or legal interests of a participant (former participant) of that company, may be contested in the court by the participant (former participant) of the joint-stock company within three months, and by a participant (former participant) of the limited liability company or additional liability company – within two months from the day when they become aware or should have become aware of the adoption of such a decision.

The court is entitled, having regard to all circumstances of the case, to uphold the contested decision if the vote of the participant (former participant) of the economic company could affect the results of the voting or execution of the decision did not entail infliction of damages to the participant (former participant) of the economic company or if arising of other non-favourable consequences for him and committed violations specified in part seven of this Article are not essential.

In the instance if the court satisfied the action of the participant (former participant) on contesting a decision of the general meetings of participants of the economic company, such decision is considered invalid from the moment of its adoption.

In the economic company consisting of one participant, decisions of the general meeting shall be written decisions of that participant. In the instance if the sole participant of the economic company is another economic company, the statute of the latter must determine the body authorized to adopt decisions on matters referred by the statute of the first economic company to the competence of the general meeting of its participants.

Article 46. Absentee voting

Absentee voting is carried out only by voting ballots. In that case, the authorized body of the economic company, in the decision on carrying out the absentee ballot, must determine the method of sending the ballots for the persons having the right to participation in the general meeting, the method and the place (with the address specified) of submission of the filled ballots to the economic company and the final date of receipt of the filled ballots, which may not be established later than two days prior to the date of holding the general meeting and also the person(s) authorized to count votes in case of absentee voting to sign the report of proceedings according to results of its holding.

The ballot for absentee voting should contain:

the name of the natural person (name of the legal person) having the right to participate in the general meeting of participants of the economic company and the number of votes thereof on the general meeting of participants of the company;

the name and the location of the economic company;

place (with the address specified), method of submission and final date of submission of the ballots for the absentee voting;

date and place of general meeting of participants of the economic company, date of counting the votes for the absentee voting;

the agenda of the general meeting of participants of the economic company;

the formulation of issues, voting on which is carried out using the ballot, and the formulation of decisions on each issue;

options for voting on each issue, expressed by the words "for", "against", "abstain";

explanation of the procedure of filling the ballot on each issue;

the message notifying that the ballot for the absentee voting should be signed by the person having the right for participation in general meeting.

The ballots for the absentee voting should be handed to the persons having the right for participation in the general meeting under their receipts, or sent to them by the registered letter or by another way provided by the statute or the local normative legal act of the economic company, approved by the general meeting of its participants, not later than thirty days prior to the date of holding the general meeting, unless another time limit is established by the constituent documents.

The ballot for the absentee voting of the natural person, having the right for participation in the general meeting, is signed by that natural person with the own hand thereof, with indication of identity documents or other data identifying that person.

The ballot for the absentee voting of the legal person, having the right for participation in the general meeting, is sealed by that legal person.

At counting of votes at the absentee voting, the votes on those issues, on which the ballot was duly filled by the person, having the right for participation in the general meeting, in accordance with the procedure specified in that ballot, and only one of possible choices of voting is noted.

The ballot for the absentee voting, at filling of which, the infringements of the requirements of this Article were committed, is considered void.

Article 47. Report of proceedings of the general meeting of participants of the economic company

As a result of holding the general meeting of participants of the economic company, the report of proceedings of the general meeting of participants of the economic company should be drawn up, not later than within five days after closing the meeting.

Report of proceedings is to be signed (with signing of each page, including the decision enclosed to the report of proceedings) by the chairperson of the general meeting of participants of the economic company, the secretary (if available), and also by not less than two members of the counting commission (if available) or, if it is provided by the statute, the persons having participated in that meeting. In addition to mentioned persons the report of proceedings may be signed by other persons according to the decision of the general meeting of participants of the economic company. The list of persons registered for participation in the general meeting of participants of the economic company and/or persons whose filled ballots were obtained in accordance with the procedure established by the statute are to be enclosed to the report of proceedings. The list of persons registered for participation in the general meeting of participants of the economic company shall contain signatures of those persons.

A copy of the protocol of proceedings of the general meetings of participants of the economic company shall be provided to participants of that company upon their request in the order stipulated by the statute of the economic company for providing information about the economic company. For providing a copy of the report of proceedings a payment may be charged the amount of which shall not exceed the expenses for its making.

Article 48. Grounds for holding the extraordinary general meeting of participants of the economic company

The extraordinary general meeting of participants of the economic company is carried out in accordance with the decision of the authorized body of the economic company on the following grounds:

own initiative;

demand of another governing body of the economic company;

demand of the inspection commission (inspector) of the economic company;

demand of the audit organization (or auditor - individual entrepreneur);

demand of participants (participant) of the economic company having, in total, not less than ten percent of votes from the total number of votes of participants of the economic company, unless otherwise established by part eleven of Article 571 and part three of Article 108 of this Law.

The authorized body of the economic company, within the time limit provided by the statute, but not later than fifteen days after the date of reception of the request for carrying out the extraordinary general meeting of participants of the economic company, should consider the request submitted, and make a decision on convocation and carrying out the meeting or reasoned decision on rejection of the request for convocation and holding thereof.

The decision on rejection of the request for convocation and carrying out the extraordinary general meeting of participants of the economic company is made in the following cases:

non-observance of the procedure of submission of the demand for carrying out the extraordinary general meeting of participants of the economic company, established by this Law and the statute;

if no matters proposed for inclusion in the agenda of extraordinary general meeting of participants of the economic company, are not included, in accordance with this Law and the statute, in the competence of the general meeting of participants of the economic company;

if all the matters proposed for consideration do not correspond to the requirements of this Law and/or other legislative acts.

The decision of the authorized body of the economic company on convocation and carrying out the extraordinary general meeting or reasoned decision on rejection of the request for convocation and carrying out the extraordinary general meeting is sent, in accordance with the procedure established by the statute of the economic company, to the persons requiring the convocation of the meeting, not later than five days after the date of making the decision.

Article 49. Convocation of the extraordinary general meeting of participants of the economic company

The authorized body of the economic company has not the right to change the form of carrying out the extraordinary general meeting of participants of the economic company, proposed by other governing body of the company, or by the inspection commission (inspector), or by the audit organization (auditor - individual entrepreneur), or by the participants (participant) having the right to demand holding the extraordinary general meeting.

The extraordinary general meeting of participants of the economic company should be carried out not later than forty days after the date of making the decision, by the authorized body of the economic company, on convocation and carrying out the meeting, with the exception of the cases when another time limit for holding the extraordinary general meeting of participants of the economic company is provided by part three of this Article or by the statute of the economic company.

The extraordinary general meeting of participants of the economic company, the agenda of which includes the matter of election of the members of the board of directors (supervisory board) by the cumulative voting, should be carried out within seventy days after the date of making the decision, by the authorized body of the economic company, on carrying out the meeting, unless a lesser time limit is provided by the statute.

If the decision on convocation and carrying out the extraordinary general meeting of participants of the economic company was not made by the authorized body of the economic company within the time limit established by the statute, or the decision was made on rejection of its convocation and holding, then the extraordinary general meeting of participants of the economic company may be convoked by the bodies or the participants (participant) of the economic company, having the right to demand holding an extraordinary general meeting. In such a case, the bodies and the participants convoking the extraordinary general meeting of participants of the economic company, have the powers of the authorized body of the economic company. The expenses for preparation, convocation and carrying out the extraordinary general meeting of participants of the economic company can be reimbursed, subject to the decision of that meeting, from the funds of the economic company. Upon a demand of bodies and participants convoking the extraordinary general meeting of participants of the economic company, that company is obliged to ensure a timely formation of the register of shareholders and its subsequent transmission to the mentioned persons. The extraordinary general meeting of participants of the economic company should be opened by the person specified by the bodies or participants of the economic company, requiring the holding of that meeting.

Article 50. Competence of the board of directors (supervisory board) of the economic company

The competence of the board of directors (supervisory board) of the economic company includes, in accordance with this Law and the statute of the economic company, the matters of the general management of the activities of the economic company, in particular:

determining the development strategy of the economic company;

approving the annual financial and economic plan of the economic company if preparation of such plan is provided by the statute, and the control over fulfilment thereof;

convoking the general meetings of participants of the economic company and deciding matter related to its preparation and holding;

making the decision on issuing the securities by the economic company, with the exception of making decisions on issuing shares;

approval of the decision on issuing of issuing securities, with the exception of making the decisions on share issuing;

making a decision on buy-out by the economic company of securities of that company, with the exception of making a decision on buy-out of shares;

approving the value of property of the economic company in the case of performing a major transaction and a transaction in which there is an interest of the affiliated persons, issuing (handing out) securities, and in other cases established by the legislation or the statute of the economic company when determination of the value of property of the economic company is necessary for performing a transaction with which a decision of the general meeting of participants of the board of directors (supervisory board) of the economic company is required;

using reserve and other funds of the economic company;

making a decision on major transactions or transactions in which there is an interest of affiliated persons, if making of decision on that matter is referred by the statute of the economic company, in accordance with part three of Article 57 and part three of Article 58 of this Law, to the competence of the board of directors (supervisory board) of the economic company;

selecting and approving an audit organisation (auditor – individual entrepreneur) and determining conditions of the contract of rendering auditing services with the audit organization (auditor – individual entrepreneur), with the exception of instances provided by part four of Article 86 and part two of Article 110 of this Law;

approving conditions of contracts with the managing organization (managing director) and with the appraiser;

approval of local normative acts of the economic company, in the cases provided by this Law;

deciding other matters provided by this Law, other legislative acts and the statute of the economic company.

The matters included in the exclusive competence of the general meeting of participants of the economic company may not be assigned to the competence of the board of directors (supervisory board) of the economic company.

Decisions of the general meetings of participants of the economic company may determine specific powers of the board of directors (supervisory board) of the economic company within its competence determined by the statute of the economic company.

Matters referred by part one of this Article to the competence of the board of directors (supervisory board) may be transferred by the statute of the economic company to the competence of the general meeting of participants of the economic company. In the instance when formation of the board of directors (supervisory board) in the economic company is not statute of the economic company, decision of the mentioned matters, unless otherwise established by legislative acts, is referred to the competence of the general meetings of participants of the economic company, with the exception of the matter on convocation of the general meeting of participants of the economic company and matters related to its preparation and holding for decision of which the statute must determine an authorized body of the economic company, and also of matters provided by indents five and six of part one of this Article which mat be transferred by the statute of the economic company for decision of its executive bodies.

Matters referred to the competence of the board of directors (supervisory board) of the economic company may not be transferred to decision of executive bodies of the economic company, unless otherwise established by parts one and two of Article 108 of this Law or the President of the Republic of Belarus.

Article 51. Board of directors (supervisory board) of the economic company

The board of directors (supervisory board) of the economic company is formed in the cases provided by this Law, other legislative acts and the statute of the economic company.

Only natural persons can be the members of the board of directors (supervisory board) of the economic company. The members of the board of directors (supervisory board) of the economic company may not be participant of that company.

The members of the collective executive body of the economic company can be the members of the board of directors (supervisory board) thereof; the number of such members should not exceed ј of the total number of the members of the board of directors (supervisory board), taking into consideration the limitation provided by part three of Article 54 of this Law. The statute of the economic company may provide for obligatory inclusion in its board of directors (supervisory board) of a representative of workers and/or trade union.

The persons elected as the members of the board of directors (supervisory board) of the economic company, can be re-elected, in accordance with the procedure established by this Law, without any limitations on the number of such re-elections.

The powers of a member (members) of the board of directors (supervisory board) of the economic company may be terminated before the appointed time, subject to the decision of the general meeting of participants of the economic company. In case of election of the members of the board of directors (supervisory board) of the economic company by cumulative voting, the decision on the termination of powers thereof before the appointed time can be made only in relation to all the members of that board. The powers of a member of the board of directors (supervisory board) of the economic company are terminated early without the decision of the general meeting of participants of the economic company in connection with discontinuation of membership of the member of the board of directors (supervisory board) in the event of submission of the application about the discontinuation of the membership, the death of the member of the board of directors (supervisory board), declaring him dead, recognizing him incapable or missing. In the event of discontinuation of membership of a member (members) of the board of directors (supervisory board), the board of directors (supervisory board) may continue to carry out its powers till the election of a new board of directors (supervisory board), with the exception of the case provided by part three of Article 52 of this Law,  and of the cases when in accordance with this Law and the statute of the economic company a unanimous decision of all members the board of directors (supervisory board) is required.

The members of the board of directors (supervisory board) elect the chairman for the arrangement of the activity thereof. The chairman arranges the work of the board of directors (supervisory board), convenes and conducts the sittings of the board of directors (supervisory board) and chairs them. The board of directors (supervisory board) has the right to re-elect the Chairman at any time, by the majority of the votes from the total number of members of that board, unless a greater number of votes is provided by the statute.

The Chairman of the board of directors (supervisory board) or another authorized member of the board of directors (supervisory board), in the case of forming of the collective executive body in the economic company in accordance with the statute, is entitled to attend its sittings and submit proposal on considered matters without the right to vote when taking decision on those matters.

For the members of the board of directors (supervisory board) of the economic company, the fees are paid and/or the charges are refunded during fulfilment of their duties, if it is provided by the statute and/or established by the general meeting, in the amounts established by the general meeting of the economic company.

The rights and duties of the members of the board of directors (supervisory board) and the Chairman of the Board are defined by this Law, other legislation and the statute.

The qualifying, professional and other requirements for the candidate members of the board of directors (supervisory board), and the procedure of making the decisions by the board of directors (supervisory board) in the part not regulated by the statute, may be specified by the appropriate local normative legal act of the economic company, approved by the general meeting of participants of the economic company.

Article 52. Meeting of the board of directors (supervisory board) of the economic company

The meeting of the board of directors (supervisory board) of the economic company is considered competent, if at least half of elected members thereof are present. The statute of the economic company may specify a greater number of present members of the board of directors (supervisory board) as necessary for the competence of the meeting.

The decisions of the board of directors (supervisory board) of the economic company are made at the meetings thereof by the majority of the votes from the number of the members of the board of directors (supervisory board) which are present at the meeting, unless a greater number of votes is specified by this Law and/or by the statute as necessary for adoption of its decisions. At making the decision by the board of directors (supervisory board), each member thereof has one vote, unless otherwise provided by the statute. In case of equal number of votes of the members of the board of directors (supervisory board) at making the decision by the Board, the Chairman has the right of a casting vote, unless otherwise provided by the statute. The decisions of the board of directors (supervisory board) of the economic company are registered in the report of proceedings which is subject to signing by the Chairman of the Board.

If the number of the members of the board of directors (supervisory board) of the economic company is turned out to be less than half of the number of elected members thereof or less than the number determined by the statute in accordance with part one of this Article for authority of a meeting of the board of directors (supervisory board) and also less than the number provided by part two of Article 84 of this Law, the board of directors (supervisory board) is obliged, within fifteen days, to adopt a decision on holding the extraordinary general meeting of participants of the economic company for by-election or election of a new membership of the board of directors (supervisory board) of that company. The remaining members of the board of directors (supervisory board) of the economic company are entitled to adopt a decision only on convocation of that extraordinary general meeting.

The transfer of powers, including the right to vote, by a member of the board of directors (supervisory board) of the economic company to another person, including another member of the board of directors (supervisory board) of the economic company, is not allowed.

The decisions of the board of directors (supervisory board) of the economic company can be made by interrogation of the members thereof, if it is provided by the statute.

Article 53. Competence of the executive body of the economic company

The competence of the executive body of the economic company includes making the decisions on all the matters which are not included in the competence of other governing bodies of that company, defined by this Law and/or the statute of the economic company.

The competence of an executive body of the economic company includes routine management of the activity thereof.

The one-man executive body of the economic company or the person which heads the collective executive body within the limits of his competence act on behalf of that company without power of attorney: Represent its interest (including in the governing bodies of other legal persons in which the economic company participate), conclude transactions on behalf of the economic company, etc.

The executive body of the economic company is accountable to the general meeting of participants of the economic company and the board of directors (supervisory board), if the formation thereof is provided by this Law, other legislative acts and the statute and shall organize fulfilment of decisions those bodies.

The powers of the one-person executive body and of the members of the collective executive body of the economic company, in accordance with the statute, can be terminated before the appointed time by the resolution of the general meeting of participants of the economic company or of the board of directors (supervisory board).

If the executive bodies of the economic company are formed by the general meeting of participants of the company, the statute of the company can provide the right of the board of directors (supervisory board) for making the decision on suspending the powers of the one-person executive body of the economic company and on transferring those powers to another person for the period up to formation of the new one-person executive body of the economic company.

At the same time, the board of directors (supervisory board) must make a decision on carrying out the extraordinary general meeting of participants of the economic company for making the decision on the matter of termination of the powers of the one-person executive body and on formation of the new one-person executive body of the economic company.

