General Principles of Company Law for Transition Economies (Russian Version)

49 Pages Posted: 26 Sep 1998

See all articles by Bernard S. Black

Bernard S. Black

Northwestern University - Pritzker School of Law

Gainan Avilov

Government of the Russian Federation - Institute for Legislation and Comparative Law

Dominique Carreau

University of Paris

Oksana Kozyr

Research Center for Private Law, Russian Federation

Stilpon Nestor

Organization for Economic Co-Operation and Development (OECD) - Corporate Affairs Division

Sarah Reynolds

SJ Reynolds Associates

Abstract

1. This document sets forth proposed principles for a legislation on stock companies that are considered to be appropriate for a country making the transition from a centrally planned economy to a market economy. For each, views on the topic are explained and alternative approaches considered. The approaches currently used in three OECD economies - France, Germany, and the United States - are summarised, as well as those existing in the Russian Federation, a transition economy that has recently adopted a modern company law.

2. The focus of this exercise is company law, i.e. legislation that regulates commercial organizations with limited liability and investments represented by shares: corporations in the US, aktiengesellschaften in Germany, societes anonymes in France, joint stock companies in Russia. Although legislation on joint stock companies is the object of primary focus, all countries will need to have legislation providing for other types of business organisations. This will not be discussed here however, except when their provisions are relevant to the assumptions underlying this document. It is nevertheless important to note that the legislation should exhaustively list all available forms of legal entities, and that registration procedures should ensure a clear identification of every registered legal entity. This is mainly because improper formation of a legal entity might have dire consequences for both investors and third parties.

3. The discussion of company law principles in this document is based on an assumption of a civil law environment, i.e. the existence of a general civil code. Excluded from consideration are laws regulating securities exchanges and the rules for the general offering of securities to the public. It should however be noted that sometimes the boundaries between company and securities laws are blurred. Some countries will choose to regulate certain issues related to publicly-quoted companies and their shareholders through securities regulation while others include such provisions in the general company legislation. The principles that are discussed here and address these grey-area issues can be applied in either context. Regulations of the general relationship between stock companies and their employees, and special rules designed to handle the specific issues that arise for financial and industrial groups are also not discussed here. Finally, while the document considers the civil remedies for violation of the company law, it does not address criminal law issues related to stock companies and their behaviour.

Published in English and Russian in: 24 Journal of Corporation Law 190-293 (1999); Stanford Law School, John M. Olin Program in Law and Economics Working Paper No. 165; Columbia Law School, Center for Law and Economic Studies Working Paper No. 138

This paper is available in Russian (below) and in English at: http://ssrn.com/abstract=126539

JEL Classification: G18, G38, K22, P21

Suggested Citation

Black, Bernard S. and Avilov, Gainan and Carreau, Dominique and Kozyr, Oksana and Nestor, Stilpon and Reynolds, Sarah, General Principles of Company Law for Transition Economies (Russian Version). As published in Journal of Corporation Law, Vol. 24, pp. 190-293, 1999, Available at SSRN: https://ssrn.com/abstract=127208 or http://dx.doi.org/10.2139/ssrn.127208

Bernard S. Black (Contact Author)

Northwestern University - Pritzker School of Law ( email )

375 E. Chicago Ave
Chicago, IL 60611
United States
312-503-2784 (Phone)

Gainan Avilov

Government of the Russian Federation - Institute for Legislation and Comparative Law

Bolshaya Ceremushkinskaya 34
Moscow, Moscow 117218
Russia

Dominique Carreau

University of Paris

61 avenue du General de Gaulle
Creteil cedex, 94010
France

Oksana Kozyr

Research Center for Private Law, Russian Federation

Moscow
Russia

Stilpon Nestor

Organization for Economic Co-Operation and Development (OECD) - Corporate Affairs Division ( email )

Paris
France

Sarah Reynolds

SJ Reynolds Associates ( email )

265 Marlboro Road
Sudbury, MA 01776
United States

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