Legal analysis of incorporation documents

Contents:

• Constituent documents of commercial organizations
• Constituent documents of non-profit organizations
• When a legal analysis of constituent documents is needed
• Our services

According to Article 52 of the Civil Code of the Russian Federation, legal entities act on the basis of the charter, which is approved by their founders (participants). The Charter of commercial corporations (JSC or LLC) is the main document regulating their activities. The charter also contains basic data about the company, thanks to which its identification is possible. The founders of the company can also draw up a constituent agreement regulating the establishment of the enterprise.

Some types of organizations may act on the basis of other constituent documents. For example, a constituent agreement is mandatory for business partnerships. And a state corporation does not require such documents – it carries out its activities on the basis of a federal law adopted in relation to a specific state corporation.

Constituent documents of commercial organizations

The main constituent document of commercial legal entities is the charter. It is impossible to carry out activities without the charter. Legal entities can act on the basis of a standard charter (choose among 36 possible options) approved by an authorized state body. At the same time, information that a person acts on the basis of a standard charter must be indicated in the unified State Register of Legal Entities (USRLE). It is also possible for the founders of the company to independently develop the charter.

If desired or required by law, for example, for business partnerships, the founders of the company can also draw up a foundation agreement (in relation to LLC – an establishment agreement). In the establishment agreement, the founders undertake to create a legal entity, determine the procedure for joint activities to create it, the conditions for transferring their property to it and participating in its activities.

The contract also defines the conditions and procedure for the distribution of profits and losses between the participants, the management of the activities of a legal entity, the withdrawal of the founders (participants) from its composition.

Founding documents of non-profit organizations

For non–profit organizations, the following constituent documentation is provided:

• charter – for a public organization, foundation, non-profit partnership, autonomous non-profit organization, private and budgetary institution;
• regulations approved by the relevant body exercising the functions and powers of the founder – for state-owned institutions;
• the founding agreement concluded by the members of the union or association, and the charter approved by them.

Also, depending on the type of non-profit organization, the law defines certain requirements for the content of the charter. For example, the foundation’s charter, in addition to basic information, should contain information about the foundation’s bodies, including the board of Trustees, and the procedure for their formation.

When a legal analysis of constituent documents is needed

It is recommended to carry out this procedure even before submitting registration documents to tax and other authorities. At the stage of registration of a legal entity or a joint-stock company, any mistakes made and even grammatical inaccuracies may become the reason for refusal.

Also, the legal analysis of the constituent documents will help to identify serious shortcomings in the documents of already registered enterprises. Errors and inconsistencies in the securities may lead to the fact that a legal entity, LLC or JSC will not be able to get a loan, participate in tenders or even sign contracts and make settlements with partners.

In addition, inaccuracies can cause conflicts between the company’s partners and lead to litigation and other undesirable consequences. For these reasons, the constituent documentation must necessarily be compiled by competent professionals.

Our services

VALEN has many years of experience in the field of corporate law. Our lawyers specialize in the preparation and legal analysis of constituent documents. We will consult on all issues related to the preparation of constituent documents, conduct a thorough analysis and identify errors in the documents, prepare written recommendations for their improvement or prepare new constituent documents on a turnkey basis.

We offer the following services:

• consultation of specialists and analysis of documents;
• drafting of constituent agreements, charters, regulations;
• preparation of complaints, claims, statements;
• participation in negotiations;
• representation of interests in state bodies.