The decisions on suspending the powers of the one-person executive body of the economic company and transferring those powers, and on carrying out the extraordinary general meeting of participants of the economic company, are approved by the majority of at least ѕ of the votes of the members of the board of directors (supervisory board) of the economic company.

The powers of the executive body of the economic company can be transferred, by the decision of the general meeting of participants of the economic company, to other profit-making organization (the managing organization) or the individual entrepreneur (managing director), subject to the agreement.

Article 54. Executive body of the economic company

The person exercising powers of the one-person executive body of the economic company, members of the collective executive body of the economic company, including the person heading the collective executive body, are elected by the general meeting of participants of the economic company or by the board of directors (supervisory board), in accordance with the statute of the economic company.

The person exercising powers of the one-person executive body of the economic company, and also members of the collective executive body of the economic company, may be elected and from among  non-participants of the economic company.

The person exercising powers of the one-person executive body of the economic company, or the person heading the collective executive body of the economic company, is not entitled to be a member of the board of directors (supervisory board). those persons have the right to present on the meetings of the board of directors (supervisory board) and to make proposals on the matters under consideration, without the right to vote at making the decision on those matters.

In case of formation, in accordance with the statute, of the one-person and collective executive bodies in the economic company, the person exercising powers of the one-person executive body of that company, also shall exercise powers of the person heading the collective executive body of the economic company.

The rights and duties of the one-person executive body and the members of the collective executive body of the economic company are determined by this Law, labour legislation and the statute, and also by labour agreements (contracts) and/or civil-law contracts concluded by each of those persons with the economic company. On behalf of the economic company, the labour agreement (contract), civil-law contract is signed by the Chairman of the general meeting of participants of the economic company, on which those persons were elected, or by other natural person (participant), authorized by the decision of that meeting, or, in case of formation of the board of directors (supervisory board) in the economic company, by the Chairman of the board of directors (supervisory board) of the economic company or by other member authorized by the Board. The statute of the economic company may provide that labour agreements (contracts), civil-law contracts with members of the collective executive body of the economic company is signed on behalf of the economic company by the person exercising powers of the one-person executive body of the economic company in agreement with the board of directors (supervisory board).

Holding positions in the governing bodies of other organizations by the person exercising powers of the one-person executive body of the economic company or members of the collective executive body of the economic company is allowed in the order established by the statute, or subject to the consent of the general meeting of participants of the economic company, unless otherwise provided by the legislative acts.

The qualifying, professional and other requirements for the candidate members of the executive body of the economic company, and the procedure of making the decisions by that body in the part not regulated by the statute, may be specified by the appropriate local normative act of the economic company, approved by the general meeting of participants of the economic company, or by the board of directors (supervisory board) of the economic company.

Article 55. Procedure of making the decisions by the executive body of the economic company

The one-person executive body of the economic company or the person heading the collective executive body of the economic company issue orders (executive orders) and give instructions.

The decisions of the collective executive body of the economic company are made on the meetings thereof and are registered in the report of proceedings. The reports of proceedings of the meeting of the collective executive body of the economic company are signed by the person heading that body, and submitted to the general meeting of participants of the economic company, the board of directors (supervisory board), the inspection commission (inspector), subject to the request thereof.

The decisions of the executive body of the economic company are mandatory for all the employees of the company.

The quorum for carrying out the meeting of the collective executive body of the economic company is determined by the statute of the company and should be at least half from the total number of the members of the executive body.

The transfer of his powers, including the right to vote, by a member of the collective executive body of the economic company to other persons, including other members of the collective executive body, is not allowed.

CHAPTER 5
AFFILIATED PERSONS AND TRANSACTIONS OF THE ECONOMIC COMPANY

Article 56. Affiliated persons of the economic company

The affiliated persons of the economic company, natural persons and legal persons  capable to determine, directly and/or indirectly (through other natural persons and/or legal persons), the decisions made by the economic company or to influence the adoption thereof by the economic company and also legal persons the adoption of decisions by which is influenced by the economic company are:

members of the board of directors (supervisory board), the collective executive body, a natural or legal person exercising the powers of the one-person executive body of that economic company;

a legal person being a participant of the holding of which that company makes a part;

a natural person who solely or jointly with his espouse, parents, children and their spouses, step parents and their spouses, persons being under tutorship (guardianship), grandparents, grandchildren and their spouses, brothers and sisters and parents of the spouse possess or has the rights to dispose of a stake in the statutory fund (shares) of the economic company in the amount of 20 percent and more;

a legal person that possesses or has the right to dispose of a stake in the statutory fund of the economic company (shares) in the amount of twenty percent and more or has a possibility to determine decisions adopted by such company in accordance with a contract;

a legal person in the statutory fund of which, the economic company  possesses or has the right to dispose of a stake in the statutory fund (shares) in the amount of twenty percent and more or have a possibility to determine decisions adopted by such legal person in accordance with a contract;

the unitary enterprises founded by the economic company;

spouse, parents (tutors, guardians), children adult, emancipated or married before the age of 18 years (hereinafter – adult) and their spouses, adoptive parents, adult adopted children and their spouses, grandparents, adult grandchildren and their spouses, brothers and sisters and parents of the spouse of the natural person being in accordance with indents two, four, nine and ten of this part an affiliated person of the economic company, with the exception of the natural person being a member of the collective executive governing body or carrying out powers of the one-person executive body of the legal person mentioned in indent three of this part;

members of the collective governing bodies of the legal person being the affiliated person of the economic company, or the natural person or legal person exercising the powers of the one-person executive body of that legal person.

legal and natural persons in management of which shares of open joint-stock companies created in the process of denationalization and privatization of objects being in the republican or communal ownership have been transferred;

representatives of the state in governing bodies of economic companies stakes in statutory funds (shares) of which belong to the Republic of Belarus or to its administrative and territorial units.

The Republic of Belarus and its administrative and territorial units, the National Bank of the Republic of Belarus, republican bodies of state administration, other state organizations subordinated to the Government of the Republic of Belarus, local executive and administrative bodies are not recognized the affiliated persons of the economic company.

The economic company determines the circle of the affiliated persons thereof, and, in accordance with the procedure established by the company, notifies in writing thereon and keeps the records of such persons. The economic company has the right to request the information necessary for determination of the circle of the affiliated persons from the persons specified in part two of this Article.

Members of the board of directors (supervisory board), the collective executive body, a natural or legal person exercising the powers of the one-person executive body of that economic company, and also the natural person indicated in indents four, ten of part one of this Article are obliged, under the procedure established by that company, to bring to knowledge of the general meeting of its participants and/or the board of directors (supervisory board) the information:

about legal persons in statutory funds of which they solely or jointly with spouse, parents, children and their spouses, step parents and their spouses, persons being under tutorship (guardianship), grandparents, grandchildren and their spouses, brothers and sisters and parents of the spouse possess or has the rights to dispose of a stake in the statutory fund (shares) in the amount of 20 percent and more;

about legal persons the owners of which are they or their spouse, parents (tutors, guardians), children and their spouses, step parents, step children and their spouses, persons being under tutorship (guardianship), grandparents, grandchildren and their spouses, brothers and sisters and parents of the spouse;

about legal persons in the governing bodies of which they or their spouse, parents (tutors, guardians), children and their spouses, step parents, step children and their spouses, persons being under tutorship (guardianship), grandparents, grandchildren and their spouses, brothers and sisters and parents of the spouse hold offices.

The natural persons being, in accordance with indent four of part one of this Article, the affiliated persons of the economic company, have the right to authorize one of them, in accordance with the procedure established by that company, to submit the information, specified in part four of this Article, to the general meeting of participants of the economic company and/or the board of directors (supervisory board).

Legal persons specified in indents five and ten of part one of this Article, are obliged, in accordance with the procedure established by the economic company, to bring to knowledge of the general meeting of participants of the economic company and/or the board of directors (supervisory board) the information:

about legal persons, in the statutory fund of which, they solely or jointly with the affiliated person(s) of the economic company as a result of the agreed actions, including a contract concluded, have the right to dispose of a stake in the statutory fund (shares) in the amount of twenty percent or more;

about legal person the owners of property of which they are.

Members of the board of directors (supervisory board), of the collective executive body of that company, a natural person specified in indents four, ten of part one of this Article, and also legal persons specified in indents five and ten of this Article, are obliged, immediately from the moment when they become aware of a respective information, to bring to knowledge of the general meeting of participants of the economic company and/or of the board of directors (supervisory board) of that company the information about  performed or suggested transactions known to  them, in relation to which they can be recognized as interested persons, by means and in the form determined by the economic company.

Members of governing bodies of the economic company are obliged, upon submission of the information in accordance with part seven of this Article, to indicate data about all essential facts concerning the nature and the level of existing interest in performance of the transaction, and also about suggested gain of the mentioned persons as a result of performance of such a transaction.

The affiliated person of the economic company should notify the company, in accordance with the procedure established by the company, on purchase of a stake in the statutory fund (shares) of that company not later than ten days after the date of purchase.

Article 57. Interest of affiliated persons in performance of an transaction by the economic company

The interest of the affiliated persons in carrying out the transaction by the economic company is recognized, if those persons:

are the party of the transaction or act in the interests of third parties in the relations of those parties with the economic company;

possess (everyone or together) twenty or more percent of stakes in the statutory fund (shares) of the legal person which is the party of the transaction or acting in the interests of third parties in the relations of those parties with the economic company;

are owners of the property of a legal person being the party of the transaction or acting in the interests of third parties in relations of those parties with the economic company

are members of governing bodies, hold positions in the governing bodies of the legal person, which is the party to the transaction or acts in the interests of third persons in their relationships with the economic company;

in other instances determined by the statute.

The decision of the general meeting of participants of the economic company on the transaction, in carrying out of which there is an interest of its affiliated persons, is made by the general meeting of participants of the economic company by the majority from the total number of votes of participants of the economic company, not interested in carrying out the transaction.

The statute of the economic company may assign to the competence of the board of directors (supervisory board) to take decision on the transaction in making of which there is an interest of the affiliated persons, in the event when the value of the property being the object of the transaction of several interrelated transactions does not exceed two percent of the balance value of the assets of the economic company determined on the basis of accounting (financial) data for the last reporting period (value of the assets of the economic company determined on the first day of the month in which the transactions is being made, on the basis of the data of its inventory book of incomes and expenses (hereinafter – the value of assets), unless a higher percentage established by the statute. The statute or the decision of the general meeting of participants of the company may be determined that for the purposes of assigning transactions in conclusion of which there is an interest of affiliated persons to the competence of the  board of directors (supervisory board) the value of property being the object of the transaction or several interrelated transactions must be compared with the value of assets of the economic company determined on the basis of an independent assessment on the firs day of the month in which the transaction is being concluded. The decision on the transaction in conclusion of which there is an interest of the affiliated persons is to be taken by the majority of all members of the board of directors (supervisory board) non interested in conclusion of that transaction – independent directors. The member of the board of directors (supervisory board) of the economic company is considered as the independent director, if, without taking that status into consideration, that person is not the affiliate of that company, in accordance with this Law. If the number of the independent directors in the board of directors (supervisory board) is less than a quorum specified by the statute for holding the meeting of the board of directors (supervisory board), the decision about such a transaction shall be made by the general meeting of participants of the economic company.

are considered :

transactions with uniform obligations concluded with participation of the same persons within the time period determined by the statute;

several transactions with property which may be used as a whole for a common purpose (single property complex, complex things, etc.);

other transactions recognized as interconnected transactions by the statute of the economic company.

Decision of the general meeting of participants of the economic company (board of directors (supervisory board)) on the transaction in making of which there is an interest of the affiliated persons is not required in the event when all participants of the economic company are being affiliated persons of that company and, in accordance with part one of this Law, are interested in conclusion of such transaction. Decision of the general meeting of participants of the economic company (board of directors (supervisory board)) on the transaction in making of which there is an interest of the affiliated persons is also not required in the event when the transaction meets simultaneously the following conditions:

the transaction is made by the economic company in the process of its carrying out common economic activity;

the conditions of such transactions do not considerably differ from the conditions of analogous transactions made by the economic company in the process of its carrying out common economic activity.

As transactions being performed by the economic company in the process of its carrying out common economic activity are recognized transactions being performed three and more times in the course of the last twelve months by the economic company, in particular transactions on purchasing by the economic company of raw materials and materials, necessary for productive and economic activity, realization of finished products, execution  of works (provision of services).

The economic company is obliged to disclose for public knowledge through publication in printed mass media determined by the statute of the economic company and/or placement on the site of the economic company in the global computer network Internet, within a possibly shortest time limit necessary for making the said actions from the day of taking the respective decision, the information about transactions in making of which there as an interest of:

members of the board of directors (supervisory board), members of the collective executive body, a natural person exercising the powers of the one-person executive body of that economic company;

spouse, parents, adult children and their spouses, adoptive parents, adult adopted children and their spouses, grandparents, adult grandchildren and their spouses, brothers and sisters and parents of the spouse of the members of the board of directors (supervisory board), members of the collective executive body, a natural person exercising the powers of the one-person executive body of that economic company;

members of the collective governing bodies of the legal person exercising the powers of the one-person executive body of the economic company, the natural or legal person exercising the powers of the one-person executive body of that legal person.

It is to be discovered for general knowledge the information on the parties to a transaction, its object, criteria of the interest, in accordance with part one of this Article, of the persons specified in indents two to four of part seven of this Article, including about all essential facts concerning the nature and level of the interest, and also about suggested gain of the mentioned persons as a result of performance of such an transaction and other information provided by the statute of the economic company, with the exception of the instances when in accordance with the legislation the dissemination and/or provision of such information is restricted

The economic company is obliged, at the request of any participant, to submit the information determined by part eight of this Article about transactions in performance of which there is an interest of its affiliated persons.

When the economic company makes a transaction in making of which there is an interest of the affiliated persons, they are obliged to act in the interests of the company and demonstrate due caution and good faith as if they would demonstrate them if the company made an analogous transaction in making of which there was no their interest.

Provisions of this Article do not apply to the economic company consisting of one participant which simultaneously exercises powers of the one-person executive body of that company.

Article 571. Consequences of performing by the economic company of a transaction in performance of which there is an interest of its affiliated persons

A transaction in performance of which there is an interest of affiliated persons of the economic company, performed with violation of requirements provided by this Law and/or violating rights and legitimate interests of the economic company, members of that company shall be contestable and may be recognized invalid by the court upon an action of members of the economic company, of the economic company itself, and also of member of the board of directors (supervisory board), collective executive body.

A transaction in performance of which there is an interest of its affiliated persons of the economic company, performed with violation of requirements provided by this Law may not be recognized invalid upon availability of one of the following circumstances:

voting of participants of the economic company, of the members of the  which applied with the action on recognizing such a transaction invalid, could not influence the results of the voting if such participants (members of the board of directors (supervisory board)) were duly notified about the holding of the general meetings of participants of the economic company (meeting of the board of directors (supervisory board)) at which the decision on performance of such a transaction was adopted;

it was not proved that performance of such an transaction entailed or can entail infliction of damages on the economic company or participants of that company which applied with the action or occurrence of other non-favourable consequences for them;

by the moment of consideration of the case in the court, evidence was presented about the subsequent adoption by the general meeting of participants of the economic company, board of directors (supervisory board) of a decision on such a transaction in the order provided the by this Law for adoption of a decision on performance of transactions in performance of which there are an interest of affiliated persons.

In the event of infliction of damages to the economic company as a result of performance by the economic company of a transaction in performance of which there is an interest of its affiliated person, such a person shall bear liability before the economic company in the amount of damages inflicted if that affiliated person  proposed the transaction for conclusion knowingly not in the interests of that company and/or did not take measures on preventing its conclusion. In that instance if the affiliated person is interested in performance of the transaction received, as a consequence of its performance, incomes, the economic company is entitled to demand reimbursement of lost profit, along with other damages, in the amount of not less than the incomes received by that person. In the event when several affiliated persons of the economic company are liable, their liability before the economic company is joint and several.

Members of the the board of directors (supervisory board) of the economic company, which adopted the decision about the transaction in performance of which there is an interest of its affiliated persons, as a result of performance of which damages are inflicted on the economic company shall bear the liability before that company in the amount of  the loss incurred by the latter, jointly and severally with the mentioned affiliated persons. From the reimbursement of the mentioned loss shall be exempted a member (members) of the board of directors (supervisory board) not interested in such a transaction, including the one who voted for adoption of the decision (who adopted the decision) about that transaction in the instance if it will be proved that he (they) acted properly with observance of the requirements to the activity of members of governing bodies of the economic company established by part six of Article 33 of this Law.

A member of the the board of directors (supervisory board) of the economic company who did not take part, in accordance with part three of Article57 of this Law, in the adoption of the decision (did not adopt the decision) about the transaction in performance of which there is his interest, in the event of infliction of damages on that company as a result of the performance thereof, shall bear the liability before the economic company in the amount of damaged incurred by the latter if that member of the board of directors (supervisory board), acting unfairly, proposed for conclusion a transaction that is knowingly not in the interests of that company and/or did not take measure on preventing the conclusion thereof. In the event if as a consequence of performance of the mentioned transaction, that member of the board of directors (supervisory board) received incomes, he is obliged to reimburse to the economic company lost profit in the amount of not less than received incomes.

