On 29 December 2012 the President signed Federal Law No. 282-FZ amending certain legislative acts of the Russian Federation.

Aiming to improve the procedure for the issuance of securities and the protection of shareholders’ rights, the Law amends several federal laws such as: “On the Joint Stock Companies,” “On the Securities Market,” “On Banking and Banking Activities,” the Tax Code and certain other legislative acts.

The amendments to the Securities Market Law mainly touch upon the procedure for the issuance of securities. In particular, they specify the exhaustive list of circumstances in which no state registration of a securities prospectus is required (in all other cases state registration is required). Also, the amendments concern the disclosure of information, the terms and procedures for payments on the securities, and the registration and exercise of the rights thereto. It is expected that the amendments will allow issuers to reduce the time and costs associated with the issuance and circulation of securities, and will lower administrative barriers for Russian issuers and build up the confidence of Russian and foreign investors in the Russian stock market.

The JSC Law has been amended to, among other things, include the following:

Charter capital increase

The JSC Law previously provided that the decision to increase charter capital by placing additional shares must include, among other things, an indication of the placement price of additional shares or the method for the determination thereof. According to the amendments, instead of an indication of price, the relevant decision may provide that the company’s board of directors set a placement price (or a method for its determination) before the company starts placing additional shares.

General shareholders’ meeting competency

The competency of a general shareholders’ meeting has been supplemented to include the power to decide on an application for the listing or delisting of the company’s shares and/or securities convertible into shares. The decision to apply for delisting requires a ѕ majority of the votes of shareholders owning the voting shares and participating in the general shareholders’ meeting, and is grounds for the shareholders who have voted against such decision or have not participated in the voting to request that the company buy out their shares. Such decision shall enter into force if the total amount of funds which is to be used to buy out the shares from the shareholders does not exceed ten percent of the value of the company’s net assets as at the date of such decision.

The rights of the shareholders owning preferred shares

The amendments establish an additional circumstance in which shareholders owning preferred shares of a particular type may acquire the right to vote at a general shareholders’ meeting. It occurs when the meeting is to decide whether or not to apply for the listing or delisting of shares of this type. Such decision is to be made by no less than ѕ of the votes of the shareholders owning the voting shares and participating in such general shareholders’ meeting, except for the votes of shareholders owning preferred shares of such type, and by ѕ of the votes of all shareholders owning preferred shares of such type (if the company’s charter does not provide for a higher threshold for making such decision).

Conversion of preferred shares

According to