Corporate Legal Relations Research Articles

Taking risky actions as a basis for prosecuting the officials of the business company

On the basis of the conducted analysis, it has been concluded that the responsibility of the officials of entrepreneurial companies in modern law is studied in the context of corporate governance as one of the elements of the management and control system of companies and one of the means of ensuring their responsible management. At the same time, the issue of clear delimitation of powers between the bodies of an entrepreneurial company is closely related to the issue of liability of their officials to the company itself, since their liability always arises as a result of violation of the duties assigned to a particular body (to one or another official).
 It is the specific definition of the rights and obligations of persons performing the functions of the bodies of a business company, and their activities on behalf of the company in good faith and reasonably and without exceeding their powers that forms the basis for the stability of property and non-property corporate relations within the corporate governance of a business company.
 The essence of risky actions as grounds for bringing to responsibility of officials of an entrepreneurial company has been clarified. It has been concluded that, given the essence of the risky activities of an entrepreneurial company aimed at making a profit and its further distribution among the participants, the actions (inaction) of the participants of relations within the relevant legal entity contain risks of both economic and legal content. Such risks should be classified into justified and unjustified, which are associated with the further possibility of bringing to justice the persons guilty of causing damage to the participant of corporate legal relations. It has been emphasized that it is the justified nature of entrepreneurial risk in the actions of persons performing the functions of the bodies of an entrepreneurial company, and their reasonable, conscientious, with due care and prudence activity, as well as taking all measures for the proper performance of duties and prevention of adverse legal consequences for the company, allows o talk about their release from liability for damages.
 It has been noted that the legal mechanism of civil liability of officials to the business company for actions that are risky and may cause damage to the company needs to be improved in domestic law.

Jurisdictional remedies for corporate rights in Ukraine: Sub-standard remedies in corporate disputes

In the context of the European integration processes taking place in Ukraine, there is a convergence of the national legal system with the legal principles and provisions of the European Union, including in the field of corporate legal relations. The main purpose of this study was an independent study of problematic issues that arise upon the implementation of sub-standard remedies in corporate disputes to develop author’s conclusions and recommendations to ensure sustainable and effective law enforcement practices. The methodological framework of this study included the principles of cognition of social phenomena in their historical development, interrelation, and interdependence, a dialectical approach to the study of theory and practice, the history and current state of law. The leading methods were historical, comparative legal, and dialectical. Based on the results of the investigation, the study covered the leading issues of the state of modern legal regulation of sub-standard remedies in corporate disputes in Ukraine; analysed the main issues of theoretical certainty regarding sub-standard remedies in corporate disputes and suggested new vectors of reforms concerning further improvement of law enforcement practice. The author’s conclusion on the need to ensure the unity of law enforcement practice by introducing changes to the legislation of Ukraine towards detailed regulation of sub-standard remedies in corporate disputes, which also correlates with the reformation vectors of development of Ukraine in the context of European integration, will become a stable basis for further scientific research and legislative transformations in the field under study.

PROBLEM OF EXCLUDING A PARTICIPANT OF A BUSINESS COMPANY

Corporate legal relations may be terminated voluntarily or non-voluntarily. Since Ukrai­nian corporate law has been significantly amended recently, there has emerged the need to re-think the legal mechanism of the grounds for terminating corporate legal relations non-voluntarily for a member. This research considers the problem of exclusion of a member of a business company, identifies gaps and inaccuracies in the legal regulation of this issue in the current legislation of Ukraine. The study considers three reasons for expelling a member of corporate legal relations, which are applied in the national and foreign legislation. While analyzing the theoretical and practical aspects of the exclusion of a participant due to systematic non-fulfillment or improper fulfillment of his duties or obstruction by his actions of the goals of the society, which until 2018 was provided for in Art. 64 of the Law of Ukraine “On Business Companies” for lim­ited liability companies, the experience of foreign countries in implementing such a rule was considered, as well as the decision of the Supreme Court to appeal the decisions of the general meeting on exclusion. Since the previous version of these expulsion grounds implied the rel­evant decision to be passed by the general meeting and the application of judgments only, the conclusion was made on the need to provide in the Law of Ukraine on Limited and Additional Liability Companies for the possibility of initiating the expulsion under the legal action brought by the entity member, and not under the decision of the entity general meeting due to the sys­tematic non-performance or underperformance of their obligations or their interference in the entity pursuing its goals. Considering the issue of expelling a deceased member of a limited liability company, the conclusion was made on the inappropriateness of applying the term of expulsion to a deceased member, since the point is in excluding the deceased member and the data on him/her from the public register. Hence, respective rewording is required in the existing legislation to avoid any misrepresentations. The position was established on the ways of solving the topical issues, emerging while expelling a member of an entity based on different grounds.