Adoption by the general meeting of participants of the economic company of a decision about the transaction in performance of which there is interest of its affiliated persons as a result of performance of which damages have been inflicted on the economic company does not exempt the affiliated persons from the liability for inflicted damages.

In the event of inflicting damages to the economic company as a result of performance of a transaction in performance of which there is interest of its affiliated persons, a member of the board of directors (supervisory board) who voted against the adoption of the decision about such a transaction, or a person exercising the powers of the one-person executive body of the economic company, or the chairperson of the collective executive body or another member thereof, or a participant (participants) of of the economic company must apply in writing to the chairperson of the board of directors (supervisory board) with a demand on initiating the issue about reimbursement by the persons determined by parts three  – five of this Article of damages inflicted on that company.

The chairperson of the board of directors (supervisory board) is obliged, on the basis of a demand received in accordance with part seven of this Article within the time limit of not more than five calendar days from day of its receipt or on own initiative, to convoke a meeting of the board of directors (supervisory board) for deciding the issue about reimbursement of damages inflicted on the economic company.

A decision of the board of directors (supervisory board) on the issue determined by parts seven and eight of this Article shall be brought to knowledge of the persons who applied in writing to the chairperson of the board of directors (supervisory board) with a demand on initiating the issue about reimbursement of damages inflicted on the economic company  within three calendar days from the day of holding the meeting of the board of directors (supervisory board).

In the event if the chairperson of the board of directors (supervisory board) did not take measures on convocation of the meeting of the board of directors (supervisory board) or the persons who applied in writing to the chairperson of the board of directors (supervisory board) with a demand on initiating the issue about reimbursement of damages inflicted on the economic company did not received, within the time limit established by part nine of this Article, a decision of the board of directors (supervisory board) on the issue of reimbursement of the mentioned damaged or the board of directors (supervisory board) adopted a decision not to present demand on reimbursement of the mentioned damages to the persons determined by parts three – five of this Article or those persons refused to reimburse the damages voluntarily, they may be collected in the interests of that company through court proceedings on an action of the economic company itself, of member of the board of directors (supervisory board) not interested in the transaction, authorized by its decision adopted by a majority of not less than two thirds of votes of members of the board of directors (supervisory board) not interested in the transaction, or of the participant (participants) of the economic company.

In the event if the formation of the board of directors (supervisory board) of the economic company is not provided for, the person exercising the powers of the one-person executive body of the economic company, or the chairperson of the collective executive body or another member thereof, or a participant (participants) of of the economic company, not interested in the mentioned transaction, are entitled to demand the holding of an extraordinary general meeting of participants of the economic company for adopting a decision on reimbursement by the persons determined by part three of this Article of damages inflicted on the economic company as a result of performance of a transaction in performance of which there is interest of its affiliated persons. In the event if the authorized body of the economic company did not take, within a time limit of not more than five calendar days from the day of receipt of the demand about convocation of the general meeting of participants of the economic company, a decision about its convocation and holding or the general meeting of participants of the economic company did not a decision on presenting to the persons determined part three of this Article of a demand on reimbursement of the mentioned damages, such damages may be collected in the interests of that company through court proceedings on an action of the economic company itself, or of chairperson of the collective executive body or another member thereof, or of a participant (participants) of the economic company, not interested in the transaction.

Article 58. Major transactions of the economic company

The major transaction of the economic company is a transaction (including loan, credit, pledge, surety) or several interrelated transactions  entailing purchase, alienation or a possibility of alienation of the property by the economic company, directly or indirectly, of monetary means and/or other property the value of which is twenty percent or more of the book value of assets of that company, determined on the basis of data of the accounting (financial) statements for the last reporting period preceding the date of adoption of the decision on performance of such a transaction (value of assets). The statute of the economic company may determine and other transactions the process of taking decisions for making of which is covered by the procedure of taking decisions concerning the making of a major transaction. In the event of purchasing of the property of the economic company, being the object of a major transaction, the sum of transactions shall be compared with the book value of assets (value of assets), in the event of alienation or possibility of alienation of the property being the object of a major transaction:

the value of such property determined on the basis of data of accounting (financial) statements (of the inventory book of incomes and expenses) if the mentioned value is equal to or exceeds the sum of the transaction;

the sum of the transaction if the value of the property determined on the basis of data of accounting (financial) statements (of the inventory book of incomes and expenses) is less the sum of the transaction.

The statute may determine that for the purposes of assigning the transaction to major transactions the value of assets of the economic company must be determined on the basis of an independent assessment on the firs day of the month in which the transaction is being made. In that instance the sum of transaction must be compares with the value of assets determined on the basis of an independent assessment.

Major transactions of the economic company may be carried out in accordance with the decision of the general meeting of participants, unless adoption of such decision is referred, in accordance with the statute, to the competence of the board of directors (supervisory board) of that company or unless otherwise established by the President of the Republic of Belarus.

In the decision on carrying out the major transaction of the economic company, other persons being the parties of the transaction, the object of the transaction, its sum (the total sum of interrelated transactions), conditions of the transaction which are determined by the legislation as essential for transactions of that kind and other conditions of the transaction on the decision of the governing body of the economic company which takes decision on making the major transaction should be specified.

If, in accordance with the statute, the decision on carrying out the major transaction is included in the competence of the board of directors (supervisory board) of the economic company, that decision must be made by all members of the board unanimously. If the unanimous decision is not made by the board of directors (supervisory board) of the economic company, the decision on carrying out the major transaction is made by the general meeting of participants of that company.

The general meeting of participants of the economic company makes a decision on carrying out the major transaction, the object of which is the property of the following cost:

from twenty to fifty percent of a book value of assets of the economic company, by the majority comprising not less than two thirds of the total number of votes of participants of the economic company, which took part in the general meeting, unless a major number is provided by the statute of the economic company;

fifty percent and more of a book value of assets of the economic company, by the majority comprising not less than three fourths of the total number of votes of participants of the economic company, which took part in the general meeting, unless a major number is provided by the statute of the economic company.

Introduction of changes into the condition of a major transaction is carried out on the decision of the governing body of the economic company which took decision on making the major transaction. The general meeting of participants of the economic company, simultaneously with taking the decision on making a major transaction, may take decision on transfer of powers for introduction of changes into its conditions, with the exception of changing other persons being its parties and the object of the transaction, to the board of directors (supervisory board) of the economic company. In that instance the decision on introduction of changes into the conditions of the major transaction shall be taken by the board of directors (supervisory board) of the economic company in the order provided by part five of this Article.

The provisions of this Article do not apply to the transactions being made by the economic company in the process of common economic activity, with the exception of the case provided by part nine of this Article.

In the instance when a major transaction is also a transaction in making of which there is interest of the affiliated persons of the economic company, the decision on such transaction is to be taken under the procedure established by parts two – six of Article 57 of this Law, with the exception of the case when in making such transaction all participants of the economic company are interested. When in making a major transaction in accordance with part one of Article 57 of this Law all participants of the economic company are interested, the decision on making such transaction is to be made under the procedure established by this Article.

A major transaction performed in violation of requirements provided by this Law is voidable and may be recognized by the court invalid upon a claim of participants of the economic company, the economic company itself, and also of member of the board of directors (supervisory board), collective executive body.

A major transaction performed in violation of requirements provided by this Law may not be recognized invalid upon availability of one of the following circumstances:

voting of participants of the economic company, of the members of the the board of directors (supervisory board) which applied with the action on recognizing a major transaction invalid, could not influence the results of the voting if such participants (members of the board of directors (supervisory board)) were duly notified about the holding of the general meetings of participants of the economic company (meeting of the board of directors (supervisory board)) at which the decision on performance of the major transaction was adopted;

it was not proved that performance of the given transaction entailed or can entail infliction of damages on the economic company or participants of that company which applied with the action or occurrence of other non-favourable consequences for them;

by the moment of consideration of the case in the court, evidence was presented about the subsequent adoption by the economic company of a decision about the major transaction in the order provided by this Law for adoption of a decision on performance of major transactions therewith.

Provisions of this Article do not apply to the economic company consisting of one participant which simultaneously exercises powers of the one-person executive body.

CHAPTER 6
CONTRO OVER FINANCIAL AND ECONOMIC ACTIVITIES OF THE ECONOMIC COMPANY

Article 59. Inspection commission (inspector) of the economic company

For implementation of the internal supervision over financial and economic activities, the general meeting of participants of the economic company elects the inspector or the inspection commission, if election of such commission is provided by this Law and/or by the statute of the economic company.

The competence of the inspection commission (inspector) of the economic company includes carrying out the inspections on all or several directions of activity of the company, or carrying out the check-ups in one or several interrelated directions or for the certain period of that activity, carried out by the economic company or by the affiliates and representative offices thereof.

A member of the board of directors (supervisory board) or of the collective executive body of the economic company or the natural person exercising the powers of the one-person executive body of the that company, may not be member of the inspection commission (inspector) of the economic company The persons, the activity of which is subject to checking, have not the right to participate in carrying out of the inspections or check-ups on the appropriate matters.

The inspection commission of the economic company is headed by the chairman, elected from the members thereof at the day of the termination of holding the general meeting of participants of the company at the first meeting of the inspection commission; that meeting of the inspection commission is organized carried out by the chairman of the general meeting of participants of the company. The chairperson shall organize the work of the inspection commission, including convoke and hold the meetings of the inspection commission and chair them, head inspections check-ups, ensure drawing-up of a con on results of a held inspection or check-up.

The powers of any member of the inspection commission (inspector) can be terminated before the appointed time, by the decision of the general meeting of participants of the economic company.

For the members of the inspection commission (inspector) of the economic company, the fees are paid, and/or the charges, related to fulfilling of their duties, are refunded during the period of fulfilment of their duties, subject to the decision of the general meeting of participants of the company, in the amounts determined by the latter.

Carrying out the following inspections and check-ups is mandatory for the inspection commission (inspector) of the economic company:

annual inspection, carried out on the basis of the results of financial and economic activities for the accounting year, in the terms established by the statute in accordance with the legislation;

inspections or check-ups, carried out in accordance with the decision of the governing bodies of the economic company, in the terms established by the governing bodies;

inspections or check-ups, carried out in accordance with the request of participants of the economic company in the cases provided by this Law, in the terms established by the statute.

The inspection commission (inspector) of the economic company has the right to carry out the inspections or check-up at the own initiative at any time. The time of carrying out the inspection or check-up should not exceed thirty days, unless otherwise established by the statute.

On the request of the inspection commission (inspector) of the economic company, the members of governing bodies of that company and the employees having, in accordance with the powers, labour relations or relations concerning the labour relations thereof, the right for making the decisions, should submit, within the terms specified, the documents concerning the financial and economic activities, necessary for carrying out the inspection or check-up, and give comprehensive explanations in oral and/or in written form.

The number of members of the inspection commission of the economic company, the competence of the inspection commission (inspector) of the economic company concerning the matters not specified by this Law, are determined by the statute and/or the local normative legal act of the economic company, approved by the general meeting of participants of the economic company.

Article 60. Conclusion of the inspection commission (inspector) of the economic company

In accordance with the results of the inspection or check-up, the inspection commission (inspector) of the economic company draws up the conclusion which should contain:

confirmation of reliability of registration and accounting data on financial and economic activities and correct reflection of those data in the bookkeeping (financial) accounting (the inventory book of incomes and expenses) and other documents;

revealed facts of violations of the legislation, the statute and local normative legal acts of the economic company regulating the activity thereof, and proposals concerning prevention and elimination of similar violations;

recommendations on reimbursement of the damage caused.

The conclusion of the inspection commission (inspector) of the economic company should be signed by the members of the inspection commission (inspector), carried out the inspection or check-up. In case of disagreement with the conclusion of the inspection commission or with specific findings and proposals, any member of the inspection commission has the right to state the point of view on the disagreements arisen.

In case of revealing the violations, the inspection commission (inspector) of the economic company should:

submit the conclusion of the inspection or check-up or specific findings and proposals to the governing bodies of the economic company which, in accordance with the competence thereof, within two weeks, should take measures on elimination of the violations revealed;

to require convocation of an extraordinary general meeting of participants of the economic company, if the decision on the facts of violations, revealed during the inspection or check-up, can be made only by that meeting.

The conclusion of the inspection commission (inspector) of the economic company, drawn up in accordance with the results of carrying out the annual inspection, is submitted for consideration of the general meeting of participants of that company at the approval of the annual accounting (financial) statements(data of the inventory book of incomes and expenses), distribution of profit and losses of the economic company.

Article 61. Audit and permanent internal control in the economic company

For performance of audit of accounting (financial) statements, rendering of other audit services, including in relation to affiliates and representative offices of the economic company, the economic company is entitled, and in the instances and in the order established by this Law and other legislative acts is obliged, to engage an audit organisation (auditor – individual entrepreneur).

Rendering of audit services shall be carried out on the basis of the contract of rendering auditing services in the order established by legislation. The size and sources of payment for the auditing services in accordance with the agreement are determined, in accordance with the legislation, by the governing bodies of the company, duly authorized in accordance with the statute.

Governing bodies of the economic company are obliged, in accordance with their competence, to take timely measures on elimination of violations detected in the course of rendering audit services.

The audit report prepared according to the results of conducting the audit of annual accounting (financial) statements (data of the inventory book of incomes and expenses) of the economic company shall be submitted for consideration of the general meeting of participants of that company upon approval of the annual accounting (financial) statements (data of the inventory book of incomes and expenses), distribution of its profit and losses.

The economic company is obliged to publish the audit report prepared according to the results of conducting the audit of annual accounting (financial) statements (data of the inventory book of incomes and expenses) of the economic company in the instances and in the order established by the legislation. If after the publication of the audit report, controlling (supervisory) bodies or the audit organisation (auditor – individual entrepreneur) have detected violations which constitute a ground for introduction of changes in the accounting (financial) statements of the company and revision of the audit report, the audit organisation (auditor – individual entrepreneur) must draw up a new audit report in the order established by the legislation.

For conducting routine internal control over financial and economic activities of the economic company, in accordance with the statute of the company, the controlling and inspection service may be established the procedure of operation of which shall be determined by an appropriate local normative act of the economic company, approved by the general meeting of participants of the economic company.

CHAPTER 7
RECORD-KEEPING AND REPORTING, DOCUMENTS OF THE ECONOMIC COMPANY. INFORMATION ON THE ECONOMIC COMPANY

Article 62. Record-keeping and reporting in the economic company

In the economic company, in accordance with the legislation and according to the accounting policy formulated by the economic company, bookkeeping and other record-keeping concerning financial and economic activity (the inventory book of incomes and expenses), affiliates and representative offices thereof, is organized and carried out, bookkeeping (financial), statistical and other accounting is drawn up and submitted.

The economic company and executive bodies thereof are responsible, in accordance with the legislation and the statute, for the organization, condition and reliability of the record-keeping and accounting in the economic company, submission of bookkeeping (financial), statistical and other accounting, in due time, to the appropriate state bodies (organizations).

In the cases established by this Law and other legislative acts, reliability of the bookkeeping (financial) accounting (data of the inventory book of incomes and expenses) should be confirmed by the inspection commission (inspector) or by the internal or auditing organization (auditor -- individual entrepreneur).

In the instances and in the order, provided by legislative acts, the economic company is obliged to draw up consolidated accounting (financial) statements.

Article 63. Documents of the economic company

The documents of the economic company include:

report of proceedings of the constituent meeting (written decisions of the founder of the economic company being founded by one person on issues specified in part one of Article 12 and part one of Article 68 of this Law);

the statute of the economic company;

changes and additions made in the statute of the economic company, registered in accordance with the procedure established by the legislation;

the certificate on the state registration of the economic company;

documents confirming the ownership or other real rights to the property being on the balance sheet (accounted in the inventory book of incomes and expenses) of the economic company;

documents confirming rights to land plots;

reports of proceedings of general meetings of participants of the economic company (in the economic company consisting of one participant – written decisions of that participant), report of proceedings of the counting commission and reports of proceedings of sittings of other bodies of the economic company;

local normative legal acts of the economic company regulating the activity thereof;

regulations on affiliates and representative offices of the economic company;

statutes of the unitary enterprises founded by the economic company;

statutes of economic companies the sole participant of which is the given economic company;

Payment document or another documents confirming the making of the monetary contribution to the statutory fund of the economic company, and/or conclusion on the assessment of the value of a non-monetary contribution to the statutory fund of the economic company and report on that assessment, and/or an expert conclusion of  the authenticity of the assessment of the value of non-monetary contribution to the statutory fund of the economic company, and also other acts of assessment of the value of property, which are enclosed to the conclusion.

annual reports and documents of accounting and of  accounting (financial) statements (the inventory book of incomes and expenses);

statistical and other reports;

the conclusions of the inspection commission (inspector) of the economic company, the auditor reports, certificates (notes) of supervising bodies;

the documents confirming issue (handing-out) of securities of the economic company;

the documents containing the information, which is subject to publication or disclosing by another way in accordance with this Law and other legislation;

lists of affiliated persons of the economic company;

other documents provided by this Law, the statute and local normative legal acts of the economic company regulating the activity thereof, and documents, the availability of which is mandatory in accordance with the legislation.

