The State Duma has adopted in the first reading a bill on the grounds for the retirement of members of boards of directors.

The bill is designed to clarify the circumstances in the presence of which a member of the board of directors (supervisory board) of business companies will be deemed to have retired.

Such grounds will be:

  • death;
  • entry into force of a judicial act recognizing a member as incapable, limited in capacity, missing or declared dead;
  • entry into force of a guilty verdict on imposition of punishment in the form of deprivation of the right to hold certain positions or engage in certain activities or administrative punishment in the form of disqualification;
  • completion of the procedure of property realization or termination of bankruptcy proceedings in the course of such procedure, extrajudicial bankruptcy procedure;
  • written notification of relinquishment of his powers;
  • other cases stipulated by the federal law.

In addition, the proposed amendments would exclude from a number of norms in the JSC Law a reference to the fact that the votes of retired members of the Board of Directors are not taken into account when voting on a number of issues. For example, the corresponding instruction is excluded from the norm on increase of the authorized capital through placement of additional shares or issue of convertible securities.

Link: https://sozd.duma.gov.ru/bill/724347-8

Bill No. 724347-8