New rules for changing company’s general director in the Unified State Register of Legal Entities
A new law came into force in September 2024, which radically changes the procedure for changing the head in the Unified State Register of Legal Entities. The key role in this process is now played by a notary, who is called upon not only to certify the decision on the choice of the general director, but also to shield against fraudulent schemes.
How does the new system work?
Previously, to change the general director of an LLC, it was enough to draw up the minutes of the meeting of participants and submit it to the tax office. This created loopholes for attackers – by forging the minutes, they “appointed” their people to the position of general director and gained access to the company’s accounts.
According to the new law, the resolution to change the general director must be certified by a notary. Before signing, the notary conducts a thorough check:
- Whether the participants with the right to vote came to the meeting
- Whether there is a quorum
- The correctness of the vote count
- Violation of the interests of the participants
- Competence of the company’s management body
- The powers of the organizer and participants of the meeting
What is the benefit of the innovations?
The introduction of notarization of the decision to change the general director is a step aimed at minimizing the risks of violations:
- Protection against falsification of minutes – now it is almost impossible to forge a document.
- Guarantee of the legality of the process – notarization confirms that the procedure for changing the head was carried out in accordance with the law.
- Reducing the opportunity for fraudsters – it is almost impossible to forge a decision to change the general director without going to notary.
Transparency and speed
In addition to improving security, the new system ensures transparency and speed of the procedure:
- The notary sends an application for changes to the Unified State Register of Legal Entities in electronic form, which helps speed up the registration process.
- Information about the change of the director can be obtained in the public domain, thereby increasing the transparency of the companies’ activities.
The introduction of a new procedure for changing the director in the Unified State Register of Legal Entities is a serious step aimed at protecting businesses from fraudulent schemes and creating a transparent and safe environment for doing business in Russia.