How the law protects the rights of shareholders

The model of protection of shareholder rights, applied in the Law of Ukraine "On joint-stock company" built on the principle of the predominance of procedural methods to protect the interests of shareholders, pre-empt such violations. Therefore, the categorical prohibitions and restrictions of the law contains very little. This allows for balancing protection of the interests of shareholders with the flexibility of decision-making management company. At the same time, many provisions of the Law of Ukraine "On joint-stock companies" to protect society itself from attempts to corporate blackmail, which is known to be frequently used approach in principle shareholder who abuses his power. For example, according to article 50 of the Law of Ukraine "On joint-stock companies' shareholders can challenge the decision of the general meeting of shareholders only for 3 months from the date of its adoption. But, among the provisions of the Act, which pose significant difficulties to shareholders in exercising their rights, and, importantly, highly relevant today, should include provisions Article 20 of the Act, under which all shares of the company exist in uncertificated form. It would seem - what's the conflict? But because of the transitional provisions of the law until the end of October this year, all of society should give its statutes in line with the law in the country actively begun the process of transfer of shares in uncertificated form (shares in certificated form will be void). Although the Law of Ukraine "On joint-stock companies" and does not contain direct norms under which questioned the ownership of securities in connection with the entry into force of this provision of law, but it creates serious problems for the treatment of shares and re-registration of property rights in the system registry . Interviews were conducted by us with the owners of small holdings of shares, bought them at the time of the privatization auctions, show that people just can not believe that the state forces them to take certain actions to protect their rights (to go into town, where the society to open securities account, etc.), because in the 90's all the action to obtain property rights for the shares were committed at the place of application for purchase of such shares, the most convenient for the shareholder, decided to buy shares of the company. As a result many small shareholders are almost ready to give up their rights to shares, which indicates that the Act was deliberately laid down the mechanism of artificial run-off from the register of small shareholders - ordinary citizens of Ukraine who have purchased at one time those shares for privatization of paper. Thus, big business, who actively participated in creating the current edition of the Law of Ukraine "On joint stock companies, decided to clean up the registers of shareholders and to rid themselves of the need to run society in the interests of a wide range of small investors. This essentially violates the principles of corporate democracy, and certainly have a negative impact on the investment image of Ukraine in the world.