The Law of Ukraine “On Limited Liability Companies” (bill No. 4666), adopted by the Parliament (Verkhovna Rada) on February 6, 2018, contains a number of obvious improvements, in comparison with the current legislation. According to the senior partner of ARIO LAW FIRM Julian Khorunzhyi, positive changes were made to the provisions on inheritance and succession of shares.
The innovation of the adopted document is the abolition of the quorum concept of the general meeting of the LLC members, without which the general meeting is not entitled to take a decision. However, according to Khorunzhyi, until the formation of the judicial practice of the application of the law, the concept of “quasi-quorum” will remain controversial – the number of votes of participants (from 50 to 100%) who are authorized to take decisions on specific issues within the competence of the general meeting.
Khorunzhyi considers it a positive moment that the adopted version of the draft law gives the absolute majority of questions to the LLC itself, does not establish unambiguous rules, but enables the company to adopt its own procedures, identify those bodies that it needs in corporate governance and anticipate possible ways out of potential corporate conflicts. In a one-participant model, the participant is no longer obliged to imitate the general meeting, but can take all decisions solely in the form of a written decision. Khorunzhyi said the law creates opportunities for the reorganization of joint-stock companies, which are not actually such, in an LLC, since the project eliminates the limitation of the maximum number of LLC members. At the same time, “unambiguous conclusions” about the adopted law can be made only after the signing of the draft law by the president, he said.
