Net Assets of Companies: New Aspects of Legal Regulation

    May 2010

    Russian law contains provisions whereby net assets of companies should not be lower than the amount of the charter capital of such company. If this occurs, then the company must decrease its charter capital or wind itself up.

    In late 2009 a new law was adopted. Among other changes, this law includes changes in the necessary ratio between net assets and charter capital.

    This Russian-language article addresses key changes introduced by this law into the regulation of the amount of net assets, in particular, new disclosure requirements with regard to the amount of net assets and new procedures for decreasing the charter capital in the event that net assets become lower.

    The article is published with permission of Mergers & Acquisitions.