Liquidation of a PJSC: how the procedure is organized, main stages

Contents:

• Legislative changes since 2014
• Resolution on liquidation of a PJSC
• Liquidation of a JSC (“PJSC”): required documents
• Public joint stock company: voluntary liquidation
• Liquidation of a public joint stock company: the role of a lawyer in the process

PJSC (formerly OJSC) is a public joint-stock company, the shares of which are distributed among citizens and other companies. Public says that the shares are freely rotating on the stock market, which makes them available for purchase by any person.

PJSC is creates, reorganizes and liquidates on the basis of the legislation of the Russian Federation and the Charter of the organization. In this article, we will consider the process of liquidation of a PJSC and its main stages.

Legislative changes since 2014

This year, amendments to Federal Law No. 208-FZ “On Joint Stock Companies” came into force. The change of the term “open joint-stock company” to “public joint-stock company” in the legislation was made in order to clarify and unify the concepts. In essence, a public joint-stock company is the same open joint-stock company, but with a more precise definition of its features and characteristics. The term “public” indicates that the company’s shares are intended for open sale on the securities market.

A PJSC differs from a non-public joint stock company in that its shares can be freely tradable and sold to any interested parties. Thus, a public joint stock company has greater openness and accessibility to investors and the public at large.

The change of the term does not introduce any significant changes in the essence and legal status of this legal entity. It is just a nuance that helps to define more precisely the type of joint stock company within the framework of the legislation.

Resolution on liquidation of a PJSC

The procedure for making resolutions at general meetings of stockholders is an important moment in the life of a public joint-stock company. One of such resolutions may be the liquidation of the company itself.

Organization of the general meeting of stockholders: the general meeting of stockholders is the supreme management body of a public joint-stock company. It is convened to make important resolutions, including the liquidation of the company. The general meeting consists of shareholders who have the right to vote. All shareholders must be notified 30 days prior to the date of the meeting in order for it to be held.

The resolution on the liquidation of an open joint-stock company is adopted at the general meeting of stockholders. The procedure for taking a resolution at the general meeting on liquidation of an open joint stock company consists of several stages:

Preparation of documentation. In order to hold a meeting of shareholders, it is necessary to prepare a notice of the meeting, the agenda and materials for consideration. The agenda should include the issue of liquidation of the company.

Convening the meeting. A notice of the meeting must be sent to all stockholders at least 30 days prior to the date of the meeting. The notice must contain information about the date, time and place of the meeting and a reference to the materials to be considered.

Proceedings of the meeting. At the meeting, the stockholders shall consider the issue of liquidation of the company. The resolution shall be passed by a simple majority of votes of the shareholders present, unless otherwise provided for in the company’s articles of association

Signing and certifying all copies of the minutes. This is important so that each stockholder has written confirmation of the decision made.

Liquidation of a JSC (“PJSC”): required documents

Documents for liquidation of a PJSC include an impressive list, among the main ones:

• Articles of Association of PJSC
• Certificates of registration with the Federal Tax Service, PFR and FSS (Social Insurance Fund)
• Extract from the Unified State Register of Legal Entities
• Personal data of each stockholder
• Activity codes data of the joint-stock company, as well as other documents depending on the specific case
• Original constituent documents
• Minutes of the decision to liquidate the company
• Notification by placing information in mass media
• Certificate from statistical authorities
• Original certificates from the PFR, FSS (Social Insurance Fund) and FTS on deregistration.
• Original certificate from the employment center
• Original bank statements on closing of accounts
• Act on division of property
• Original certificate from an archival institution confirming the transfer of the company’s documentation for storage
• Auditor’s report

Public joint stock company: voluntary liquidation

Voluntary liquidation of a joint stock company implies two important conditions:

• The company may not be liquidated through merger or consolidation
• The decision on liquidation is made at the general meeting of stockholders on the basis of at least 75% of votes of the total number of participants

Minutes on liquidation of PJSC and liquidation balance sheets are approved at the general meeting of stockholders, who must be notified:

• 30 days – before the date of the meeting, the purpose of which is to sign the minutes on the liquidation of the company
• 20 days prior to the date of the meeting for the purpose of signing the balance sheets

As we noted above, the decision on liquidation is made at the general meeting. Stockholders will be faced with the tasks of:

• Counting the assets and finances equivalent to the value of the property, on their basis the members of the commission draw up an interim balance sheet of the economic activity of the company
• Establishing the existence and size of the debts of the joint stock company, determining the deadlines for accepting applications from creditors for the fulfillment of debt obligations
• Sale of the company’s assets, repayment of debts with the proceeds from the sale of assets
• Determination of the final liquidation balance sheet
• Dismissal of employees on the employer’s initiative
• Closing of the company’s bank accounts
• Transfer of documents (minutes and resolution of the general meeting of shareholders) to the registering authority for removal of the liquidated PJSC from the list of companies

Liquidation of a public joint stock company: the role of a lawyer in the process

When liquidating a public joint stock company, a lawyer plays an important role and is necessary for the implementation of legal procedures related to the closure of the company. Liquidation of PJSC is a complex and complicated process that requires the precise knowledge and experience of a legal professional.

The initial task of a lawyer in the liquidation of PJSC – to carry out all the preparatory work necessary to start the procedure. This includes the analysis of the organizational-legal form of the organization, drawing up its charter, as well as the study and conclusion of the current legislative norms and requirements governing the process.

Further, at the stage of liquidation, the lawyer is engaged in the preparation and execution of the necessary documents, including applications, protocols, certificates and others. He also monitors compliance with all terms and conditions stipulated by the legislation.

The lawyer pays special attention to problems related to the obligations of the company to creditors and counterparties, as well as the rights and interests of employees of the PJSC. He helps to develop and agree on a liquidation plan, including settlements with creditors and determining the procedure and structure of payments to employees.

In parallel, the lawyer represents the interests of PJSC in interaction with state authorities, banks, controlling bodies and auditors. He participates in negotiations and signs necessary documents on behalf of the company.

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