The economic company, in accordance with the procedure established by the archive-keeping legislation, is obliged to keep the documents at the location of the executive body of the economic company or at another location specified by the legislative acts.

Article 64. Information on the economic company

The information on the economic company is submitted and disclosed by the economic company in accordance with the legislation in the cases established by this Law, other legislative acts and statute, and also on the request of the state bodies and other organizations in the cases established by the legislative acts.

The economic company also provides other information, containing in the documents thereof, for the participants of the economic company on the requests of those participants, in accordance with the procedure and within the scope determined by the statute, with the exception of the cases specified by the legislation.

The information on the economic company, with the exception of the cases specified by this Law, can be also disclosed by the economic company, in accordance with the statute thereof, for the potential investors and other interested persons within the scope necessary for making reasonable decision on participation in the company or carrying out other actions capable to influence on the results of activity of the company.

The persons specified in the second and third parts of this Article, can become acquainted with the information on the economic company directly in the company or obtain that information, within the terms specified, by means of mail service or other methods, ensuring the authenticity of the information and established by the statute or appropriate local normative legal acts of the economic company. For providing the information by the economic company in accordance with this part in the form of copies of documents, the payment can be levied; the size of that payment must not exceed the expenses for making those copies and their delivery.

The information on the economic company must be disclosed by that company in mass media in cases, within the scope and in accordance with the procedure, established by this Law and other legislative acts.

The responsibility for timeliness and reliability of the information provided and disclosed by the economic company in accordance with the legislation and the statute is rested on the appropriate employees of the company.

CHAPTER 8
JOINT-STOCK COMPANY

Article 65. Principal provisions on the joint-stock company

Joint-stock company is the economic company with the statutory fund divided into the certain number of shares.

The statutory fund of the joint-stock company is composed of nominal value of shares.

The statutory fund of the open joint-stock company and of the closed joint-stock company must not be less than the minimum size provided by the legislation.

In the case of decreasing the cost of net assets of the joint-stock company at the end of the second and every following financial year below the minimal size of the statutory fund established by the legislation, that joint-stock company is subject to liquidation in the order established by this Law and other legislation.

The provisions of Chapters one -seven of this Law are applied to the joint-stock companies unless otherwise established by this Chapter.

Article 66. Open and closed joint-stock companies

The joint-stock company can be open or closed.

A joint-stock company the shares of which may be placed and circulated among unlimited set of persons is an open joint-stock company. Such joint-stock company is entitled to conduct an open subscription to shares issued by it or an open sale of shares of an additional issue in the order and on conditions established by the legislation on securities, and also a closed placement of shares of an additional issue in the instance provided by part four of Article 76 of this Law and in other instances provided by legislative acts.

The number of shareholders of the open joint-stock company is not limited.

A joint-stock company the shares of which are placed and circulated only among shareholders of that company and/or a limited set of persons determined in accordance with part three of Article 76 of this Code is a closed joint stock company. Such joint-stock company is not entitled to conduct  an open subscription to shares issued by it or to otherwise offer those shares to a unlimited set of persons for purchase.

The number of participants of the closed joint-stock company must not exceed fifty. Otherwise, it is subject to reorganization within one year, and, after expiration of that term, it is subject to liquidation judicially, unless the number of participants would be reduced to the limit established by this part.

The name of joint-stock company must contain words "open joint-stock company" or "closed joint-stock company". The abbreviated name of joint-stock company must contain the abbreviation "OAO" (open joint-stock company) or "ZAO” (closed joint-stock company).

Article 67. Contract on creation of the joint-stock company

The founders of the joint-stock company conclude the contract on creating the joint-stock company. The contract on creating the joint-stock company is subject to application of general provisions of the civil law on contracts and other obligations, unless otherwise followed from the essence of the contract. The contract on creating the joint-stock company, in addition to the provisions specified in part two of Article 11 of this Law, determines the following:

the information on the founders of the joint-stock company;

categories of shares (simple (ordinary) and preference shares), subject to distribution among founders, nominal value of shares, number of shares of each category;

the procedure of placing of shares among the founders of the joint-stock company.

According to a decision of the founders other data not contradicting the legislation may be included in the contract on creating the joint-stock company.

The contract on creating the joint-stock company is considered as concluded from the date of its signing by all founders. In case of the unanimous decision of founders on concluding the contract on creating the joint-stock company, that contract is considered as concluded from the date of notarial certification.

The contract on creating the joint-stock company is not considered as the constituent document, and it is terminated since the date of performing the obligations under that contract by all founders.

In the period of validity of the contract on creating the joint-stock company until the date of the state registration of the joint-stock company, subject to the unanimous decision of the founders, the changes and additions, executed in the same form as the contract, may be made in the contract on creating the joint-stock company, unless it follows from that contract otherwise.

The contract on creating the joint-stock company is subject to submission in the state bodies and other organizations, and to third parties, in the cases established by the legislative acts, or in accordance with the decision of founders.

Article 68. Constituent meeting of the economic company

The competence of the constituent meeting of the joint-stock company, in addition to the matters specified in part one of Article 12 of this Law, covers the approval of the decision on issue of shares.

The decision on issue of shares is subject to unanimous approval by the founders of the joint-stock company.

Decisions on forming of governing bodies and supervising bodies of the joint-stock company and on election of the members thereof are made by the founders of the joint-stock company, by the majority comprising at least three quarters of votes from the total number of votes of the founders of the joint-stock company.

The number of votes belonging to the founders is determined proportionally to the number of shares which are subject to distribution among the founders.

Article 69. Statute of the joint-stock company

The statute of the joint-stock company is the constituent document of the joint-stock company and is to be approved by its founders.

The Statute of the joint-stock company, in addition to the data specified in part two of Article 14 of this Law, must contain the following data:

on the total number of shares, nominal value thereof, categories of shares issued by the joint-stock company, number of shares of each category;

on the fixed size of preference shares dividend (in value terms or in terms of percentage, in relation to the nominal value of shares) or on the procedure of determination of those dividends (in case of issue of preference shares);

on the fixed value of property (in value terms or in terms of percentage, in relation to the nominal value of shares), which is subject to transfer to the holder of the preference share in case of liquidation of the joint-stock company, or on the procedure of determination of that fixed value (in case of issue of preference shares);

on the priority of payment of dividends, for each type of preference shares, and on the priority of the distribution of property between the shareholders being the holders of those shares, in case of liquidation of the joint-stock company (in case of issue of preference shares of several types).

The statute of the joint-stock company must contain any other data which are mandatory for the statute in accordance with this Law.

Making changes and/or additions in the statute of the joint-stock company is carried out in accordance with the decision of the general meeting of shareholders.

Article 70. Shares of the joint-stock company

The share is a nominal equity security evidencing the contribution to the statutory fund of the joint-stock company, being issued for an undetermined period in non-documentary form and certifying a definite volume of rights of the holder, depending on its category (simple (ordinary) or preference), type (for a preference share). 

The joint-stock company is entitled to issue shares of two categories: simple (ordinary) shares and preference shares.

Each simple (ordinary) share certifies identical volume of rights of the shareholder.

In accordance with the statute of the joint-stock company, issue of preference shares of one or several types may be provided.

Each preference share of the same type certificates identical scope of rights of the shareholder. This scope of rights is determined by the statute of the joint-stock company, subject to the requirements of this Law.

Types of preference shares differ in the scope of rights certified by those shares, including the fixed size of the dividend, and/or priority of payment thereof, and/or the fixed value of the property which is subject to transfer in case of liquidation of the joint-stock company, and/or priority of distribution of that property.

The preference shares of all types should not exceed twenty five percent in the total amount of the statutory fund of the joint-stock company.

The general meeting of shareholders is entitled, if it is provided by the statute of the joint-stock company, to take decision on changing the number of shares without changing the amount of the statutory fund. Change of the number of shares without changing the amount of the statutory fund is carried out through exchange of two or more shares of the company for one new share of changed nominal value of the same category (type) (consolidation of shares) or exchange of one share of the company for two or more shares of changed nominal value of the same category (type) (splitting of shares). In doing so it is not allowed to change the number of shareholders and the ratio of their stakes, and the creation of parts of shares (fractional shares).

Simultaneously with the decision on consolidation or splitting of shares the general meeting of shareholders is obliged to take decision on introducing respective changes into the statute of the joint-stock company concerning the nominal value and the number of shares of the company of the respective category (type).

The restrictions of total nominal value or number of simple (ordinary) shares and/or preference shares, or of a stake of such shares in the total amount of the statutory fund of the joint-stock company, belonging to one shareholder, can be established by the legislative acts or by the statute of the joint-stock company.

Article 71. Rights and liability of shareholders

The shareholders holding the simple (ordinary) shares, have the right to:

obtaining of part of profit of the joint-stock company in the form of dividends;

obtaining, in case of liquidation of the joint-stock company, of part of the property which has remained after settlements with creditors, or of part of the value of that property;

participation in the general meeting of shareholders with a vote on the matters included in the competence of the general meeting of shareholders.

The shareholders, holding the preference shares, have the right to:

receive a part of profit of the joint-stock company in the form of dividends of fixed size within the time limit determined by the statute of the joint-stock company for paying-out dividends on preference shares;

obtaining, in case of liquidation of the joint-stock company, of part of the property which has remained after settlements with creditors, or of part of the value of that property;

participation in the general meeting of shareholders with a vote in the cases provided by parts  three and four of this Article.

The shareholders, holding the preference shares, have the right to participate in the general meeting of shareholders with a vote at making the decision on reorganization or liquidation of the joint-stock company, on making changes and/or additions in the statute of the joint-stock company, limiting the rights of those shareholders.

If the decision was made on the general meeting of shareholders on non-payment of dividend on the preference shares of the certain type, or on partial payment of dividend, or if the decision on dividend payment within the time limit determined by the statute was not adopted, the shareholders, holding the preference shares of such type, can participate in subsequent general meetings of shareholders, with a right to vote, from the date of adoption (non-adoption) of such decision till the date of payment of dividends on those shares in full.

The shareholders are not liable for the obligations of the joint-stock company; the shareholders bear the risk of the losses, related with activity of the company, within the limits of value of shares which belong to them.

The shareholders, who have not completely paid up the shares, are jointly and severally liable for the obligations of the joint-stock company within the limits of the unpaid part of value of shares belonging to them.

The joint-stock company is obliged to conclude a contract with the depositary on depositary service of the joint-stock company, in accordance with provisions of which the depositary, at the request of the joint-stock company, carries out the formation of the register of shareholders. The joint-stock company is obliged to take measures on ensuring the protection of data entered into the register of shareholders and is entitled to provide such data to state bodies, legal or natural persons in accordance with the legislative acts. Members of the board of directors (supervisory board) or of the collective executive body of the economic company, the person exercising the powers of the one-person executive board, members of the inspection commission (inspector), workers of the audit organisation and auditor – individual entrepreneur, rendering audit services to the economic company, other persons who have (had), ex officio or by virtue of an official position, labour relations or a civil-law contract, the access to the data entered into the register of shareholders are not entitled to transfer such data to third persons, with the exception of the cases stipulated by legislative acts, or use them otherwise for personal purposes. those persons bear responsibility for illegal use or dissemination of the said information in accordance with the legislative acts.

Article 72. Dividends of the joint-stock company

The joint-stock company is entitled to distribute among the shareholders holders of simple (ordinary) shares, and is obliged to distribute among shareholders – holders of preference shares, a part of profit remaining at its the disposal after payment of taxes and other obligatory payments and covering the losses of current periods, arisen through the fault of the joint-stock company, by means of payment of dividends, with the exception of cases established by part five of this Article. In the instances and in the order determined by legislative acts, the joint-stock company if obliged to pay dividends. Decisions on announcing and paying dividends for the first quarter, six months and nine months may be adopted by the economic company on the basis of the data of its interim accounting statements (financial) statements, and according to the results of the year – on the basis of the data of annual accounting statements (financial) statements

The joint-stock company has the right to allocate part of profit on forming the special fund for accumulation and payment of dividends on preference shares.

The procedure for announcement and payment of dividends on simple (ordinary) shares is determined by the statute of the joint-stock company, with the exception of the time limit for payment of dividends on simple (ordinary) shares, which may be determined by a decision of the general meeting of shareholders, adopted by the majority of not less than two thirds of votes of persons participating in that meeting. If the time limit for payment of dividends on simple (ordinary) shares is not determined by the statute of the joint-stock company or by the decision of the general meeting of shareholders, it should not exceed sixty days after the date of making the decision on the announcement and payment of dividends. If the time limit of payment of dividends on simple (ordinary) shares, determined by the statute of the joint-stock company is more than sixty days, in the event of early payment of dividends (in full or in part), the dividends are to be paid simultaneously to all shareholders holding simple (ordinary) shares in proportion to the number of shares belonging to them.

The list of shareholders, having the right for obtaining dividends, is determined on the basis of the same register of shareholders, on the basis of which the list of persons having the right on participation in the general meeting of the shareholders, which have made a decision on payment of corresponding dividends, was determined.

The joint-stock company has not the right to make the decision on the announcement and payment of dividends, and to pay dividends, if:

the statutory fund is not paid up completely;

value of net assets of the joint-stock company is or would be, as a result of payment of dividends, less than the amount of the statutory fund and the surplus funds;

the joint-stock company is or would be, as a result of payment of dividends, stably insolvent in accordance with the legislation on economic insolvency (bankruptcy);

buy-out of shares of the joint-stock company on request of shareholders thereof is not completed in accordance with Article 78 of this Law.

The procedure of the announcement and payment of dividends of the joint-stock company, at the extent not stipulated by the statute of the joint-stock company, can be also determined by the local normative legal act of the company, approved by the general meeting of shareholders.

Article 73. Circulation of shares of the closed joint-stock company

The shareholders of the closed joint-stock company have priority right on purchasing shares, sold by other shareholders of the company. If as a result of the realization by shareholders of the priority right, the shares cannot be purchased in the offered number the company itself is entitled to purchase the shares unclaimed by shareholders at the price agreed with their holder and/or to propose to a third person (hereinafter – the third person determined by the company) to purchase those shares at the price not lower than the price offered to the shareholders of the closed joint-stock company.

If the shares offered for realization cannot be purchased by shareholders and/or the company, and/or the third person determined by the company in full, an agreement may be reached with the shareholder about the partial sale of the shares offered for realization. The shares remaining after the partial sale may be sold by the shareholder to any third person at the price not lower than the price proposed to the shareholder of the closed joint-stock company.

When shareholders and the company did not give the consent to purchase shares being sold by another shareholder of the closed joint-stock company within the time limit established by the statute of the company, or they refused to purchase them, or the agreement on partial sale of shares offered for realization has not been reached, those shares may be sold by the shareholder to any third person at the price not lower than the price proposed to the shareholder of the closed joint-stock company.

The shareholder that intends to sell shares belonging to him is obliged, in the order provided by the statute of the company, to notify the company and other shareholders about his intention with indication of the price and other conditions of the sale of shares. The shareholder is entitled to instruct the company to notify other shareholders about his intention to sell shares belonging to him. In that instance the company is obliged to notify, in the order established by the statute of the company, other shareholders about the intention of the shareholder to sell share belonging to him within the time limit not later than five days from the day of receipt of notification of the shareholders about it. Unless otherwise provided by the statute of company, the notification of shareholders of the company is carried out at the cost of the shareholder that intends to sell his shares. When the company does not notify other shareholders about the intention of the shareholder to sell share belonging to him within the indicated term, such shareholder himself notifies other shareholders about his intention. In that event the notification of shareholders of the company is carried out at the expense of the closed joint-stock company.

When shareholders the closed joint-stock company realize the priority right to but shares offered for realization, the shares are purchase by shareholders proportionally to the number of shares belonging to each of them. When someone of shareholder refused to purchase shares, those share are purchased by remaining shareholders proportionally to the number of shares belonging to each of them.

The statute of the closed joint-stock company must determine the following matters:

the procedure of actions of the shareholder intending to sell shares belonging to him, including the method of notification of the company and other shareholders about the intention to sell the shares, and requirements to the information included in that notification (the price and other terms of sale);

the procedure of notification of other shareholders by the company about the intention of the shareholder to sell shares belonging to him, including the method of notification of shareholders by the company, and requirements to the information included in that notification (number of shares which each of shareholders may purchase as a result of realization of the priority right to purchase shares, price and other terms of sale);

the procedure and time limit of realization by shareholders of their priority right and the right of the  company to purchase of shares being sold by other shareholders of the closed joint-stock company;

the procedure and time limit for making proposal by the company to a third person determined by the company about the purchase, and also the time limit of purchase by that person of shares being sold by shareholders of the closed joint-stock company.