THE IMPLEMENTATION OF THE PRINCIPLE OF COOPERATION OF CIVIL LAW SUBJECTS IN CORPORATE LEGAL RELATIONS

Abstract: the principle of cooperation of civil law subjects, traditionally referred to as the principles of the law of obligations, has a much deeper content, allowing it to extend its effect to other types of civil law relations. Corporate legal relations, based on a material relations consisting in the unification of efforts by civil law subjects to achieve a common goal – the effective functioning of the corporation – cannot exist in isolation from the idea of cooperation and mutual assistance of its participants. In the article, the author analyzes the content of the principle of cooperation of civil law subjects through the prism of the specifics of the content of corporate legal relations and the problems of its subject composition. As a result, the author comes to the conclusion that in a corporate legal relations, the principle of cooperation is implemented through the doctrine of fiduciary duties both in terms of the imperatives of the information cooperation group aimed at ensuring the awareness of members of the management bodies of the corporation and the activity cooperation group aimed at eliminating accidental obstacles to achieving the goal of the legal relations.

The right to information in the legislation on corporate relations: national and foreign regulation experience

The purpose of the article is to carry out a theoretical and legal analysis of the right to information in national and foreign legislation on corporate relations and to develop substantiated theoretical conclusions on the improvement of national corporate legislation. Methodology. The following general scientific methods were used in the process of research object analysis: the method of analysis, synthesis, deduction, abstraction, comparison, system-structural, structural-logical methods. Comparative legal and formal legal methods have become the basis for the analysis of national and foreign corporate legislation, identification of similarities and differences in the general principles of respective legal relations regulation. Results. The study found that the right to information is a guarantee of corporate rights and legally protected interests of corporate legal entity (corporation) members, as information enables corporation members to exercise their corporate rights properly. The analysis of national legislation gives grounds to state that the legal norms enshrining the right to information in corporate legal relations and the order of its realization, are formulated unsystematically and in an abstract way. National corporate legislation acts do not contain a detailed list and types of information to which a corporation member is entitled. Scientific novelty Analysis of the main corporate legislation acts of the United Kingdom of Great Britain and Northern Ireland, the Commonwealth of Australia and Canada gives ground to state that the right to information in corporate relations is considered to be the right to any information about the corporation in the Anglo-Saxon legal family. Practical significance. The need of making changes to national corporate legislation acts in the process of recodification of the civil legislation of Ukraine has been proven. It has been proposed to recognize any information about the corporation and its activities as an object of corporate relations whether this information directly or indirectly concerns the exercise of members’ corporate rights or performance of respective duties, and to detail the way of the right to information realization in corporate legal relations.

