09/21/08

Ukraine Business Law

Ukraine Legislature Passes Landmark Law on Joint Stock Companies

By Nova Mova from Internet sources.
 
On September 17, 2008, Ukraine’s national legislature, the Verkhovna Rada, voted overwhelmingly to adopt the Law on Joint Stock Companies (JSC). This law is intended to strengthen the rule of law, protect shareholders’ rights, and protect against corporate raiders. When signed into law, it is expected to improve Ukraine’s investment environment.
 
The law defines the conditions and standards for establishing, governing and terminating JSC activity, and it also defines the legal status and mechanisms to protect shareholders’ interests.  Through this new law, a stronger legal basis will be established to close loopholes that are often used by illegal corporate raiders, and it provides greater safeguards for the rights of minority shareholders.
 
Adoption of this law is expected to make the environment for investment in Ukraine safer and more inviting for potential investors, thereby improving Ukraine’s global competiveness and improving the financial markets. Experts have long said that the lack of such legislation to strengthen the rule of law and protect property rights has seriously hindered the development of Ukraine’s financial markets.
 
Most facets of the new law will come into effect six months after it is officially published; a section dealing with company stocks in electronic form will come into effect in two years.

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