The statute of the closed joint-stock company may determine the procedure for realization of the priority right to purchase shares of the closed joint-stock company other than that provided by parts one – five of this Article, with the exception of rules concerning the necessity to notify other shareholders about the intention of the shareholder to sell share belonging to him, the priority of their purchase and requirement concerning the purchase of shares by third persons at the price not lower than the price proposed to the shareholder of the closed joint-stock company.

Concession of the priority right on purchasing shares, sold by other shareholders of the company, by the shareholders of the closed joint-stock company, is not allowed.

In case of purchasing shares with violation of the priority right of shareholders of the closed joint-stock company or the right of the company on purchasing shares, sold by other shareholders of that company, any shareholder of the company and/or the company has the right, within three months after the date when the shareholder or the company were informed or must have been informed on such violation, to require judicially to transfer the rights and duties of the purchaser to that shareholder or the company.

In case of pledge of shares of the closed joint-stock company and subsequent levy of execution on those shares by the pledgee, the rules established by parts one – five of this Article. However, the pledgee has the right to keep the shares, instead of alienation of the shares to a third party.

Shares of the closed joint-stock company are passed to the successors of the citizen or the assignees of the legal person, which was the shareholder, unless the statute of the company provides that such passing is permitted only subject to the consent of the company. The consent of the closed joint-stock company is considered obtained, if, within the time limit provided by the statute of the company, written consent of all the shareholders of the company is obtained, or no written refusal is obtained from any of the shareholders. In case of refusal in passing the shares of the closed joint-stock company to the successors (assignees), those shares must be purchased by other shareholders or by the company in accordance with the rules established by parts one – five of this Article. However, the successors (assignees) have the right to keep the shares, instead of alienation of the shares to a third party.

The statute of the closed joint-stock company can provide necessity of obtaining the consent of the company on alienation of shares to a third party by the way other than sale. The consent of the closed joint-stock company is considered obtained, if, within the time limit provided by the statute of the company, a written consent of all the shareholders of the company is obtained, or no written refusal is obtained from any of the shareholders.

Rules of part one – five and seven of this Article cover swap contracts which stipulate the transfer of shares of a closed joint-stock company, unless otherwise follows from the essence of the swap contract.

Donation by a shareholder of a closed joint-stock company of shares of that company may be carried out only to the Republic of Belarus (its administrative and territorial units) or to persons being parents, children, adoptive parents, adopted children, spouse, parents-in-law, brothers and sisters, grandparents in relation to the shareholder;

The statute of the economic company or a decision of the general meeting of shareholders, adopted by the majority of not less than three quarters of votes of persons who participated in that meeting, may restrict the circle of third persons to whom the shareholders of the given company may sell or alienate otherwise shares of that company.

The closed joint-stock company disposes of the shares purchased in accordance with this Article in the order established by part five and six of Article 77 of this Law for the shares purchased by the company by the decision of that company.

Provisions of this Article do not cover the acquisition by the closed joint-stock company of shares of that company according to a decision of the company itself in accordance with Article 77 of this Law, and also the buy-out of shares by the joint stock company at the request of its shareholders in accordance with Article 78 of this Law.

Article 74. Increase of the statutory fund of the joint-stock company

The or by increase of nominal value of shares. The increase of the statutory fund of the joint-stock company is permitted after paying up the statutory fund in full.

Increase of the statutory fund of the joint-stock company by issue of shares of an additional issue may be carried out both at the expense of own capital of that company and/or means of its shareholders and at the expense of other investments. Increase of the statutory fund of the joint-stock company by increase of nominal value of shares is carried out at the expense of own capital of that company,  and subject to a unanimous decision of the shareholders – at the expense of means of its shareholders.

The sum by which the statutory fund of the joint-stock company is increased at the expense of own capital should not exceed a difference between the value of net assets and the sum of the statutory fund and reserve funds of that company.

In case of increase of the statutory fund of the joint-stock company by issue of shares of an additional issue, the general meeting of shareholder shall approve the decision on issue thereof, containing the requisites and the data established by the legislation on securities.

In case of increase of the statutory fund of the joint-stock company by issue of shares of an additional issue at the expense of own capital of the joint-stock company, shares of that issue shall be placed, unless otherwise provided by the legislative acts, among all shareholders proportionally to the number of shares belonging to them of the same category and the same type.

In case of increase of the statutory fund of the joint-stock company by issue of shares of an additional issue, the statutory fund is increased by the sum of nominal values of the placed shares of an additional issue. In the shares of the additional issue are placed by subscription, the results of subscription are subject to approval by the general meeting of shareholders.

Article 75. Decrease of the statutory fund of the joint-stock company

Decrease of the statutory fund of the joint-stock company is carried out by reduction of the nominal value of shares or purchase of part of shares by the joint-stock company for the purpose of reduction of total number thereof.

The joint-stock company has not the right to make a decision on decreasing the statutory fund if, as a result of such decrease, the statutory fund of the joint-stock company would become less than the minimum amount of the statutory fund provided by the legislation.

Decrease of the statutory fund of the joint-stock company by purchase of part of shares by the company for the purpose of reduction of total number of shares is permitted, if such opportunity is provided by the statute of the joint-stock company, with the exception of the cases established by part eight of Article 77 of this Law.

In case of decreasing the statutory fund of the joint-stock company by purchase of part of shares by the company for the purpose of reduction of total number of shares, the statutory fund is decreased by the sum of nominal values of purchased shares.

Decrease of the statutory fund of the joint-stock company is subject to prior notification of all creditors of the company in accordance with the procedure established by part five of Article 28 of this Law.

Article 76. Placement of shares by the joint-stock company

At founding of the joint-stock company, all shares thereof must be allocated among the founders.

Placement of shares of an additional issue by the joint-stock company can be open or closed.

In case of open placement of shares of an additional issue by the joint-stock company, they shall be placed among an unlimited set of persons; in case of closed placement, shares shall be placed among shareholders, and in a closed joint-stock company – also among a limited set of persons determined by the statute of the closed joint-stock company; or if the statute of the closed joint-stock company does not determine the given set of persons among persons other than shareholders of that company, determined by a decision of the general meeting of shareholders of the closed joint-stock company adopted by a majority of not less than two thirds of the total number of votes of the shareholders of that company.

The open joint-stock company is entitled to conduct an open placement of share of an additional issue. In case of placement of shares of an additional issue at the expense of own capital of the open joint stock company and/or of means of its shareholders, that company is entitled to conduct a closed placement of shares of an additional issue.

The closed joint-stock company is entitled to conduct only a closed placement of shares of an additional issue.

The statute of the joint-stock company may provide for the priority right of the shareholders holding simple (ordinary) or other voting shares to purchase of shares of an additionally issue, unless otherwise provided by the legislative acts. In such a case, the statute of the joint-stock company must contain:

the procedure of determination of the number of shares which each shareholder has the right to purchase;

the procedure of notification of the shareholders about their priority right on purchasing shares, including the requirements for the information contained in such notification;

the time limit of validity of the priority right on purchasing shares;

the procedure for the shareholders wishing to implement the priority right on purchasing shares.

The order of exercising  by shareholders of the priority right to purchase of shares of an additional issue in the part not regulated by the statute of that company may be determined by a local normative act approved by the general meeting of shareholders.

Placement of shares an additional issue, irrespective of the sum of nominal values thereof or of the interest of affiliated persons in placement of such shares, is not considered as a major transaction or as a transaction in which there is an interest of affiliated persons.

Prior to the state registration of shares in the order established by the legislation on securities, the joint-stock company has no right to dispose of monetary means, to alienate other property received as payment of shares placed, and the investor has no right to alienate the shares paid by him.

Article 77. Purchasing of shares of the joint-stock company on the decision of the company itself

The decision on purchasing by the joint-stock company of shares of that company is taken by the general meeting of shareholders for the purposes of purchasing shares for:

subsequent sale or gratuitous transfer to the state;

subsequent proportional distribution among shareholders;

subsequent sale to the investor on conditions provided by the business plan of the company;

annulment, in the event of taking, in accordance with the statute of that company, the decision about decreasing the statutory fund of the joint-stock company through purchasing of a part of shares with a view of reducing their total number;

other instances provided for by the legislative acts.

The decision of the general meeting of shareholders on purchasing by the joint-stock company of shares of that company shall determine:

the purpose of purchasing shares;

categories of shares purchased, and for preference shares – types should also be specified;

number of purchased shares of each category and type, purchase price of shares, form and time limit of payment for shares;

the time limit for submitting offers on sale of shares by shareholders;

the time limit during which share purchase is carried out;

procedure of notification of shareholders holding the shares the decision on purchase of which was made.

Unless otherwise specified in the statute of the joint-stock company, payment for shares at purchase thereof by the decision of the joint-stock company is fulfilled by monetary means. The time limit during which the purchase of shares should be carried out, should never be less than thirty days and more than six months after making the decision on share purchase.

Each shareholder – holder of share of a determined category (for preference shares – and of their type) a decision about purchase of which is adopted is entitled to sell his shares, and the joint-stock company is obliged to acquire shares from the shareholders who submitted proposals about the sale of shares within the time limit established by the decision of the general meeting of shareholders about acquisition by the joint-stock company of share of that company. If the total number of shares, offered for purchasing, exceeds the number of shares, in relation to which the decision on purchase thereof is made by the joint-stock company; those shares are purchased from shareholders proportionally to the offers declared.

The shares acquired by the joint-stock company in accordance with the decision of the general meeting of shareholders on reduction of the statutory fund of the joint-stock company for the purpose of reduction of total number of shares, are subject to nullification in accordance with appropriate decision of the authorized state body on the basis of the documents submitted by the joint-stock company in accordance with the security legislation. The shares purchased in accordance with the decision of the joint-stock company in other cases, are assigned to the disposal of the company.

The shares assigned to the disposal of the joint-stock company do not grant a vote, those shares are not taken into consideration at counting of votes on the general meeting of shareholders; the dividends are not accrued on those shares, with the exception of the case specified in part seven of this Article. Such share must be realized in accordance with the purpose determined in the decision of the general meeting of shareholders within one year, unless otherwise established by the statute of the joint-stock company. Otherwise, the general meeting of shareholders must adopt a decision on decreasing the statutory fund of the joint-stock company by the sum of net values of the shares which were assigned to the disposal of the company.

Subject to the decision of the general meeting of shareholders, the opportunity of obtaining the dividends by the members of executive bodies of the company on the shares assigned to the disposal of the company can be provided, if such opportunity is stipulated by the statute of the joint-stock company.

The joint-stock company has not the right to make a decision on purchasing shares and to purchase shares under the following circumstances:

before complete paying up of the statutory fund;

if the joint-stock company is or would be, as a result of purchase of shares, stably insolvent in accordance with the legislation on economic insolvency (bankruptcy);

if, at the date of purchase of shares, the cost of net assets of the joint-stock company is or would be, as a result of purchase of shares, less than sum of the statutory fund and surplus funds;

if the sum of net values of the shares, being at the disposal of the joint-stock company, will comprise more than ten percent of the statutory fund of the company, except for a case of reduction of the statutory fund;

if the shareholder who presented a proposal on sale of shares of that joint-stock company is its sole participant;

before completion of buy-out of shares of the joint-stock company on the request of shareholders thereof, in accordance with Article 78 of this Law.

Transactions on acquisition by the joint stock company of shares of that company, performed without adoption of a respective decision of the general meeting of shareholders, are null and void.

Article 78. Buyout of shares of the joint-stock company at the request of its shareholders

The buyout of shares of the joint-stock company on the request of shareholders of that company is carried out in the following cases:

reorganization of the joint-stock company, if the shareholders requesting the buyout of their shares have voted against the decision on reorganization or were not notified properly about the holding of the general meeting of shareholders, at which the decision on reorganization was adopted;

making changes and/or additions in the statute concerning the rights of shareholders which entailed of limitation of those rights, if the shareholders requesting for buy-out of the shares have voted against the appropriate decision or did not participate in the general meeting of shareholders, on which the decision was made

performance of a major transaction of the joint-stock company, if the shareholders requesting the buyout of their shares have voted against the decision on performance of the major transaction or were not notified properly about the holding of the general meeting of shareholders, at which the decision on reorganization was adopted.

The list of shareholders, the shares of which should be redeemed by the joint-stock company on the request of shareholders, is drawn up on the basis of data of the same register of shareholders, on the basis of which the list of persons was draw up, having the right for participation in the general meeting of shareholders, the agenda of which included the issues, adoption of the decision on which can entail arising of the right of shareholders to request the buyout of shares of that company.

The price of buyout by the joint-stock company of shares of that company at the request of its shareholders is to be approved by the same general meeting of shareholders which adopts the decision which can entail arising of the right of shareholders to request the buyout of shares of that company.  In the event of performing an independent assessment of the value of shares, the price of the buyout of shares must be not less than the value of shares specified in the conclusion on assessment. The independent assessment of the value of shares must be held at the request of shareholders that hold in aggregate two percent and more of voting shares of the joint-stock company at the expense of means of that company or may be held on the initiative of the company itself or of any shareholder(s) at the expense of own means. The issue about the price of buyout by the joint stock company of shares of that company at the request of its shareholders must be included in the agenda in which an issue is included the adoption of a decision on which can entail arising of the right of shareholders to request the buyout of shares of that company.

Unless otherwise specified in the statute of the joint-stock company, payment for shares at buy-out thereof on the request of shareholders is fulfilled in monetary means.

The total amount of monetary means, allocated by the joint-stock company on buy-out of shares on the request of shareholders of that company, cannot exceed ten percent of value of net assets of the joint-stock company at the date of making the decision which entailed arising of the right of shareholders on the request for buy-out of shares of the joint-stock company by that company. If the total number of shares, offered for buy-out at the request of shareholders, exceeds the number of shares, which can be purchased by the joint-stock company, taking into consideration the limitation stipulated hereby, those shares are redeemed from shareholders proportionally to the offers declared.

The procedure of notification of shareholders about their right to require the buy-out of shares and the term, during which the joint-stock company should perform that notification, the procedure and the time limit of submission, by shareholders, of the applications with the request for buy-out of shares, the procedure and the time limit during which the company should satisfy the requests for buy-out of shares or to notify shareholders on refusal of such redemption, are determined by the statute of the joint-stock company.

The shares bought out by the joint-stock company in the instances provided by this Article shall be assigned at the disposal of the joint-stock company. The joint-stock company is entitled to dispose of such share in the order and on the terms established by parts one, five and six of Article 77 of this Law.

The shareholder who submitted the request for buyout of shares in accordance with this Article, in case of rejection of that request, has the right to contest the decision of the joint-stock company through court proceedings within six months from the day of notification about the rejection.

Shareholders of join stock companies created in the process of privatization of state property or by means of transformation of leaseholding enterprises, collective (people's), state enterprises, state unitary enterprises, more than fifty percent of shares of which belong to the state are not entitled to request the buyout of shares belonging to them in the event of reorganization thereof in the form of affiliation thereto of one or several legal persons, as well as the shareholder who is the sole participant of that joint-stock company.

Article 79. Competence of the general meeting of shareholders

The exclusive competence of the general meeting of shareholders, in addition to the matters referred by part one of Article 34 of this Law and by the statute of the joint-stock company to the exclusive competence of the general meeting of participants of the economic company, includes adoption and approval of the decision on issue of shares, adoption of decisions on acquisition (alienation) by the joint-stock company of shares of that company and on announcement and payment of dividends for the first quarter,  first six months and  nine months on the basis of the data of its interim accounting (financial) statements, and according to results of the year – on the basis of the data of annual accounting (financial) statements.

The competence of the general meeting of shareholders includes forming of executive bodies of the joint-stock company and termination of powers thereof before the appointed time, unless deciding those issues is referred by the statute of the joint-stock company to the competence of the board of directors (supervisory board).

Article 80. Proposals for the agenda of the general meeting of shareholders

The shareholders (shareholder) holding in total two and more percent of voting shares of the joint-stock company (if the lesser number of voting shares is not provided by the statute of the joint-stock company), can make proposals for the agenda of the general meeting of shareholders, on the candidate members of the board of directors (supervisory board) and on the candidate members of the inspection commission (candidate inspector), in accordance with the procedure established by the statute of the joint-stock company.

Article 81. List of persons having the right to participate in the general meeting of shareholders

The list of persons, having the right to participation in the general meeting of shareholders, shall be drawn up on the basis of data of the register of shareholders formed as of the date established by the authorized body of the economic company. The date of drawing up the register of shareholders, on the basis of which the list of persons, having the right for participation in the general meeting of shareholders, is drawn up, cannot be certain before the date of adoption of the decision on holding the general meeting of shareholders.