Possibility of Applying the Category "Good Faith and Abuse of Procedural Rights" to Participants in Disputes Arising from Corporate Legal Relations under the Legislation of the CIS and Neighboring Countries

The existence of once common foundations of the procedural legislation of the CIS and neighboring countries with its subsequent independent development is of interest from the point of view of the analysis of individual procedural institutions. The paper examines the institution of abuse of procedural rights in relation to the category of corporate disputes.The procedural legislation of the Soviet period did not fix the concept of abuse of procedural law and did not contain its clear criteria for appropriate classification of certain negative cases in the procedural behavior of a participant in a trial in order to suppress such facts. It is with this "legacy" that the countries of the post-Soviet space approached the problem of abuse of procedural rights in the framework of the formation of their own procedural legislation. Attempts to solve this problem often had cardinal differences.As the analysis of the studied sources shows, the category of "good faith and abuse of procedural rights", in contrast to the Russian procedural legislation, is disclosed in all the examples exclusively within the general part of the procedural laws, which leaves a wide margin of discretion for the law enforcement officer when considering a particular category of disputes. Based on the analysis of the available procedural sources, two constructions of the "good faith — abuse" model were identified. The first one, the "sanctions" model of "good faith-abuse" is presented in most of the procedural sources of the CIS and neighboring countries. The second, "compensatory" model, although singled out separately in the procedural laws, does not disclose the mechanism of compensation for losses by a person who has abused his procedural rights, and therefore seems less effective in terms of protecting the victim from the unfair behavior of his procedural opponent.

Joint-stock form of corporate control: features of the formation and functioning of its civil-law mechanisms

This article is devoted to the research of civil law mechanisms for the formation and implementation of a joint-stock form of corporate control in the Russian Federation. According to the authors, the joint-stock form of corporate control is the most important form of influence on participants in corporate legal relations from the shareholders of joint-stock companies. The paper examines the influence of the joint-stock form of corporate control on the functioning of joint-stock companies as the most important form of corporate organizations in Russia.

The moment of termination of corporate legal relations

The long-term nature of corporate legal relations necessitates the theoretical selection of certain moments of their emergence, change and termination. The update of the corporate legislation has necessitated a review of the established positions on the moment of termination of corporate legal relations, analysis and study of the legislation and resolution of problems that arise in connection with its application. The introduction of the institution of consent in corporate legal relations necessitated a scientific rethinking of certain aspects of the mechanism of termination of corporate legal relations. The article investigates the main scientific approaches to determining the moment of termination of corporate legal relations, analyzes the moment of termination of corporate legal relations depending on the grounds for their termination. Based on four main approaches to determining the moment of termination of corporate legal relations, the positions of scientists who adhere to them are studied, changes to the current corporate legislation are analyzed, inconsistencies regarding the moment of termination of corporate legal relations are revealed. The peculiarities of the moment of termination of corporate legal relations in case of alienation of a share (part of a share) in the authorized capital of the company, exclusion of a participant from the company, its withdrawal, withdrawal, recovery from the defendant (claim from his possession) to a share (part of the share) are analyzed. Peculiarities of state registration of changes in information about a legal entity in the aspect of determining the moment of termination of corporate legal relations are determined. A position has been formed regarding the application of a separate approach to determining the moment of termination of corporate legal relations on certain grounds for termination of corporate legal relations and suggested ways to resolve existing inconsistencies in corporate law regarding certain grounds for termination of corporate legal relations.

Практика реализации прав супругов в корпоративных правоотношениях

In modern business activities spouses often become participants in corporate legal relations. The potential holder of corporate rights to implement the rights belonging to him, within his legal marital status is sufficiently important for both the rights holder and other members of the economic society, as it is the opportunity to use its corporate rights in their interest and is meaningful to its legal status as a subject of corporate relations and marriage. The article defines the legal limits of the implementation of the rights of spouses in corporate legal relations, and makes suggestions for improving the legislation.

