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Stricter requirements for corporate solutions: registration refusals

Recently, the position of notaries, banks and registration authorities regarding the signing of corporate decisions by LLC participants has become tougher. Now these bodies and organizations often refuse to make such decisions if they are not notarized (even if they were signed in Russia).

We have encountered several such cases in our practice. Thus, when extending the powers of the general director, the bank refused to accept a decision signed without a notary, arguing that there are no appropriate and sufficient formulations in the charter.

In another case, the client had to urgently sign a notary decision on the change of the general director. In such situations, when the corporate procedure needs to be carried out quickly (for example, the company wants to urgently change the director), the unforeseen refusal of the authorities to make "non-notarial" decisions can significantly complicate the situation.

In such a situation, companies with Western participation are forced to organize notarization and apostille on decisions in other jurisdictions in the difficult conditions of the coronavirus pandemic. At the same time, it is not always possible to quickly hold a meeting with a notary, and apostilling documents can take up to a month.

The reason for the change in the approach of the authorities was that on 25.12.2019 The Presidium of the Supreme Court of the Russian Federation approved a new approach to the procedure for confirming decision-making by LLC participants. From this date, as a general rule, all decisions of the participants must be made in the presence of a notary.

To exclude visiting a notary when making decisions, you can choose one of two ways:
to make appropriate changes to the company's charter;
sign a separate decision on the establishment of a method for confirming the decision-making by the participants.
To avoid problems and delays in the work of the company, we recommend that you choose one of the listed methods and issue the appropriate document, which in the future can be presented to banks and registration authorities.

In addition, we remind you that Russian LLCs are obliged to bring their charters in line with the systemic changes in legislation that came into force on 01.09.2014, at the first time any changes to the charter are made.

When making amendments to the charter, it is also important to check the provisions on the procedure for approving internal documents of the company, including local regulations (LNA). If the company does not comply with the established procedure for approving the LNA, risks associated with the invalidity of these documents may subsequently arise. In particular, there is a possibility of risks when working with the company's personnel, including during inspections of regulatory authorities and in court proceedings.

We will be happy to support in all procedures related to the implementation of these changes:
when checking/correcting the provisions of your company's articles of association;
when preparing a decision on the approval of a new version of the charter, as well as the registration of a new charter;
when preparing a decision on the establishment of a method for confirming the decision-making by the participants without making changes to the charter.