The list of persons, having the right for participation in the general meeting of shareholders, should contain a name of each such person, the data of identity documents or other data necessary for identification of the shareholder, the data on the number of shares belonging to the shareholder, the data on a category and type of shares, on which the shareholder has a vote, postal address for sending the notification on holding the general meeting of shareholders, the ballots for voting and the notification on the decisions made by the general meeting of shareholders.

At the request of the persons holding, in total, not less than one percent of voting shares, the list of persons, having the right on participation in the general meeting of shareholders, should be made available for persons who submitted the request. However, the data of the identity documents and postal addresses of natural persons included in that list are made available only subject to the written consent of those persons.

At the request of any person having the right for participation in the general meeting of shareholders, the joint-stock company should, within three days, issue an extract from the list of persons having the right on participation in the general meeting of the shareholders, containing the data acknowledging that that person is included in the before-mentioned list, or the note certifying that that person is not included in the before-mentioned list.

Changes in the list of persons, having the right for participation in the general meeting of shareholders, can be made only for the purposes of restoration of infringed rights of those persons who were included in the before-mentioned list at the date of drawing up thereof, or for the purposes of correction of errors made at drawing up that list. In case of transferring (assigning) the right to shares after the date of forming of the register of shareholders, on the basis of which the list of persons, having the right to participation in the general meeting of shareholders, was drawn up, but before the date of holding the general meeting of shareholders, such a person has the right to participate in the given general meeting of shareholders upon presentation of evidence confirming the transfer (assignment) of the right to shares. In the mentioned instances requirements of Article 39 of this Law on notification about the holding the general meeting of participants of the economic company are not applied. When the given person applies to the joint-stock company for information (documents) to be provided to shareholders in the course of preparation to the holding of the general meeting of the joint-stock company, and also for other information contained in the notification about the holding of the general meeting of shareholders, prior to holding thereof, the joint-stock company is obliged to provide the mentioned information (mentioned documents).

Article 82. Counting commission

The counting commission is formed in the joint-stock company the number of shareholder in which is more than one hundred. The number of members of the counting commission of the joint-stock company can not be less than three persons. Members of bodies of the economic company, including the representatives of the managing organization or the managing director, and the persons nominated as the candidates for the posts in those bodies, cannot be the members of the counting commission.

The counting commission confirms the availability of a quorum of the general meeting of shareholders, explains the questions arising in connection with implementation of the right to participation in the general meeting of shareholders by the persons having such right, explains a voting procedure concerning the matters presented for voting, provides observance of the established voting procedure and implementation of the voting rights, carries out counting of votes and sums up the results of voting, draws up and submits for keeping, in accordance with part two of Article 63 of this Law, the report of voting results and voting ballots.

Article 83. Order of voting and adoption of decisions at the general meeting of shareholders

Voting on the general meeting of shareholders is carried out in accordance with a principle "one voting share - one vote", with the exception of carrying out the cumulative voting.

The voting share of the joint-stock company is simple (ordinary) or preference share, granting the voting right for the shareholder (the holder of that share) at making the decision on the matter presented for voting, in the cases stipulated in this Law.

If the agenda of the general meeting of shareholders includes issues, voting on which is carried out by different groups of voting persons, the quorum for making the decision on those issues is determined separately. In such a case, absence of quorum for making the decision concerning the matters, voting on which is carried out by one group of voting persons, does not prevent making the decision on the matters, voting on which is carried out by other group of voting persons, if the quorum for the latter is available.

In the joint-stock company with the number of shareholder holding voting share of more than one hundred, the voting in the general meeting when taking decision on matters included in the agenda is carried out only by voting ballots.

The ballot for voting must contain:

wording of the issue or its sequential number in the agenda of the meeting;

options for voting on each issue , expressed by the words “for”, “against”, "abstain" or options for voting on each candidate to the bodies of the joint-stock company;

number of votes belonging to the shareholder.

The ballot for voting must be signed by the shareholder or the person having the right to participation in the general meeting of shareholders. At counting votes on ballots for voting, the votes on those issues on which the order of voting determined by the ballot has been observed by the voting person, and only one of possible options of voting has been marked, with the exception of the instance of cumulative voting. The ballot for voting shall be recognized invalid in the part of those issues on which the voting person has not observed the order of voting.

On the issue presented for voting, for which the shareholders of simple (ordinary) or preference shares have voting rights, the counting of votes on the general meeting of shareholders is carried out for all voting shares.

Decisions of the general meeting of shareholders concerning changes and/or additions in the statute of the joint-stock company, increase or reduction of the statutory fund of the joint-stock company, reorganization and liquidation of the company, purchasing of shares, placed by the joint-stock company, by that company in accordance with the decision of that company, are made by the majority composing not less than three quarters of votes of the persons participating in the meeting, with the exception of a case provided by part two of Article 74 of this Law, with the exception of cases when the greater number of votes is provided by the statute of the joint-stock company. At making the decision of the general meeting of shareholders on election of members of the inspection commission (inspector) of the joint-stock company, the persons holding the posts in the governing bodies of the joint-stock company do not participate in voting, subject to appropriate provision of the statute of the joint-stock company.

Article 84. Board of directors (supervisory board) of the joint-stock company

In the joint-stock company, forming of the board of directors (supervisory board) can be provided by the statute of that company; in the joint-stock company with number of shareholders exceeding fifty, forming of the board of directors (supervisory board) is mandatory.

In the joint-stock company with the number of shareholders of more than one thousand, the number of members of the board of directors (supervisory board) should not be less than seven persons; in the joint-stock company with number of shareholders more than ten thousand; that number should not be less than nine. In the joint-stock company with the number of shareholders of more than one hundred, election of members of the board of directors (supervisory board) shall be carried out by cumulative voting, unless otherwise established by the statute of the joint-stock company. In the joint-stock company with the number of shareholders of more than one thousand, election of members of the board of directors (supervisory board) shall be carried out by cumulative voting.

In the joint-stock company, the number of independent directors within the board of directors (supervisory board) can be specified by the statute of that company.

Members of the board of directors (supervisory board), members of the collective executive body, the person exercising the powers of the one-person executive body of the open joint-stock company are obliged to inform the board of directors (supervisory board) about all their transactions with securities of the company, as well as about transactions with securities of that company made by their spouse, parents, adult children and their spouses, adoptive parents, adult adopted children and their spouses, grandparents, adult grandchildren and their spouses, brothers and sisters and parents of the spouse in the order provided by the statute of the company.

Article 85. Competence of the board of directors (supervisory board) of the economic company

The competence of the board of directors (supervisory board) of the joint-stock company in addition to issues referred by part one of Article 50 this Law shall include:

determination of the recommended size of dividends and terms of payment thereof;

approval of the depository and terms and conditions of the depository contract with the issuer having regard to regard to the requirements established by the legislation.

In the instance if the formation of the board of directors (supervisory board) in the joint-stock company  is not provided for, the issues referred by part one of this Article to the competence of the board of directors (supervisory board) of the joint-stock company are referred, unless otherwise established by the President of the Republic of Belarus, to the competence of the general meeting of shareholders.

Article 86. Specific features of control over financial and economic activities of the joint-stock company

For carrying out the internal supervision over financial and economic activities, the open joint-stock company should form the inspection commission in accordance with the procedure established by Article 59 of this Law.

At the written request of the shareholders, holding (in total) ten or more percent of shares, submitted to the inspection commission (inspector) and/or to the governing bodies of the joint-stock company determined by the statute of the joint-stock company, the inspection or check-up of financial and economic activities of the joint-stock company should be carried out at any time in accordance with the procedure provided by Article 59 of this Law. In that case, the inspection or check-up must begin not later than thirty days after the date of obtaining the request of shareholders for carrying out the inspection or check-up, unless otherwise established by the statute of the joint-stock company.

The joint-stock company obliged in accordance with Article 88 of this Law to disclose the information about the joint-stock company must annually engage  an audit organisation (auditor - individual entrepreneur) in accordance with Article 61 of this Law for conducting the audit of annual (financial) statements.

Audit of annual (financial) statements (data of the inventory book of incomes and expenses) of the joint-stock company, including the one not obliged to disclose the information about the joint-stock company, must be conducted at the expense of means of the joint-stock company at any time at the request of shareholders being, in aggregate, holders of ten percent of shares and more of that company.  In the instance if the governing body of the joint-stock company authorised by the statute has not taken measures on conducting the audit at the request of shareholders being, in aggregate, holders of ten percent of shares and more of that company, the mentioned shareholders are entitled to act as ordering customers of the audit. In that instance selection of the audit organisation (auditor – individual entrepreneur) and conclusion of the contract of rendering audit services are carried out by those shareholders themselves with the right to collect expenses for conducting the audit from the joint-stock company. In that instance the joint-stock company of obliged to create conditions for timely and quality conducting of the audit for the audit organisation (auditor-individual entrepreneur), including to provide all necessary documents.

If the governing body of the joint-stock company authorized by the statute evades from conduction the audit at the request of shareholders being, in aggregate, holders of ten percent of shares and more of that company or does not create proper conditions for its conducting, the audit may be conducted on the basis of a court decision on an action of shareholders demanding its conducting.

Article 87. Documents of the joint-stock company

The documents of the joint-stock company, in addition to the documents specified in part one of Article 63 of this Law, include:

contract on creating the joint-stock company (written decisions of the sole founder of the joint-stock company);

lists of persons having the right for participation in the general meeting of shareholders;

power of attorney (a copy of the power of attorney) to participate in the general meeting of shareholders;

voting ballots;

voting ballots; lists of persons having the right for dividends;

other lists of shareholders drawn up for providing of implementation of their rights;

registers of shareholders, on the basis of which the lists of persons, specified in this Article, have been drawn up.

Article 88. Specific features of disclosing of the information on the joint-stock company

The joint-stock company is obliged to disclose the information on the joint-stock company in the volume and the order determined by the legislation on securities.

The closed joint-stock company can, in in the instances established by the legislation is obliged to, disclose the information on the joint-stock company in the volume and the order determined by the legislation on securities.

The joint-stock company consisting of one shareholder must disclosed the information thereon for public knowledge through publication thereof in print mass media determined by the statute of the joint-stock and/or placement on the site of that company in the global computer network Internet.

Article 89. Reorganization and liquidation of the joint-stock company

Reorganization or liquidation of the joint-stock company can be carried out in accordance with the decision of the general meeting of shareholders of that company, and also on other grounds in accordance with the procedure specified by this Law and other legislative acts.

In case of reorganization of the joint-stock company in the form of merging or splitting-up, the issue of shares of reorganized joint-stock company shall be annulled in accordance with the legislation on securities.

In case of reorganization of the joint-stock company in the form of affiliation, the issue shares of the joint-stock company being affiliated shall be annulled in accordance with the legislation on securities.

In case of reorganization of the joint-stock company in the form of splitting-off, a part of the issue of shares of joint-stock company being reorganized corresponding to the value of decrease of its statutory fund shall be annulled in accordance with the legislation on securities.

The joint-stock company is entitled to be reorganized in a limited liability company, additional liability company, economic partnership, production co-operative or unitary enterprise. In case of reorganization of the joint-stock company in the form of transformation to the joint-stock company of other kind or to other form of the profit-making organization, the issue of shares of joint-stock company being reorganized shall be annulled in accordance with the legislation on securities.

Article 90. Distribution of property of joint-stock company being liquidated among shareholders

The property of liquidated joint-stock company which remained after settlements with the creditors in accordance with the legislative acts, is distributed by the liquidation commission (the liquidator) between shareholders in accordance with the following priorities:

first, payments are carried out for shares subject to buy-out by the joint-stock company at the price approved by the general meeting of shareholders in accordance with part three of Article 78 of this Law;

second, payments of accrued but non-paid dividends on the preference shares of appropriate types are carried out;

third, payment of fixed value of the property, specified in the statute of the joint-stock company or in accordance with the procedure established by the statute, to the holders of preference shares of all types, or transfer of part of the property, corresponding to that value, to the before-mentioned shareholders is carried out;

fourth, distribution of property of liquidated joint-stock company between shareholders, holders the simple (ordinary) shares, is carried out.

Article 901. Shareholder agreement

The shareholder agreement is recognized a contract on exercising the right certified by shares and/or on specific features of exercising right to shares.

Parties to a shareholder agreement are shareholder of the joint-stock company which undertake to exercise in a determined manner rights certified by shares and/or rights to shares and/or abstain from exercising the mentioned rights. The shareholder agreement may stipulate a duty of parties thereto to vote in a certain manner at the general meeting of shareholders, to agree an option of voting with other shareholders, to acquire or to alienate shares at a price determined in advance and/or upon occurrence of certain circumstances, to abstain from alienation of share prior to occurrence of  certain circumstances, and also to carry out in an agreed manner other actions related to managing the joint stock company, activities, reorganization and liquidation of that company.

The subject matter of the shareholder agreement may not be commitments of the parties to the shareholder agreement of vote according to indications of governing bodies bodies of the joint-stock company in relation to which the given shareholder agreement has been concluded.

The shareholder agreement shall be concluded in writing by means of drawing out one document signed by the parties. The shareholder agreement must be concluded in relation to all shares belonging to a party to the shareholder agreement. Parties to a shareholder agreement may not be all shareholders simultaneously.

The shareholder agreement is binding only for parties thereto. A violation of the shareholder agreement may not be a ground for recognition as invalid of decisions of the governing bodies of the joint-stock company.

The shareholder agreement may stipulated methods for ensuring the fulfilment of obligations arising out of the shareholder agreement and measures of civil-law liability for non-fulfilment or improper fulfilment of such obligations.

Not later than three days prior to holding the general meeting of shareholders, the parties are obliged to notify the joint-stock company about their concluding a shareholder agreement (introduction of changes and/or additions therein). In the instance if the shareholder agreement is concluded within the time limit of less than three days prior to the date of holding the general meeting, the joint-stock company must be notified thereabout on the day of conclusion of the shareholder agreement, but prior to holding the general meeting of shareholders.

The joint-stock company must, in the order provided by its statute or a local normative legal act, disclose to other shareholders the information about conclusion of the shareholder agreement, including the data about the parties to the shareholder agreement and the number of shares belonging to them not later than three days prior to holding the general meeting of shareholders. In the instance if the shareholder agreement is concluded within the time limit of less than three days prior to the date of holding the general meeting of shareholders, the information provided by this part about conclusion of the shareholder agreement must be disclosed immediately before the beginning of holding the general meeting of shareholders.

The joint-stock company may disclose the information about conclusion of the shareholder agreement for public knowledge through  publication thereof in printed mass media determined by the statute of the joint-stock company and/or placement on the site of that company in the global computer network Internet in the order and the volume determined by the statute or a local normative legal act of such a company.

Disputes arising out of the shareholder agreement shall be settled through court proceedings.

CHAPTER 9
LIMITED LIABILITY COMPANY

Article 91. Principal provisions on the limited liability company

The limited liability company is the economic company with number of participants not exceeding fifty, and with the statutory fund divided into the stakes, sizes of which are specified by the statute.

The statutory fund of the limited liability company is composed of values of contributions of the participants thereof. The limited liability company determines independently the amount of its statutory funds.

The limited liability company is not entitled to issue shares.

The name of the limited liability company should contain words "limited liability company". The abbreviated name of the limited liability company should contain the abbreviation "OOO" (limited liability company).

The provisions of Chapters one - seven of this Law are applied to the limited liability companies, unless otherwise provided by this Chapter.

Article 92. Statute of the limited liability company

The statute of the limited liability company is the constituent document of the company.

The statute of the limited liability company, in addition to the data specified in part two of Article 14 of this Law must contain the following data:

list of participants of the limited liability company and data on the size of stakes of each of participants in the statutory fund of the limited liability company;

amount and composition of contributions of participants of the limited liability company to its statutory fund;

indication to the body of the limited liability company the competence of which includes the matters of creation and liquidation of representative offices and affiliates of the company;

procedure of withdrawal of the participant of the limited liability company from that company, and the procedure of expulsion thereof;

procedure of transferring of the stake (part of stake) in the statutory fund of the limited liability company to other person;

other data if those data should be included in the statute in accordance with this Law.

Article 93. Contributions to the statutory fund of the limited liability company

Founders (participants) make their contributions to the statutory fund of the limited liability company in accordance with this Law, other legislative acts and the statute of the company.

If a participant of the limited liability company make a contribution to the statutory fund of that company in the form of the right to use property for a certain period, then in case of withdrawal (expulsion) of that participant from the given company such property remains in the use of the limited liability company for the period for which the property was transferred, unless otherwise provided by the statute of that company or by a decision of the general meeting of its participants, adopted unanimously, without regard  to the votes belonging to the withdrawing participant (being expelled).