Правовое регулирование корпоративного договора в контексте корпоративной культуры акционерного общества

The relevance of this article is due to the need to study legal nature of the corporate contract in the field of corporate culture and the system of corporate governance in modern conditions. The subject of the study is regulatory legal acts governing corporate contracts conclusions, as well as doctrinal sources and interpretations. The purpose of the work is to conduct a study of the corporate contract institution and to identify its legal nature and significance for corporate governance. The author shows various points of view on the nature and content of the corporate contract, examines the positions of legal scholars on its binding or dual nature, including applying this design in corporate legal relations. The article also considers certain issues of corporate governance, effective tools in the management system and analyzes the possibility of applying a corporate contract in the framework of governance in corporate legal entities. One of the main points is the justification of the corporate contract essential role in regulating the business companies` corporate governance system, since it can determine the structure of corporate bodies, their competence, which are reflected both in the charter of a corporate legal entity and directly in the corporate contract itself. The author concludes that there is a need to further improving this contractual design in order to increase its enforceability and attractiveness in various economic societies.

Корпоративный контроль в российском и зарубежном праве: взаимосвязь права и экономики

The accelerating pace of development of socio-economic relations is a powerful impetus for the modernization of legislation, which in the conditions of globalization of markets should not only preserve the stability properties, providing a balance of private and public interests, but also create conditions for the further development of entrepreneurship.Legislation-designed models for regulating corporate relations and control are in the zone of close attention of business, regulators, and the legal community. Over the entire history of the development of corporate law, the legislator has not found the optimal form of combining the dispositive and peremptory regulation of corporate legal relations, providing an adequate reflection of economic realities and resolving the conflict of multidirectional interests of participants in corporate relations. The issues of choosing the priority of protected interests, determining the limits for exercising and protecting corporate rights, finding acceptable forms of concentration and implementing corporate control in business are relevant. The market knows a wide arsenal of multifunctional contractual methods for acquiring and splitting corporate control (repos, equity loans, options, swaps, derivatives, securities difference agreements, etc.) that ensure the private interests of investors and lenders. However, ensuring the freedom to exercise private interest in choosing a corporate control model presumes that the public interest is in the stability of turnover and the protection of an indefinite number of persons participating in it, which can be ensured through mandatory public disclosure of corporate control information in the corporation.In modern conditions, the legal regulation of the concentration and implementation of corporate control is a prerequisite for creating a healthy investment and business climate in the economy, guarantees for the interests of investors and participants of the corporation, which should be taken into account when developing corporate legislation. The definition and differentiation of the economic content and legal form of corporate control is necessary for the further development of mechanisms and models for the implementation and protection of corporate rights. The legal regulation of corporate control is not homogeneous and is not limited only to the subject of civil law regulation of corporate relations; according to industry, certain segments of corporate control relations can be regulated by competition and financial law.

Foreign experience review in legal regulating the transfer of rights to assets in case of participation in capital of business entities to one of the spouses in case of the divorce

World statistics shows a steady trend towards of marriage at mature age. As a rule, in such cases parties (or one of the parties) already accumulate different kind of assets: real estate, movables, deposits, assets as participation in authorized capital of commercial organizations (shares, stocks), etc. The assets protection is the important life aspect of spouses. The prenuptial agreement conclusion is one of the ways of such protection. That’s allows confirming the agreement of the spouses on the property regime, as well as on the procedure for its division. Despite globalization trends, family law norms and the legislation of corporate legal relations regulation in the world community is not uniform. Usually they are also dispositive, providing the participants to choose their own option of legal relations behavior opportunity. The analysis of the foreign legislation and law enforcement experience of the transfer the ownership of the spouses assets in commercial organizations during the divorce could be useful for the national legislation of the Russian Federation development.

