Previously, the pre-emptive right to purchase a share in a limited liability company (LLC) was automatically granted to all participants. Now, the company’s charter may establish special conditions for exercising this right.
What can be changed in the charter?
- Fully exclude the pre-emptive right for participants
- Make the pre-emptive right conditional upon specific circumstances, deadlines, or a combination thereof
- Set conditions for specific participants by naming them (full name / corporate name) or by defining criteria (e.g., size of share)
- Remove provisions on non-application of the exclusive right — in this case, the general procedure applies
- Remove conditions for exercising the right — the procedure established by the charter applies without those restrictions
- If a share is transferred to another person (participant or third party), special conditions applicable to the previous participant do not apply to the new holder
Requirements for amending the charter
- Inclusion of provisions in the charter requires a unanimous decision of all participants
- Removal of provisions requires a decision adopted by at least 2/3 of votes (the charter may set a higher threshold)
- Any decision to add or remove such provisions must be notarized
Key takeaway
Participants in an LLC now have significantly more flexibility to structure share transfer rules and protect the business from unwanted third-party involvement.
For questions regarding share ownership and corporate structuring, contact us at inbox@teamgroup.ru