September 24 2007
Corporate legislation has changed little since the new Civil Code came into force on January 1 2004. However, in April 2007 Parliament finally turned its attention to the question of eliminating conflicts between the code and the Company Law. On June 20 2007 the Law on Amendments to the Company Law came into force, making fundamental changes to the legislative framework which regulates companies in Ukraine.
The aim of the changes was to bring the Company Law into line with the code. However, the amendments have not all had the expected or intended effects. The most significant changes are as follows:
The practical effects of the recent amendments have yet to be fully evaluated, but certain changes appear to be conducive to hostile takeovers. However, in June 2007 the Cabinet of Ministers submitted to Parliament a draft law proposing further amendments which are intended to clarify the ambiguous drafting in the amended law and resolve the remaining conflicts with the code. The draft law includes proposals to:
Although future developments in corporate legislation remain uncertain, recent changes indicate a positive trend towards reform. However, until Parliament approves either a new general law on companies or special laws on joint stock companies and other corporate structures, the legislative ambiguity in the sector will remain.
For further information on this topic please contact Yaroslav Abramov at Arzinger & Partners by telephone (+380 44 390 5533) or by fax (+380 44 390 5540) or by email (email@example.com).
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