Legitimate Expectations as an Object of Corporate Legal Relations

The authors have conducted the analysis of the legislation of Ukraine, the case law of Ukraine and the European Court of Human Rights, as well as doctrinal approaches to understanding legitimate expectations as objects of corporate legal relations. It has been concluded that the share (capital share), and in fact participation in the company, is an asset associated with the occurrence of favorable property consequences in the future, and has all the characteristics of legitimate expectations. Participation in a company has all the characteristics necessary for its potential monetary evaluation, because it is negative from its owner (does not have a personal, inseparable connection with the person to whom it belongs), and therefore is potentially viable. Monetary evaluation of the participation in the company allows us to classify this object as property benefits (asset). The emergence of economic benefits, as a result of the use of participation, the exercise of the right to it, indicates the connection of such benefits with the consequences that arise. Thus, participation in the company has all the characteristics of legitimate expectations. That is, the participant expects in the future to receive economic benefits from the participation in the company (exercise of corporate rights) that result from the placement of certain values in the charter capital, which have a monetary value. Legitimate expectations, in addition to regulatory corporate legal relations, can be recognized as the object of protective corporate relations, based on the facts of the violation of the right to peaceful possession of such property. It is applied both to the violation of the right to manage the corporation (in case of failure to notify about the general meeting of participants) and the refusal to repurchase shares from a shareholder as the exercise of the “right to disagree”. It is alleged that there are also protective legal relations with such an object as legitimate expectations in case of the violation of the rights to dividends, to the payment of the value of the share (capital share), to the liquidation quota. But such legal relations are not corporate, because the rights to be protected are not included into the group of corporate rights.

The concept and legal nature of corporate relations: the position of doctrine and judicial practice

Nowadays the processes of democratization, liberalization, integration of Ukraine into European and world space take place. Theundisputed significance for these processes is the signing of the Association Agreement between Ukraine and the European Union.Thus, the rapprochement of Ukraine with the European community, which has taken place in recent years, affects the sphere of privatelaw relations, which make up the subject matter of civil law. Taking all mentioned above into account corporate relations and its nationalregulation is critical issue for analysis.The provisions of national legislation regarding the definition of corporate rights and respective legal relations are analyzed. Specialattention is paid to the position of the civil law doctrine representatives in terms of legal nature and features of corporate legal relations.Analysis of current doctrine gives ground to state that corporate relations are considered to be a special type of civil legal relationsthat make up the subject of civil law. At the same time recognition of corporate relations as a type of civil ones makes it possible to useall the civil law tools and mechanism of legal protection and enforcement for corporate relations regulation.The relevant practice of the highest judicial bodies of Ukraine is analyzed. The analysis of the legislation and judicial practicehas given an opportunity to stress some problems that need to be eliminated. To our mind, one of the main problems is “fragmentation”of the legislator’s attention to the definition of corporate legal relations, which creates the ground for numerous discussions. At the sametime there are critical problems in judicial practice. For instance, we cannot agree with the Supreme Court’s attempts to find corporatelegal relations in those types of legal entities in which such legal relations do not take place at all.It is crucial to stress that recodification of civil legislation in Ukraine has its direct impact on private legal relations system andits mechanism of legal regulations.

Reasons for the Emergence, Change and Termination of Corporate Legal Relations

Corporate relations are developing quite quickly, thus becoming more complicated and, accordingly, in need of proper settlement. Therefore, the main purpose of the work is to determine the range of grounds for the emergence, change and termination of corporate relations. Methodologically, the study of legal facts in the mechanism of legal regulation of corporate relations is conditionally divided into three parts: law-generating, enforcing and terminating grounds. The legal structure is singled out. The deduction method was chosen as the main method. The paper draws attention to the fact that recent changes in law and jurisprudence, as well as the doctrines of law, leave unanswered a number of questions, one of which is to define the circle of grounds for the emergence, change and termination of corporate legal relations. It is proved that such bases in the activities of corporations in their composition and quality can be simple and complex. The first are the grounds giving rise to legal consequences only in the presence of one legal fact, while the second is the basis on which there are several interrelated legal facts, and, accordingly, legal facts having multiple legal directions. Legal facts in the mechanism of legal regulation of corporate legal relations have all the signs of the traditional specific differentiation of legal facts that exist in the current legal doctrine and applicable law of civil law. At the same time, they have their own peculiarities, which are characteristic only of corporate legal relations. The conducted analysis is of theoretical importance for further research of the mechanism of legal regulation of corporate relations, as it allows to expand with the help of deductive method the idea of the grounds for the emergence, change and termination of corporate legal relations. This, in turn, will facilitate the formation of clear and consistent case law.