Article 94. Stakes of participants in the statutory fund of the limited liability company

The size of participant’s stake of the limited liability company in the statutory fund of that company is determined in percentage or in the form of fraction and corresponds to the ratio between the value of the participant’s contribution to the statutory fund and the size of the statutory fund of that company, unless otherwise provided by the statute of the company.

The actual value of the stake of the participant of the limited liability company corresponds to the part of value of net assets of the company, proportional to the size of the participant’s stake.

The maximum size of the participant’s stake or an opportunity of change of ratio of stakes of the participants of the company can be limited by the statute of the limited liability company. These limitations can be established at founding of the limited liability company or later, subject to unanimously approved decision of the general meeting of participants of the company; that decision can be changed or cancelled in accordance with the same procedure.

Article 95. Liability of participants of the limited liability company

The participants of the limited liability company are not liable for the obligations of the limited liability company; the participants bear the risk of the losses, related with activity of the company, within the limits of value of the contributions made by them to the statutory fund of the company.

The participants of the limited liability company, who have not made their contributions in full, are jointly and severally liable for the obligations of the limited liability company within the limits of the unpaid part of the contribution of each participant of the company.

Article 96. Distribution of profit of the limited liability company among its participants

With the exception of the cases stipulated in this Article, the part of profit of the limited liability company, remaining in the disposal of the company after tax payment, other mandatory payments, covering the losses of the current periods arisen through the fault of the company, and deductions in the funds of the company, can be distributed between the participants of the company proportionally to the sizes of their shares in the statutory fund of the company, unless otherwise established by the statute of the limited liability company.

The decisions on making changes in the statute of the limited liability company, concerning the procedure of distribution of profit between the participants of the company, are approved unanimously by all participants of the company.

The limited liability company has not the right to make the decision on the distribution of profit between the participants of the company and on appropriate payments, or pay the profit, in the following cases:

the statutory fund is not paid up completely;

the actual value of the stake (part of stake) of the participant of the company is not paid up completely, in the cases specified by this Law;

the limited liability company is or would be, as a result of payment of the profit, stably insolvent in accordance with the legislation on economic insolvency (bankruptcy);

at the date of making the decision on payment of the profit, or at the date of payment, the value of net assets of the company is or would be, as a result of payment of the profit, less then the amount of the statutory fund and the surplus funds.

In case of termination of the circumstances specified in part three of this Article, the limited liability company should pay to the participants part of profit, in relation to which the decision on distribution between the participants and on payment was made.

Article 97. Alienation by the participant of the limited liability company of his stake (part of the stake) in the statutory fund of the company

The participant of the limited liability company has the right to sell or otherwise alienate the stake (part of stake) in the statutory fund of the company to one or several participants of that company or to the company itself. Alienation by the sole participant of the limited liability company of his stake in the statutory fund of the company to the company itself is not allowed.

Alienation of the stake (part of stake) in the statutory fund of the company to third parties is permitted, unless otherwise provided by the statute of the company.

The stake of the participant in the statutory fund of the limited liability company may not be till it is paid up in full only in that part which is already paid up.

Article 98. Priority right to purchase the stake (part of the stake) being alienated of the participant in the statutory fund of the limited liability company

The participants of the limited liability company have the priority right on purchasing the stake (part of stake) of the participant in the statutory fund of the company, proportionally to the sizes of the interests thereof in the statutory fund of the company, unless the statute or the decision of the general meeting of participants of the economic company, approved unanimously, provides of another order of exercising that right or unless otherwise established by the President of the Republic of Belarus.

The procedure of implementation of the priority right on purchasing the stake (part of stake) of the participant in the statutory fund of the limited liability company out of proportion to the sizes of the interests of the participants in the statutory fund can be provided by the statute at founding of the company or included in the statute, changed or excluded from the statute by the decision of the general meeting of participants of the economic company, which should be approved unanimously.

The procedure of actions of the participant of the limited liability company, intending to sell the stake (part of stake) in the statutory fund of the company, is determined by the statute and should provide the form, the method of notification of other participants of the company and of the company itself about the intention to sell the stake (part of stake), and requirements to the information included in that notification (the price and other terms of sale).

The procedure for realization by participants of the limited liability company of the priority right to purchase the stake (part of the stake) of the participant in the statutory fund of the company shall be determined by the statute of the company and must  contain the time limit, but not more than thirty days from the day of sending by the participant intending to sell his stake (part of the stake) of the notification about the sale thereof, priority and sequence of actions, in accordance with which the participants of that company can take advantage of their priority right to purchase the stake (part of the stake ) of the participant in the statutory fund of the company.

Concession, by the participants of the limited liability company, of the priority right on purchasing the stake (part of stake) in the statutory fund of the company, stipulated by the statute of the company or by the decision of the general meeting, is prohibited.

If, in accordance with the statute of the limited liability company, the alienation of the stake (part of stake) of the participant in the statutory fund of the company for third parties is impossible, and other participants of that company refuse to purchase the stake (part of stake), the company should pay the actual value thereof to the participant, or, subject to the consent of the participant, to deliver the property in kind to the participant, corresponding to before-mentioned value. The actual value of the stake (part of stake) of the participant in the statutory fund of the company is determined on the basis of data of the accounting balance sheet for the last reporting period preceding the date of application of the participant with such request (data of the inventory book of incomes and expenses on the first day of the month of application of the participant). In that instance the stake (part of the stake) of the participant in the statutory fund of that company is transferred to the company itself from the moment of payment to the participant of the actual value of the stake (part of the stake) or of handing him property in kind corresponding to such value.

In case of sale of the stake (part of stake) of the participant in the statutory fund of the limited liability company with violation of the priority right on purchasing the stake (part of stake), any participant of the company and/or the company itself has the right, within three months after the date when the participant or the company were informed or should be informed on such violation, to require judicially to transfer the rights and duties of the purchaser to that participant or the company.

Article 99. Transferring the stake (part of the stake ) of the participant in the statutory fund of the limited liability company to the company itself

In the instance if the participants of the limited liability company would not take advantage of their priority right to purchase the stake (part of the stake) of the participant in the statutory fund of the limited liability company within the time limit provided by the statute of the company, the stake (part of the stake) of the participant in the statutory fund of the company may be alienated to the company itself.

The stake of the participant in the statutory fund of the limited liability company shall be transferred to that company if the participant has not made his contribution to the statutory fund of the company within the time limit determined by the decision on founding the company or made only a part of the contribution. In that instance the stake of the participant in the statutory fund of the limited liability company shall be transferred to the company itself from the day of expiration of the time limit for making the contribution.

In the instance if  the participant of the limited liability company has made only a part of the contribution, the company is obliged to pay him the actual value of the part of his stake in the statutory fund of the company, proportional to the part of contribution made by the participant (to the period during which the property was in the use of the company), or, subject to the consent of the participant of the company, to hand out to him the property in kind corresponding to such value. The actual value of that part of participant’s stake in the statutory fund of the company shall be determined on the basis of data of the accounting balance sheet of the company for the last reporting period preceding the date of expiration of the time limit for making the contribution (data of the inventory book of incomes and expenses on the first day of the month of expiration of the time limit for making the contribution).

The actual value of the stake (part of the stake) of the participant in the statutory fund of the limited liability company shall be paid at the expense of a difference between the value of net assets of that company and its statutory fund within the time limit determined by a decision of the general meeting of participants of the limited liability company adopted unanimously without regard to the vote of the participant who made only a part of the stake, but not longer than twelve months from the day of expiration of the time limit from making the contribution.. If that difference is insufficient, the limited liability company should decrease the statutory fund by the amount of insufficiency.

The statute of the limited liability company or the decision of the general meeting of participants of the company, approved unanimously without taking into consideration the vote of the participant which has made only part of the contribution, can provide transferring to the company in relation to the part of the participant’s stake in the statutory fund of the company, proportional to the part of the contribution not made by that participant.

Transferring of the participant’s stake in the statutory fund of the limited liability company can be also carried out in other cases provided by this Law.

The votes which are related to the stake in the statutory fund, belonging to the limited liability company, are not taken into consideration at determination of the results of voting on the general meeting of participants of the company. In case of liquidation of the limited liability company, the profit and property of the company are not distributed on the stake in the statutory fund, belonging to the company.

In case of sale of the stake (part of stake) of the participant in the statutory fund of the limited liability company with violation of the company right on purchasing the stake (part of stake), the company has the right, within three months after the date when the company was informed or should be informed on such violation, to require judicially to transfer the rights and duties of the purchaser to the company.

Article 100. Consequences of purchase by the limited liability company of stakes (parts of stakes) of participants in the statutory fund of  the company

The limited liability company within one year after the date of purchasing the stakes (part of stakes) of participants in the statutory fund should distribute those stakes (part of stakes) between all participants of the company proportionally to the sizes of the stakes thereof in the statutory fund, or to sell those stakes (part of stakes) in accordance with he procedure of implementation of the priority right of purchasing the stakes in the statutory fund of the limited liability company, established by Article 98 of this Law.

In case of refusal of participants to purchase the stake in the statutory fund of the limited liability company, purchased by the company, that stake can be alienated to third parties, if the alienation of the stake to third parties is allowed in accordance with the statute of the limited liability company.

Sale of the share in the statutory fund of the limited liability company, purchased by the company, to the participants of that company, resulting in change of the sizes of stakes of other participants in the statutory fund of the company, sale of before-mentioned stakes to third parties, and making changes in the statute of the limited liability company in connection with sale of those stakes, are carried out by the decision of the general meeting of participants of the company, which should be approved unanimously.

If after the expiration of the time limit specified in part one of this Article, the stake (part of stake) in the statutory fund of the limited liability company, purchased by the company, remained undistributed or unsold, the limited liability company should reduce the statutory fund by the size of value of that stake (part of stake).

Article 101. Transfer of the stake (part of the stake ) of the participant in the statutory fund of the limited liability company to a third person

In the instance if shareholders of the limited liability company have not taken advantage of the priority right on purchasing the stake (part of stake) of the participant in the statutory fund of the company, and the company itself has not taken advantage of the priority right on purchasing the stake (part of stake) of the participant in the statutory fund of the company, then the stake (part of stake) of the participant in the statutory fund of the company can be alienated to a third party, unless otherwise provided by the statute.

It is considered that participants of the limited liability company and the company itself have not taken advantage, accordingly, of the priority right and the right to purchase the stake (part of the stake ) of a participant in the statutory fund of the company, if no consent to purchase the stake (part of the stake) was received from the participants and from the company or refusal to purchase the stake (part of the stake) was received In that case, alienation of the stake (part of the stake) of the participant in the statutory fund of the limited liability company to third parties is carried out at the price and subject to conditions, proposed for the participants and to the company.

The statute of the limited liability company can provide necessity of obtaining the consent of the company or other participants of the company for alienation of the stake (part of the stake) of the participant in the statutory fund of the company to a third party by the way other than sale. The consent of the limited liability company for the alienation of the stake (part of the stake) of the participant in the statutory fund of the company is deemed to be received, if within the time limit determined by the statute, but not more than thirty days from applying to the company, a written consent of the company has been received or no written refusal of the consent has been received from the company. The consent of other participants of the limited liability company for the alienation of the stake (part of the stake) of the participant in the statutory fund of the company is deemed to be received , if, within the time limit determined by the statute, but not more than thirty days from applying to participants of the company, a written consent of all other participants of the company has been received or no written refusal of the consent has been received from none of them.

The transaction on the alienation of the stake (part of stake) of the participant in the statutory fund of the limited liability company should be carried out in the simple written form and should correspond the requirements mandatory for the parties, established by the legislation, unless the requirement on the notarization of before-mentioned transaction is provided by the statute of the limited liability company or by the agreement of the parties.

The limited liability company should be notified in writing on the alienation of the stake (part of stake) of the participant thereof in the statutory fund of the company with submission of proofs of such alienation. The purchaser of the stake (part of stake) in the statutory fund of the limited liability company implements the rights and performs the duties of the participant since the date of notification of the company on before-mentioned alienation.

All the rights and duties of the participant who has sold the stake (part of stake) in the statutory fund of the limited liability company, which have arisen before alienation of that stake (part of stake), except for the rights and duties established for the specific participant only, are transferred to the purchaser of the stake (part of stake) of the participant in the statutory fund of the limited liability company. The participant who has sold the stake (part of stake) in the statutory fund of the limited liability company, is liable, jointly and severally with the purchaser of the stake (part of stake), for the obligation, which have arisen before the alienation of the stake (part of stake), of making the contribution to the statutory fund.

The participant of the limited liability company has the right to mortgage the stake (part of stake) in the statutory fund of the limited liability company, belonging to that participant, to other participant of that company or, unless it is forbidden by the statute of the company, to a third party, subject to the consent of the company in accordance with the decision of the general meeting of participants of the company, approved by the majority of votes of all participants, unless a greater number of votes is provided by the constituent documents of the limited liability company for adoption of such a decision. A vote of the participant of the limited liability company, intending to mortgage the stake (part of stake) in the statutory fund of that company, is not taken into consideration at determination of the results of voting.

Article 102. Transfer of the stake in the statutory fund of the limited liability company by inheritance and to successors

Stakes in the statutory fund of the limited liability company are transferred to the heirs of citizens and to successors of legal persons, which were participants of the limited liability company, unless the statute of the limited liability company provided that such transfer is allowed only with consent of other participants of the company . The consent is deemed to be received if within the time limit determined by the statute, but not more than thirty days from applying to the company of the heirs (successors), a written consent of all other participants of the company has been received or no written refusal of the consent has been received from none of them.

Refusal of the consent to transferring the stake in the statutory fund of the limited liability company entails the obligation of the company to pay to the successors of the died participant of the company or to the assignees of the legal person, which was the participant of the company, the actual value of the stake in the statutory fund of the company or, subject to the consent of the successors (assignees), to deliver the property in kind to the successors (assignees), corresponding to before-mentioned value.

The actual value of the stake in the statutory fund of the limited liability company is determined on the basis of the accounting balance sheet (the inventory book of incomes and expenses), drawn up on the moment of opening of inheritance or on the moment of succession of a legal person. Payment of the actual value of the stake in the statutory fund of the limited liability company or delivering the property in kind, corresponding to before-mentioned value is made after the expiration of the fiscal year and after the approval of the annual report for the year in which inheritance or legal succession of the legal person took place, within the time limit of up to twelve months from the date of refusal to give consent to heirs (successors) for transfer to them of the stake. The stake in the statutory fund of the limited liability company of heirs (successors) shall be transferred to the company from the moment of payment to them of the actual value of the stake in the statutory fund of that company (handing to them of property in kind corresponding to such value) and shall be realized in the order established by Article 100 of this Law, unless another order is provided by its statute.

Article 103. Withdrawal (expulsion) of the participant of the limited liability company from the company

The participant of the limited liability company has the right to withdraw from that company at any time, irrespective of the consent of other participants. In such a case, the participant of the limited liability company should inform the company on the withdrawal in writing. Withdrawal of participants of the limited liability company from the company as a result of which no one participant remains, including the withdrawal of the sole participant of the limited liability company from that company, is not allowed.

At the date of withdrawal, the participant of the limited liability company is obliged to fulfil the obligations which become due. The date of withdrawal of the participant from the limited liability company is the date of submission (obtaining) the application for withdrawal or other date specified by the participant in the application for withdrawal, but not earlier than the date of submission (obtaining) of the application. The participant of the limited liability company that submitted an application on the withdrawal from the company is entitled to apply in writing to the company about the recall of the said application till the determination by the general meeting of participants of the limited liability company, in accordance with part 5 of this Article, of the moment of settlement with that participant. In that case the participation in the limited liability company of the participant that submitted the application about withdrawal from the company is reinstated from the date when the general meeting of participants of that company took the decision to give consent to the recall of the application about withdrawal from the company, which is to be taken by the majority of the total number of votes of participants without account of votes belonging to the participant that submitted the application about withdrawal.

Expulsion of the participant of the limited liability company is carried out only through court proceedings at the request of other participants of the limited liability company, the stakes of which, in total, compose not less than ten percent of the statutory fund of the company, if such a participant grossly violates his duties, with the exception of duties stipulated by the contract on exercising the rights of participants of the limited liability company if the participant is a party to such a contract, or by his actions (inactivity) obstructs activity of the company. The moment of expulsion of the participant from the limited liability company is the date of entry into legal force of the court decision about his expulsion.

In the event of withdrawal (expulsion) of a participant of the limited liability company, the stake of that participant shall be transferred to the company itself from the moment of his withdrawal (exclusion) therefrom, and the withdrawn (expelled) participant shall be paid the actual value of his stake in the stake in the statutory fund of the limited liability company and also a part of the profit falling on his stake, received by that company from the moment of retirement of that participant till the moment of settlement. Upon an agreement of the withdrawing (expelled) participant with the remaining participants of the limited liability company, the payment of the actual value of his stake in the stake in the statutory fund of that company may be substituted by handing out him property in kind, corresponding to such value. 

