Limited Liability Company (OOO)
"OOO" is the most popular form of business in Russia. In some aspects it is very similar to American LLC. It is a legal entity which authorized capital is divided into shares, which are similar to LLC shares, but may not be bought and sold at stock exchange. Members of such company bear only the risk of loss of their investments.
OOO enjoys full legal capacity. In some special cases OOO requires a license to perform certain activities. Such activities are specially stipulated by the Russian legislation. Name of the Company must be in Russian. In addition it may be in any foreign language. Name of the Company must reflect the sphere of its activities. Name should also contain abbreviation "OOO". There are some limitations on the use of such words as "Moscow", "Russia", "the Russian Federation" and "Federal" – to use them the Company should acquire special permission.
The initial member of OOO may be a person, who pays the authorized capital of the Company. At the same time number of the members of OOO may not exceed 50 persons. The minimal authorized capital is 10,000 Russian rubles. At least 50% of the capital (5,000) must be paid out prior to the registration of the Company; the other half may be paid out during the first year of the Company' life.
The Company is managed by the General Director (performs everyday management) and the General MembersРІР‚в„ў meeting (decides the most significant matters of Company management). The Company should have its own seal, registered at the Moscow Registration Chamber. The Company should file for registration to the following authorities: Tax inspection, the Statistics Committee, the Pensions Fund, the Social Security Fund and the Medical insurance Fund. Accounting reports must be filed to the Russian tax authorities in Russian rubles. The Company should also file reports to the authorities where it is registered.
Open Joint Stock Company (OAO)
A Joint Stock Company is a Company organized by one or more persons with its authorized capital divided into shares of certain value. OAO shares may freely circulate on stock exchange. Shareholders bear only the risk of loss of their investments represented by shares. OAO shares may be bought and sold without prior consent of other shareholders and OAO may offer its shares to public. OAO is required to publish its annual reports, balance sheet and profit-and-loss statement (in Russian).
OAO may be established by one person (physical or juridical). There is no legal limitation on the maximal number of Initial members.
OAO name is subject to the same requirements as OOO name. The only difference is that it should contain abbreviation "OAO".
Initial Members must form the authorized capital of the Company to guarantee the interests of its creditors. The minimal amount of the capital is 100,000 rubles. The capital is divided into shares of certain value (determined by the Initial Members). Initially shares may be paid with money or different kinds of property or non-property rights which have monetary evaluation. 50 % of the authorized capital may be paid out within three months from the date of state registration of the Company, the other 50 % – within first year of the Company' life. State registration of OAO is carried out by tax authorities. OAO should perform registration in the Statistics Committee and State Funds (Pensions Fund, Social Insurance Fund and Medical Fund). The stock should be registered by the Federal Commission for Securities Market of Russia.
Closed Joint Stock Company (3AO)
In many aspects 3AO is similar to OAO. The following features of 3AO allow to distinguish it from OAO:
- The number of 3AO participants may not exceed 50 otherwise it must convert to OAO;
- 3AO shares are not allowed to be offered to the public and are to be distributed only among the Initial Members or other persons specifically named at the beginning of the registration procedure;
- Consent of other shareholders is required to sell 3AO shares. The remaining shareholders possess the right of priority to buy shares offered for sale by one of the shareholders;
- Name of 3AO should contain abbreviation "3AO";
- Minimal authorized capital is 10,000 rubles (against 100,000 rubles for OAO)
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