Implementation of the Doctrine of Good Faith (Bona Fides) in Corporate Legal Relations

Good faith (bona fides) is presented in the Civil Code of the Russian Federation as a general principle and presumption. In resolving corporate disputes, the courts are governed by general principles of good faith. However, corporate relations have a specificity due to, inter alia, the variety of corporate forms. It can be assumed that the application of good faith provisions should also vary taking into account the characteristics of corporate patterns, the types and forms of corporate relations, subjective internal corporate circumstances. Common law countries have developed a system of good faith elements and special tests to apply the required requirement of good faith according to the context. A special place is given to fiduciary relations as a product of bona fides. The author has carried out a comparative analysis of the provisions of the Plenums of the Supreme Court of the Russian Federation, the Supreme Court of the Russian Federation and the law enforcement practice of Germany, the USA, Great Britain and Canada on the issues of good faith in the consideration of corporate disputes. Special attention is paid to the interrelation between corporate ethics and law. Examining a number of key cases from the law-enforcement practice of the courts of the Anglo-American system of law, the author substantiates the possibility of applying special tests, namely, objective and subjective good faith tests, to regulate matters related to the application of the rules of good faith from the Civil Code and special laws in dealing with corporate disputes. Special attention is paid to the role of courts and permissible discretion in the formation of standards of enforcement of blanket norms and general principles of law in corporate relations.

КОРПОРАТИВНІ ПРАВА В УКРАЇНСЬКОМУ ЗАКОНОДАВСТВІ: ПОНЯТТЯ ТА ЗМІСТ

Стаття присвячена розгляду понятійних засад корпоративних прав та з’ясуванню їх правової природи. У дослідженні робиться спроба розкрити їх поняття та визначити їх місце в системі права України. Для цього були вивчені законодавчі дефініції терміну «корпоративні права» та з’ясовані наукові підходи до його розуміння та тлумачення. Дослідження в такому ракурсі дозволило сформувати ряд висновків і пропозицій, спрямованих на вдосконалення корпоративного законодавства, які можуть бути підґрунтям для подальших наукових досліджень.

О проблемах корпоративных правоотношений в гражданском законодательстве Республики Таджикистан

In the framework of this article, when considering corporate legal relations, their civil-legal component is presumed, which is based on the part of the internal relations of a legal entity existing in corporate organizations, associated with participation in these organizations or management of them. In this regard, it is proposed to consider corporate law as a special institution of civil law, the rules of which regulate civil relations in corporate organizations or their management, arising primarily between the founders of a corporate organization, as well as between the corporate organization and its founders. At the same time, having analyzed the legal status of participants of intraorganizational corporate legal relations, it is noted that due to the lack of some of them the status of the subject of civil legal relations, not all non-prohibited by law intraorganizational corporate legal relations aimed at achieving both common interests and pursuing private individual interests of members of corporations can be civil legal relations.

Підстави виникнення, зміни та припинення корпоративних правовідносин

Підстави виникнення, зміни та припинення корпоративних правовідносин

Multivariability of Rights in the Structure of Corporate Legal Relations

The research is devoted to the study of the structure of corporate legal relations, establishing the mechanism of their formation. Legal relations as a form of social relations are in constant development due to the activity of social ties in society. As a result, new types of social interaction emerge and develop that require an appropriate legal form of ordering. Such ordering is self-regulated by the participants of the respective relations in the process of accumulation of property, non-property components, organizational and so on. The study found that the formation of corporate legal relations is the result of a combination of property, non-property and organizational components. The organizational component of corporate relations is to streamline the activities of individuals in the process of combining their efforts at the stage of emergence of such relationships, as well as to streamline this activity of participants in corporate relationships in the process of their implementation. It can be concluded that the proprietary nature of corporate legal relationships is conditioned by the material interest of the participants in such relationships to receive appropriate satisfaction from their participation in them. The corporation is managed through a non-property segment.