Experts have prepared the Draft Law formally titled, “On Amendments to Certain Legislative Acts of Ukraine on Certain Issues of Equity Participation of Both Legal Entities Registered in the Aggressor State (and/or Legal Entities Whose Ultimate Beneficiary Owners are Citizens of the Aggressor State) and Citizens of the Aggressor State in Legal Entities Registered Under Laws of Ukraine”.
The Draft Law:
1) Amends the laws of Ukraine “On Limited and Additional Liability Companies” and “On Joint Stock Companies” to exclude, by a decision of the general meeting, a shareholder of the company if he or she is a citizen of the aggressor state or a legal entity registered in the aggressor state or a legal entity whose ultimate beneficial owner is a citizen of the aggressor state. The Draft Law recommends not considering votes of such a shareholder in determining voting results. Throughout the martial law period, such shareholders shall not be allowed to either sell their share in the authorized capital of the company or to be paid dividends;
2) Deprives the following persons and entities of the right to manage a joint-stock company or the right to receive dividends as well as participate in the adoption of certain decisions: A shareholder of ordinary shares and/or a shareholder of preferred shares if he or she is a citizen of the aggressor state, or a legal entity registered in the aggressor state, or a legal entity whose ultimate beneficial owner is a citizen of the aggressor state. It will be prohibited for such shareholders to sell their shares. It is recommended to implement such restrictions for the entire martial law period.
Adoption of this Draft Law will protect Ukraine’s economic and national security interests. On April 12, the Draft Law was registered in the Verkhovna Rada under number 7277.
