Bill “On joint stock companies and protection of shareholders’ rights” developed in Uzbekistan
The document has been developed in line with the order of the President of Uzbekistan from 14 January 2011.
The new bill is aimed at further developing corporate management system in Uzbekistan based on existing legal documents, increasing legal protection of shareholders, including minority shareholders, strengthening responsibility of executive bodies and control over joint stock companies, as well as ensuring information transparency of joint stock companies for shareholders and investors.
The document consists of 8 chapters and 114 articles. The law determines legal position, order of creating, activity, reorganizing and liquidating joint stock companies, rights and liabilities of shareholders, as well as measures n protecting their rights and interest, jurisdiction, order of formation and functioning of bodies of the joint stock companies, authority and elections of officials.
Creation and legal position of public companies in banking, investment and insurance sectors, as well as public companies with state share are regulated in line with the legislation of Uzbekistan.
Joint stock companies are business entities, charter capital of which is divided into set number of shares, which confirm liability rights of shareholders. The shareholders’ meeting, Supervisory Board and Executive body are main bodies of the joint stock company.
According to the bill, joint stock companies are legal entities and possess property, included to its balance, can purchase and carry out property and personal non-property rights, and undertake liability, etc.
Joint stock companies receive rights of legal entity from registration moment. The companies are created for unlimited term, if the legislation does not set other term.
Joint stock companies can carry out any activity, which are not banned in line with legislation and not shown in Constituent documents. Shareholders have right only indicate main activities of public company.
The minimal size of charter capital of joint stock companies should be US$400,000 in soums equivalent, calculated in line with the Central Bank exchange rate on registration date. At the same time, the bill said that the charter capital can be formed within a year from registration date.
The bill said that the charter capital can be increased through raising nominal value of shares or placing additional shares. Shareholders or Supervisory Council, if it holds such rights, can adopt decision on increasing charter capital.
The charter can be decreased through cutting nominal value or number of shares, or through re-purchase of shares. The joint stock companies should indicate in their charter that they have right re-purchase right.
The bill said that dividends are part of net income of the company, which is distributed among shareholders. The companies are obliged to pay dividends to all types of shares. Joint stock can be re-organized only in line with the decision of general shareholders’ meeting, the bill said.