The actual value of the stake of the withdrawing (expelled) participant in the stake in the statutory fund of the limited liability company shall be determined, unless otherwise established by the President of the Republic of Belarus, according to the accounting balance sheet (inventory book of incomes and expenses) to be drawn up on the moment of his retirement; and the part of profit due to him – on the moment of settlement. The moment of settlement with the participant withdrawing (expelled) from the limited liability company is the date of payment of the actual value of the stake in the stake in the statutory fund of that company or of handing out to him property in kind, determined specified by the decision of the general meeting of participants of the limited liability company. In that case, the decision of the general meeting of participants of the limited liability company is made by the majority of votes of all participants, not taking into consideration the votes belonging to the withdrawing (expelled) participant, unless a greater number of votes for adoption of such a decision is provided by the statute of the limited liability company.

Payment of the actual value of the stake in the stake in the statutory fund or handing out property in kind to the withdrawing (expelled) participant of the limited liability company shall be carried out after the expiration of the financial year and after the approval of the annual report for the year in which he withdrew (was expelled) from that company, within twelve months from the date of submitting the application for withdrawal or adoption of the decision on expulsion, unless otherwise provided by the statute of the limited liability company.

The actual value of of the stake in the stake in the statutory fund of the withdrawing (expelled) participant of the limited liability company shall be paid at the expense of a difference between the value of net assets of that company and its statutory fund. In the instance if such difference is insufficient for paying up the actual value of the stake in the statutory fund to the withdrawing (expelled) participant of the limited liability company, the company is obliged to decrease the statutory fund by the deficient sum.

Article 104. Levying the execution upon the stake (part of the stake) of the participant in the statutory fund of the limited liability company

Creditors of the participant of the limited liability company are entitled to demand levying execution on the stake (part of the stake) of that participant in the statutory fund of the limited liability company on the basis of a court decision upon insufficiency of other property for covering his debts.

In case of levying the execution upon the stake (part of the stake)  of the participant in the statutory fund of the limited liability company on debts of that participant, the limited liability company or other participants of that company has the right to pay to the creditors the actual value of the stake (part of the stake)  of the participant of the company, subject to the appropriate decision of the general meeting of participants of the company, approved unanimously, not taking into consideration the votes of the participant, upon the stake (part of the stake) of which the execution is levied. The actual value of the stake (part of the stake) of the participant in the statutory fund of the limited liability company, on which the execution is levied, shall be determined accounting to the accounting balance sheet (inventory book of incomes and expenses) to be drawn up on the date of presentation of the claim to that company by the creditors.

The actual value of the stake (part of the stake) of the participant in the statutory fund of the limited liability company, upon which the execution is levied, is paid to the creditors by other participants of the company proportionally to the stakes of those participants in the statutory fund of the company, unless another procedure of determination of the size of payment is provided by the statute of the company or by the decision of the general meeting of participants, approved unanimously, not taking into consideration the votes of the participant, upon the stake (part of stake) of which the execution is levied.

The stake (part of the stake) of the participant in the statutory fund of the limited liability company, upon which the execution is levied, shall be transferred to the company itself or to the other participants of that company from the moment of such payment.

Upon  an agreement of the creditors with the limited liability company or with the participants thereof, payment of the actual value of the the stake (part of the stake) of the participant in the statutory fund of the company, upon which the execution is levied, may be substituted by handing out property in kind, corresponding to such value..

In the event if within three months from the date of submission to the limited liability company by the creditors of an execution document stipulating levying execution on the stake (part of the stake) of the participant in the statutory fund of the limited liability company, the given company or its participants would not paid the actual value of the stake (part of the stake) of the participant in the statutory fund of the limited liability company or would not hand out property in kind, corresponding to such  value, the creditors are entitled to demand the sale of that stake (part of the stake) through the public trading in the order established by the legislation.

Article 105. Increase of the statutory fund of the limited liability company

The statutory fund of the limited liability company can be, and, in the cases established by this Law and by other legislative acts, should be increased.

The statutory fund of the limited liability company can be increased by means of:

own capital of the company;

making additional contributions by all participants of the company;

making additional contributions by one or several participants of the company;

making contributions by third parties admitted the limited liability company if it is not prohibited by the statute.

The decision on increasing the statutory fund of the limited liability company at the expense of own capital of the company shall be adopted on the basis of the data of accounting financial) statements (data of the inventory book of incomes and expenses) for previous financial year by the majority, but not less than two thirds of votes of the total number of votes of participants of the company, unless a bigger number of votes is provided by its statute for adoption of such decision. The sum by which the statutory fund of the limited liability company is increased at the expense of own capital of the company, must not exceed a difference between the value of net assets of the company and the sum of the statutory fund and reserve funds of the company. In such a case, the sizes of stakes of all participants of the limited liability company remain unchanged.

The decision on increasing the statutory fund of the limited liability company by means of making additional contributions by all its participants shall be adopted by the general meeting of participants unanimously.

The decision on increasing the statutory fund of the limited liability company should determine the size of increase of the statutory fund, the procedure of calculation of the value of the additional contribution of each participant and time limit of making such contribution, unless that time limit is determined by the statute of the company.

The decision on increasing the statutory fund of the limited liability company by means of making additional contributions by one or several participants of the company or by third parties is made unanimously by all participants of the company, on the basis of the application of one or several participants or applications of third parties. In the application, the size of the contribution and the structure of property contributed to the statutory fund, the procedure and time limit of making the contribution, and the size of stakes which one or several participants of the company or a third party would like to have in the statutory fund of that company, should be specified.

Simultaneously with the decision on increasing the statutory fund of the limited liability company on the basis of the application of one or several participants or applications of third parties, the general meeting of participants of the company should make the decision on making changes in the statute of the limited liability company, concerning the increase of the statutory fund, change of the list of participants and the sizes of stakes of other participants of the company.

Article 106. Decrease of the statutory fund of the limited liability company

The statutory fund of the limited liability company may be, and, in the cases established by this Law and by other legislative acts, should be decreased.

Decreasing of the statutory fund of the limited liability company can be carried out by proportional change of the value of contributions of all participants in the statutory fund of the company, unless otherwise established by the statute of the company or by the decision of the general meeting of participants of the limited liability company, approved unanimously.

Upon decrease of the statutory fund of the limited liability company by reduction of the value of contributions of all participants, the sizes of stakes of all participants of that company remain unchanged.

Decrease of the statutory fund of the limited liability company is permitted after notification of all creditors in accordance with the procedure established by part five of Article 28 of this Law.

Article 107. Exclusive competence of the general meeting of participants of the limited liability company

The exclusive competence of the general meeting of participants of the limited liability company, in addition to the matters specified in part one of Article 34 of this Law and in the statute of the limited liability company as the matters included in the exclusive competence of the general meeting of participants of the economic company, includes also:

forming executive bodies of the limited liability company and termination of powers thereof before the appointed time;

determination of the size, the form, the procedure and the time limit of making additional contributions in the statutory fund by the participants of the limited liability company and determination of sizes of stakes of each participant in the statutory fund;

decision on purchasing the stake (part of stake) of the participant of the limited liability company in the statutory fund by the company;

decision on admission of new participants in the limited liability company.

Article 108. Convocation and holding of  the general meeting of participants of the limited liability company

The general meeting of participants of the limited liability company is convoked by the executive body of the company, unless otherwise provided by the statute in accordance with part two of this Article.

If the statute of the limited liability company provides for forming of the board of directors (supervisory board), the arrangement of the matters connected with preparation, convocation and holding the general meeting of participants of the company may be referred to the competence thereof. In that case the executive body of the limited liability company has the right to require carrying out the extraordinary general meeting of participants of the company.

The extraordinary general meeting of participants of the limited liability company is held on the grounds established by part one of Article 48 of this Law, including on the request of participant(s) that hold(s) in aggregate not less than ten percent of votes from the total number of votes of the participants of that company, unless a lesser number of votes provided by its statute.

If the arrangement of matters connected with preparation, convocation and holding the general meeting of participants of the limited liability company is included in the competence of the executive body or the board of directors (supervisory board) of the company, those bodies should notify each participant about convocation of the general meeting of participants of the limited liability company within the terms specified by the statute in accordance with this Law, at the address specified in the list of participants of the limited liability company, by means of mail service or by other methods, ensuring the authenticity of messages, both transmitted and received, and documentary acknowledgement thereof.

Participants of the limited liability company have the right to attend the general meeting of participants, to participate in discussion of issues of the agenda and adoption of decisions with a right to vote, with the exception of the cases specified by part two of Article 93, part four of Article 99, part seven of Article 101, parts five and eight of Article 103, parts two and three of Article 104 and part five of Article 109 of this Law. Provisions of the statute of the limited liability company or the decisions of the bodies thereof, limiting those rights of participants of the company, are null and void.

Members of the board of directors (supervisory board) of the limited liability company and/or the person exercising the powers of the one-person executive body, or members of the collective executive body not being participants of the limited liability company, may attend the general meeting of its participants without the right to vote at adoption of decisions on the issues of the agenda of the general meeting.

Article 109. Order for adoption  of decisions by the general meeting of participants of the limited liability company

The statute of the limited liability company may establish the procedure of determination of the number of votes of participants of the company, out of proportion to the sizes of stakes of the participants in the statutory fund. Decisions of the general meeting of participants of the limited liability company on establishing or changing such procedure should be approved unanimously by all participants of the company.

The statute of the limited liability company may establish the list of matters when making the decisions on which the participants of the company have a number of votes out of proportion to the stakes thereof in the statutory fund, including the matters, for which each participant has one vote, and decisions on those matters are made by simple majority of votes, with the exception of the cases provided by this Law and/or the statute, when, for making decisions on specific matters, the qualified majority from the total number of votes is necessary, or when the decision should be made unanimously.

Decisions concerning changes of the statute of the limited liability company, including change of the size of the statutory fund, and decisions on other matters specified by the statute of the company, are made by the majority of not less than two thirds of the total number of votes of participants of the limited liability company, unless a greater number of votes for adoption of such decisions is provided by this Law and/or by the constituent documents.

Decisions concerning matters of reorganization and liquidation of the limited liability company should be made by all participants of the company unanimously.

In the event when the participant(s) of the limited liability company evade(s) the adoption by the general meeting of participants of the decision on introduction of changes and/or additions into the statute of that company in connection with the necessity of bringing it in accordance with the legislation and the number of votes of other participants is less than the number established by parts three and four of this Article for taking such decision, other participants of the company are entitled to take decision on introductions of changes and/or additions into the statute of the company only in the part of bringing it in accordance with the legislation unanimously without account of votes of the participant(s) evading the adoption of the said decision. It is considered that the participant(s) of the limited liability company evade(s) the adoption by the general meeting of participants of the decision on introduction of changes and/or additions into the statute of that company in connection with the necessity of bringing it in accordance with the legislation, when the participant(s) notified in due order more than twice about the convocation and holding of the general meeting of participants, the agenda of which includes the said matter, do(es) not participate in it without valid excuse or repeatedly (twice and more) vote(s) against such decision or abstain(s) from its adoption.

Article 110. Specific features of audit in the limited liability company

At the request of any of the participants of the limited liability company, in accordance with Article 61 of this Law, the audit of the bookkeeping (financial) statements (data of the inventory book of incomes and expenses) of that company may be carried out. In case of carrying out such audit, payment for audit services is carried out at the expense of the participant of the limited liability company, on the request of which the audit is carried out. The expenses of the participant of the limited liability company for payment for such audit can be reimbursed to the participant, according to the decision of the general meeting of participants of the company, at the expense of the company.

In the event if the governing body of the limited liability company authorized by the statute has not taken measures on holding the audit at the request of its participant, the mentioned participant is entitled to act as the ordering customer of the audit. In that instance selection of the audit organisation (auditor – individual entrepreneur) and conclusion of the contract of rendering audit services are carried out by that participant himself with the right to collect expenses for conducting the audit from the limited liability company. In that instance the limited liability company is obliged to create conditions for timely and quality conducting of the audit for the audit organisation (auditor-individual entrepreneur), including to provide all necessary documents.

If the governing body of the limited liability company authorized by the statute evades from conduction the audit at the request of its participant or does not create proper conditions for its conducting, the audit may be conducted on the basis of a court decision on an action of the participant demanding its conducting.

Article 111. Reorganization and liquidation of the limited liability company

Reorganization or liquidation of the limited liability company can be carried out voluntary, subject to the unanimous decision of participants of that company, and on other grounds and in accordance with the procedure specified by this Law and other legislative acts.

The limited liability company is entitled to be transformed in the joint-stock company, additional liability company, economic partnership, production co-operative or unitary enterprise.

If the number of participants of the limited liability company exceeds fifty, limited liability company is subject to reorganization within one year, and, after expiration of that term, it is subject to liquidation through court proceedings, unless the number of participants would be reduced to the established limit.

In case of liquidation of the limited liability company, the property of liquidated company, remained after settlements with the creditors, is distributed by the liquidation commission (the liquidator) between the participants in accordance with the following priorities:

first, payments of distributed but non-paid part of profit for the participants of the limited liability company are carried out;

second, distribution of property of liquidated limited liability company between the participants of the company, proportionally to the stakes in the statutory fund of the company, is carried out.

If the property being in the disposal of the limited liability company is insufficient for payment of distributed, but not paid part of profit, the property of the company is distributed between the participants proportionally to the interests of participants in the statutory fund of the company.

Article 1111. Contract on exercising rights of participants of the limited liability company

Participants of the limited liability company are entitled to conclude a contract on exercising rights of participants of the limited liability company under which they undertake to exercise in a certain manner their rights and/or to abstain from exercising them, including to vote in a certain manner at the general meeting of participants of the given company, to agree an option of voting with other participants, to sell the stake (part of the stake) at a price determined by the given contract and/or upon occurrence of certain circumstances or to abstain from alienation of the stake (part of the stake) prior to occurrence of  certain circumstances, and also to carry out in an agreed manner other actions related to managing the company, creation, activities, reorganization and liquidation of the company.  Such contract shall be concluded in writing by means of drawing out one document signed by the parties.

The limited liability company must be notified in writing by one of the participants of the contract on exercising rights of participants of the limited liability company, authorized by other participants, about conclusion thereof not later than three days from the date of conclusion of such a contract. The limited liability company must, in the order provided by its statute, disclose to participants not being a party to the contract on exercising rights of participants of the limited liability company the information about conclusion of such a contract, including the data about participants of that contract and the number of stakes in the stakes in the statutory fund of the company, belonging to them. In the instance if the contract on exercising rights of participants of the limited liability company is concluded within the time limit of less than three days prior to the date of holding the general meeting of participants of the limited liability company, the company must be notified thereabout on the day of conclusion of the given contract . In that instance the data provided by this part about conclusion of the contract on exercising rights of participants of the limited liability company must be disclosed prior to the beginning of holding the general meeting of participants of the limited liability company.

Norms of Article 901 of this Law are applied to the contract on exercising rights of participants of the limited liability company, unless otherwise follows from the nature or relations.

CHAPTER 10
ADDITIONAL LIABILITY COMPANY

Article 112. Principal provisions on the additional liability company

The additional liability company is the economic company with number of participants not exceeding fifty, and with the statutory fund divided into the stakes, sizes of which are specified by the statute. The participants of such company bear the subsidiary liability, jointly and severally, for the obligations of the company by the property thereof, within the limits determined by the statute of the company, but to the extent not less than the value established by the legislative acts, proportionally to the contributions of those participants to the statutory fund of the additional liability company.

The statute of the additional liability company can provide other procedure of distribution of the additional liability between the participants.

In case of economic insolvency (bankruptcy) of one of participants of the additional liability company or insufficiency of property of one or several participants of the company for providing of due stake of additional liability, the liability of that (those) participant(s) for the obligations of the company is distributed between other participants proportionally to the contributions thereof, unless the statute provides other procedure of distribution of the liability.

The statute of the additional liability company should contain, in addition to the data specified in Articles 14 and 92 of this Law, the data on the size of additional liability of participants of the company and the procedure of its distribution among the participants.

The name of the additional liability company should contain words "additional liability company". The abbreviated name of the additional liability company should contain the abbreviation "ODO" (additional liability company).

The provisions of this Law, concerning the limited liability company, are applied to the additional liability company, unless otherwise provided by the legislative acts.

Article 113. Change of the amount of the additional liability

The additional liability company has the right, subject to the notification of creditors, to reduce the size of additional liability of the participants of the company, (however, as a result of such reduction, the size of additional liability of the participants should not become less than the size established by the legislative acts), or to increase the size of additional liability, subject to the consent of all participants of the company. At making the decision on change of the size of the additional liability of participants of the additional liability company, at the same time, the decision on appropriate changes in the statute should be made.

The creditors of the additional liability company have the right, in case of reduction of the size of additional liability of participants of the company, to claim for the termination or fulfilling of the corresponding obligations of the company before due date, and for the compensation of losses.

 

Chairperson of the Supreme Soviet of the Republic of Belarus

S. Shushkevich

* unofficial translation *