Legislative amendments on the preemptive right to purchase shares in limited liability companies have been approved

The President of the Russian Federation has signed federal laws introducing systemic changes to corporate relations regulation in LLCs.

The President of the Russian Federation has endorsed two pivotal legislative acts detailing the mechanism for implementing pre-emptive share purchase rights in limited liability companies (LLCs). Approved documents aim to eliminate legal conflicts and establish uniform judicial practice in corporate relations.

Substance of Legislative Changes
The first signed law substantially amends Article 21 of the Federal Law “On Limited Liability Companies.” According to the revised text, pre-emptive share purchase provisions now apply exclusively to company participants for whom this right is expressly stipulated in the charter of the specific LLC. This provision specifically addresses cases involving pre-emptive rights of purchase during participant withdrawal from the company – previously a major source of legal disputes.

Concurrent modifications affect Article 93 of the Civil Code of the Russian Federation. The amendments establish a binding rule: company participants hold pre-emptive rights to acquire shares sold by other participants unless the organization’s charter specifies alternative procedures. This creates a unified legal framework for all share alienation cases – encompassing both participant withdrawal and third-party share sales.

Practical Implications of the Reform
The primary objective of these legislative changes is to resolve legal ambiguities repeatedly observed in judicial proceedings concerning violations of pre-emptive rights in LLCs. Imperfections in previous statutory language had led to inconsistent court rulings, complicating the protection of bona fide participants’ interests and undermining corporate stability.

The updated legal framework grants founders of limited liability companies significant flexibility in establishing internal share transfer regulations. Participants gain enhanced capacity to adapt corporate structures to evolving economic conditions while minimizing administrative barriers. This proves particularly valuable when rapid response to market shifts is essential, as the speed of executing share transactions directly impacts business competitiveness. An additional benefit involves reducing corporate conflicts and litigation previously arising from ambiguous interpretations of pre-emptive rights provisions.

Implementation Timeline and Preparatory Measures
The federal laws signed by the head of state take full effect on September 1, 2025. This transition period allows LLC participants and legal advisors sufficient time for preparatory actions, including:

• analysis of existing charters for compliance with new requirements;
• development of optimal pre-emptive rights implementation mechanisms;
• corresponding amendments to corporate documentation.

The legal community will need to establish model charter provisions that balance participant rights protection with managerial flexibility.

Key Aspects Summary:

• Charter supremacy over statutory default rules
• Unified regulations for different share alienation methods
• Enhanced predictability of corporate procedures
• Reduced litigation through explicit legislative criteria
• Streamlined business restructuring amid economic volatility