The RA Government session took place

08 April, 2021

On April 8, 2021, during the session of the RA Government, the executive approved the draft laws of the Republic of Armenia on making amendments and addenda to the RA Law on “Joint stock companies” and a number of related laws.

With the demand to improve the country’s business environment and harmonize the legal regulations of corporate relations with modern requirements, the draft proposes to enable the shareholder owning 95% and more voting shares of the company to acquire the rest of the voting shares belonging to other shareholders of the company at the price specified in the respective request. At the same time, small shareholders owning up to 5% of the voting shares of the company are given the opportunity to claim from the major shareholder owning 95% and more voting shares of the company to buy their shares and release them from the company. Systemic changes are envisaged that are related to the possibility of envisaging classes of simple (ordinary) and privileged types of shares and the rights deriving from them. In particular, the proposed changes are intended to enable companies and their shareholders, if they wish so, to define by their charter classes of ordinary shares with corresponding differentiated rights, including the right to grant more than one vote to holders of such shares.

It is also proposed to reserve the decision-making authority on concluding a major transaction only to the assembly, whereas on other transactions related to acquisition or alienation of the company’s property a separate chapter is proposed, which offers the opportunity to delegate the authority of concluding such transactions not only to the company’s board of directors, but their executive bodies as well, in the cases defined by the company’s charter. As a result, companies wishing to delegate more powers to their executive bodies will have the opportunity to do so in the cases stipulated by the company’s charter. The bills envisage eliminating the condition of a three-year term for issuing bonds without collateral and introducing other solutions aimed at modern regulation of corporate relations. As a result, it is expected to create an opportunity for both local and foreign investors to finance companies more effectively through both debt and equity, create additional tools to protect the interests of small shareholders, while maintaining a balance between the interests of small and large shareholders, envisage opportunities to apply flexibility in the company’s management processes, personalized approaches for investors and shareholders of each type and category. The draft laws were considered urgent and will be submitted to the National Assembly pursuant to the established procedure.

The executive approved applications of a number of companies to use the privilege of customs duties exemption within the framework of investment programs implemented in the priority sector.

“Kapavor” LLC will use imported goods for asphalt production (implementation of road construction works). It is envisaged to invest 380.6 million drams within the framework of the program for equipment acquisition. There are currently about 312 jobs. As a result, 10-15 new jobs will be created with an average salary of 180,000-220,000 drams. The total volume of products envisaged by the program will make 1.5-2 billion drams, which will be fully sold in the territory of the Republic of Armenia and Republic of Artsakh. The value of goods submitted to receive the privilege is 380.6 million drams. The amount of the customs duties exemption is 19 million drams.

“ML Mining” company, operating since 2003, is engaged in mining activities in Kotayk Marz of the Republic of Armenia. The company has already invested about 8 billion drams, and within the program framework will invest another 4 billion drams. At present there are about 320 jobs, and additionally 40-60 new jobs will be created with an average salary of 200,000-300,000 drams. The total volume of products envisaged by the program will make 200 million drams per year, which will be fully sold in the territory of the Republic of Armenia. The value of goods submitted to receive the privilege is 3.6 billion drams. The amount of the customs duties exemption is 311 million drams.

“Rock Berry” company will use imported goods for construction of strawberry production greenhouses on 3 hectares of production area (Kotayk Marz). According to 2018 decision, the company received a privilege for customs duties exemption, and invested 3 billion drams and created 149 new jobs within the program framework. It is planned to make an annual investment of 2.6 billion drams within the program framework. It is planned to create 70 new jobs with an average salary of 200,000 drams within this investment program. The annual volume of products envisaged by the program will be 1.5 billion drams per year, of which 76.2 million drams will be sold in the territory of the Republic of Armenia, while 1.4 billion drams in the territory of other EEU member states. The value of goods submitted to receive the privilege is 1.7 billion drams. The amount of the customs duties exemption is 87.7 million drams.

“Betonagorts” CJSC will use imported goods for production of metal-plastic windows, doors, window sills, window frames (Yerevan). It is planned to invest 2.2 billion drams. At present there are about 13 jobs, and additionally 4-6 new jobs will be created with an average salary of 150,000-200,000 drams. The total volume of products envisaged by the program will make 3.1 billion drams, which will be fully sold in the territory of the Republic of Armenia. The value of goods submitted to receive the privilege is 2.2 billion drams. The amount of the customs duties exemption is 149.4 million drams ...

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