Medvedev Signs into Law New Protections for Creditors’ Rights

The Kremlin's public relations office stated that the President of the Russian Federation, Dmitry Medvedev, has introduced legislative amendments to strengthen the protection of creditor’s rights.

The president signed the law “On the Introduction of Changes in Various Laws the Russian Federation, in Part to Revise the Protocols for Protecting Creditors’ Rights Under the Reduction of Charter Capital, or Changing Demands Made on Commercial Partnerships When Discrepancies Occur in the Value of Charter Capital.” This document was passed by the State Duma on July 6th, and approved by the Federation Council on July 13th, 2011.

The laws “On Joint-Stock Companies” and “On Limited Liability Partnerships,” have been amended to simplify the procedure of providing written notice regarding reductions in charter capital in commercial partnerships. Simultaneously, these new protocols protect the rights of creditors in the case of a charter capital reduction  or in the case of changes in the value of a company’s net worth. In particular, information will be submitted concerning the reduction of charter capital and concerning the net worth to a Unified Federal Register detailing the activities of legal entities.

The federal law which will create of this register will also stipulate how the register will be formed and maintained, rules for submitting information to it, and the requirements for information entered into it. This register will include information about bankruptcies, with the corresponding modifications introduced in the legislation “On Insolvency (Bankruptcy).”

Apart from this, the federal executive branch is establishing a process to assess the net worth of commercial partnerships (excluding creditor organizations).