On March 30, 2015, the President of the Russian Federation signed Federal Law No.67 “On amending certain legislative acts of the Russian Federation as pertains to ensuring authenticity of information provided in the course of state registration of legal entities and individual entrepreneurs” (hereinafter “Law No.67”) aimed at ensuring authenticity of information introduced into the Unified State Register of Legal Entities (hereinafter the “EGRUL”), as well as toughening the liability for violations in the state registration of legal entities.

1.        Smile, you are on candid camera…

Starting from July 1, 2015, the notary’s powers on identifying the person applying for notarization will be substantially expanded. Now, for this purpose the notaries will be able to use the information resources of the Federal Migration Service, as well as to query directly the authority that issued the personal ID documents. Furthermore, the notary will be entitled to use video recording when performing notary services and store the respective video materials in the manner established by the Federal Notarial Chamber.

2.      Show your documents…

Starting from July 1, 2015, the notary will be able to accept electronic documents, and the requirements for documents submitted by the applicant for notarizations have been clarified.

In particular, Law No.67 establishes that documents made in hard copies must not have any corrections, crossed out words or erasures, and must be easily readable. However, the notary is entitled to accept documents with corrections if they do not hold additional information and do not affect the essence of the document.

3.      Any whim at your own expense…

Starting from January 1, 2016, notaries will be entitled to obtain information from the EGRUL and the Unified State Register of Individual Entrepreneurs for the purposes of notarization, as well as to submit documents related to the state registration of legal entities and individual entrepreneurs to the registering authority in electronic form. The cost of such notarial service will constitute one thousand rubles.

4.      “Who framed Roger Rabbit”…

Law No.67 also amends the Criminal Code of the Russian Federation. Specifically, starting from March 30, 2015 the Russian Criminal Code establishes criminal liability for providing to the registration authority data that leads to entering information on front men into the EGRUL. In this context, “front men” means 1) persons who are founders/participants of a legal entity and on whom information is entered into the EGRUL through deceit or without their knowledge, as well as 2) persons elected/appointed as members of the management bodies of a legal entity, without the goal of actual management of the legal entity.

5.      A notary is a must…

Starting from January 1, 2016, the decisions of general meetings of participants of a limited liability company (hereinafter “OOO”) on increasing the charter capital will be subject to mandatory notarization (except when decisions are made by the sole participant of an OOO).

The following will also be subject to mandatory notarization: 1) transactions on pledging a share (or part of a share) in the charter capital of an OOO, 2) offers of an OOO participant wishing to sell its share to a third party, 3) applications of an OOO participant on withdrawal from an OOO.

Furthermore, now after certification of a transaction aimed at alienation of a share (or part of a share) in the charter capital of an OOO, the application to the registration authority on introducing the respective amendment into the EGRUL must be signed by the notary and not the seller of the share (or part of share) as before.

6.      “Doubt impedes success” (Bion)

Starting from January 1, 2016, the registration authority will be entitled to initiate a check of information entered into the EGRUL in the event of doubts as to the validity of information entered or to be entered into the EGRUL. In particular, the registration authority will be entitled to require from a legal entity additional documents, certificates or explanations on the issues arising in the course of the check, engage specialists or experts for participation in the check and performing an inspection of the real estate of a legal entity. An objection in relation to the information submitted to the registration authority, sent to the authority by any interested entity, can become grounds for conducting a check.

For the period of the check, the procedure of state registration is to be suspended.

7.      “Moving is worse than a fire”…

Starting from January 1, 2016, the procedure for changing the address of a legal entity will be more complicated. Law No.67 establishes two stages for registering the change of a legal entity’s address: (1) registration of the legal entity’s intent to change the address, and (2) registration of the address change.

That provided, the first stage of the procedure will be performed by the registration authority at the previous location of the legal entity, and the second by the authority at the new location and no earlier than 20 days after the first stage. Considering the two stages, the timeframes for registering a change of legal address will constitute no less than one month according to preliminary assessment.

Anastasia Fomicheva   Senior Associate   St. Petersburg    afomicheva@cls.ru   Tel.: +7 (812) 346 79 90

Anna Chaykina   Associate    St. Petersburg       Tel.: +7 (812) 346 79 90

Additional notes

Should any questions arise in connection with the above or if you need any additional materials, please contact Anastasia Fomicheva  or Anna Chaykina , St. Petersburg Office of Capital Legal Services.

This Information letter keeps the clients of Capital Legal Services and other interested parties abreast of information that may, to any extent, affect their activity or cater to their particular interests. The opinions and commentaries expressed in this information letter shall not be deemed as legal opinions and do not cancel the need to obtain legal advice or legal opinion on separate issues.