Important Reminders To Shareholders, Participants, And Heads Of Executive Bodies Of Legal Entities
- THE DECLARATION OF ULTIMATE BENEFICIAL OWNER
Every year, until February 20, all legal entities registered in Armenia should submit a declaration on ultimate beneficial owners on a mandatory basis (UBO declaration).
- The ultimate beneficial owner of a legal entity is an individual who:
- directly or indirectly owns 20 or more percent of the voting shares (shares, stakes) of the given legal entity or directly or indirectly has 20% or more participation in the legal entity's charter capital,
- exercises absolute (factual) control over the given legal entity by other means,
- Is an official person carrying out the general or current management of the activities of the given legal entity if the requirements of subparagraphs "a" and "b" of this clause are not met.
- The declaration on ultimate beneficial owners is submitted online via an electronic system run by the State Register of Legal Entities of the Ministry of Justice of of Armenia. The electronic system is available in Armenian via the following link.
- The following data are required to be specified in the declaration on ultimate beneficial owners :
- Details of the person submitting the declaration on behalf of the legal entity,
- Information on the listing of shares (if such is available),
- Details of the ultimate beneficial owners,
- The grounds for being an ultimate beneficial owner,
- Details of intermediate legal entities (if such available).
- The declaration on ultimate beneficial owners is submitted either by the head of the executive body of the legal entity or his/her authorized person.
- Within the framework of providing legal services to its clients, “TK & PARTNERS” law firm, among others, assists the clients in regard to the submission of the declaration on ultimate beneficial owners.
- In case of necessity to submit a declaration on ultimate beneficial owners on behalf of your Company, we would kindly request you to fill in the relevant information in the power of attorney provided as an Appendix of this alert and provide it to us by sending it to the following e-mail address: [email protected], indicating in the subject of the e-mail the name of the Company and the information specified in point 2 of this alert.
- Additionally, we would like to note that in case of failure to submit the declaration within the prescribed period and/or provision of inaccurate information in the declaration, an administrative liability may be applied in the means of issuance of a warning or an application of a fine in the amount from AMD 30,000 to AMD 100,000.
- CONVENING THE ANNUAL MEETING OF COMMERCIAL ORGANIZATIONS
- Pursuant to the legislation of Armenia, joint-stock companies and limited liability companies are obliged to hold an annual/general meeting of shareholders at least once a year.
- In a joint stock company, the annual meeting of shareholders is convened within a maximum of six months after the end of the Company's financial year, within the period established by the Articles of Association.
- The terms of the convening of the meeting of limited liability companies approving the annual results are established by the articles of association in a period of no earlier than two months after the end of the financial year and no later than six months later.
The following issues are included and discussed on the agenda of the annual meeting:
The annual meeting of shareholders of the Company considers and approves the following issues:
- Annual reports and balance sheets,
- profit and loss statement, profit and loss distribution,
- decision on the payment of annual dividends,
- the number of annual dividends.
Issues included in the agenda of the annual meeting, if necessary.
The annual meeting of shareholders of the Company, in addition to issues provided for by law for mandatory discussion, considers and approves the following issues, if such is necessary:
- Approval of the quantitative composition of the board, election of its members, early termination of their powers,
- Election of members of the audit commission (auditor) of the Company and early termination of their (his) powers.
- AUDIT OF FINANCIAL STATEMENTS
1. Entities and groups of entities whose annual financial statements are subject to publication are required to disclose them no later than June 30 of the year following the reporting period.
2. In accordance with relevant regulations, entities are required to make their financial reports publicly accessible by publishing them on their own website and on one of the following platforms: the official website of public notices of the Republic of Armenia (http://www.azdarar.am) or the official website of a mass media outlet registered in Armenia. Additionally, these reports must be retained at the designated publication location for a minimum period of 5 years.
3. Mandatory audit is required for entities or groups of entities that, as of the end of the reporting year, exceed the threshold in at least two of the following three indicators:
- Total assets on the balance sheet (statement of financial position): AMD 2 billion or more,
- Gross revenue generated by the entity or the group of entities: Minimum of AMD 4 billion
- Average annual number of employees employed by the entity or the group of entities: At least 100.
NOTICE: The ideas presented herein are for informational purposes only and do not constitute legal counsel. While valid as of this publication date, they are subject to change in the future. We assume no obligation to update this document in the event of such changes.
Վարուժան Ավետիքյան / Varoujan Avedikian Կառավարող գործընկեր, փաստաբան/ Managing Partner, Attorney-at-Law
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Մարիամ Դովլաթյան / Mariam Dovlatyan Իրավախորհրդատու, փաստաբան / Associate, Attorney-at-Law |