Transformation of an enterprise into a public joint-stock company (PJSC)

Contents:

• Features of the transformation of a public joint stock company
• Conversion order
• What activities are needed?

Transformation of a limited liability company (LLC) into a joint stock company (JSC) is a procedure for changing the legal form of a company. Thus, the new organization will fall under the law “On Joint Stock Companies”. In this article we will describe in detail how to correctly carry out such a reorganization.

Features of the transformation of a public joint stock company

First, it is important to note that the owner is not required to notify creditors of such a conversion. The reasons for making a decision to reorganize may vary. But most often the decision is made to attract additional financing through the sale of shares of the new PJSC.

Of course, management and reporting in an LLC is simpler than in a JSC. However, PJSCs enjoy great trust among the business community. This is undoubtedly important if the company seeks to reach new heights and begin cooperation with large clients.

It is important to understand that it will not be possible to directly transfer an LLC to a PJSC. An LLC can only be transformed into a non-public joint stock company – a non-public joint stock company. To transfer to a PJSC, you must first become a non-public company. Accordingly, this is the first step of all work.

Conversion order

The reorganization includes several stages:

1. Decision making

The reorganization begins with the decision to carry out the procedure. It is accepted by the founders (participants) of the company. The fact is recorded at the general meeting of owners, where the decision is approved. It is important that the reorganization of an LLC requires a unanimous decision of the participants, which is stipulated in paragraph 8 of Article 37 of the Federal Law “On Limited Liability Companies”. The Federal Law sets out key issues for discussion, including determining the procedure and conditions for reorganization, as well as the process of exchanging participation interests for shares in the event of transformation into a joint-stock company (JSC).

The reorganization process also includes the preparation and approval of a new charter of the joint-stock company. In addition, the meeting of participants is obliged to prepare inventories and acts. To avoid future problems with the Federal Tax Service, it is advisable to voluntarily reconcile calculations with the tax authorities for previous periods. The final decision based on the results of the discussions is formalized in a protocol, which is signed by the chairman and secretary of the meeting or the sole participant of the LLC. It is important to understand that this process cannot be compared with privatization.

2. Submitting a notification to the Federal Tax Service at the place of registration of the company

The notification must be sent within three working days after the decision to change the legal form is made. For this, form P12003 is used. After submitting the notification, the tax authorities enter information about the change in the status of the legal entity into the Unified State Register of Legal Entities within a month, after which the LLC receives a new extract from the register.

An important step is entering a notice of reorganization into the Unified Federal Register of Information on the Facts of the Activities of Legal Entities. This must be done within the same period as submitting the notification to the Federal Tax Service. The document can also be sent through the Fedresurs website or issued by a notary. For ignoring the obligation, liability is provided in the form of a fine of 5,000 rubles.

3. Providing information about insured employees to the Financial Markets Service after official registration of the start of the reorganization procedure.

4. Registration of share issue

This stage involves using the reorganization decision as a basis for issuing shares. A set of documents must be submitted before the official registration of the new PJSC. The document can be submitted to the financial market admission department or to a regional branch of the Bank of Russia. Documents are provided to the department if the authorized capital of the joint-stock company is equal to or exceeds 5 billion rubles or if the reorganized issuer of the LLC and the securities are issued through the department.

5. Registration of PJSC

Documents for registration are submitted no earlier than three months from the date of entry into the Unified State Register of Legal Entities about the beginning of the reorganization procedure. After completing the registration of the PJSC, it is necessary to transfer the register of shareholders to the registrar and register a report on the results of the issue of shares.

What activities are needed?

• Inventory of assets, including financial resources, intangible assets, real estate and liabilities to third parties
• Creation of a draft charter for a future joint-stock company that meets all the requirements of the legislation of the Russian Federation
• Holding a meeting of founders to make a decision on the transformation and approve the draft charter
• Sending official notification to the tax office that the conversion process has begun.
• Publication in the Federal Resource and “Bulletin of State Registration”
• Registration of a new organization: the last stage is the registration of a new joint stock company with the tax service.

A specific feature of the transformation of an LLC into a PJSC is the obligation to have an authorized capital of the new company of at least 100,000 rubles. There is also a need to register the issue of shares and transfer the register of shareholders to the registrar. The large number of procedures and documents makes the conversion process complex and requires careful compliance with the law.

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