Main provisions of typical shareholders' agreements

Since 2009 Russian law has contained express provisions on shareholders' agreements. Further provisions of the Civil Code came into effect on 1 September 2014.

By law, shareholders' agreements can require shareholders to:

  • exercise their rights (in particular, their voting rights) in a certain way or abstain from exercising such rights;
  • acquire or alienate their shares at a certain price or on the occurrence of certain circumstances, or abstain from alienating shares until certain circumstances occur; and
  • take other agreed actions regarding the company's management.

However, a shareholders' agreement cannot require shareholders to:

  • vote in accordance with the instructions of a corporate body of the company; or
  • determine the structure or the competence of the corporate bodies of the company other than by amending the company's bylaws in accordance with the relevant laws.

To secure the performance of their rights, creditors of the company and any other third parties can enter into agreements with shareholders under which the shareholders take, or refrain from taking, certain corporate actions.

Can shareholders' agreements be enforceable against third parties?

Under Russian law, shareholders' agreements are obligatory only for the parties to the agreement. Therefore, they are not enforceable against third parties.

The breach of a shareholders' agreement can serve as a basis for a court recognising a resolution of the company's management body as invalid if all shareholders were parties to the shareholders' agreement. However, the resolution's invalidity is not a reason for the invalidity of a transaction with a third party which was entered into on the basis of the resolution.

If a transaction entered into by a party to a shareholders' agreement is in breach of that shareholders' agreement, it can be declared invalid by a court only if the other party to the transaction knew, or should have known, of the breach.

Do shareholders' agreements have to be publicly disclosed or registered?

There are no registration requirements. Further, there is no public disclosure requirement for non-public joint stock companies. As regards public joint stock companies, the Civil Code states that information on shareholders' agreements must be disclosed to the extent provided in the Law on Joint Stock Companies. However, the law contains no public disclosure requirements.

The parties to a shareholders' agreement must inform the relevant company that they have entered into a shareholders' agreement. However, they do not have to disclose its contents.

A shareholder in a public joint stock company must notify the joint stock company of certain details of the shareholders' agreement (eg, its date of signing and effect, its validity term and the number of shares of the respective shareholder) if:

  • in accordance with the shareholders' agreement, it acquires the right to determine the order of voting of shares of the company; or
  • as a result of such acquisition, the shareholder and its affiliated persons directly or indirectly hold more than 10%, 15%, 20%, 25%, 30%, 50% or 75% of the respective company's common shares.

If competitor shareholders on the Russian market who do not belong to the same group of persons enter into a shareholders' agreement regarding their joint activity in the Russian market, the agreement may require the prior approval of, or notification to, the Russian antitrust authority. This depends on the scale of business of the acquirer and the target and their position on the Russian market.

For further information on this topic please contact Thomas Mundry at Noerr LLP by telephone (+7 495 799 56 96) or email ([email protected]). The Noerr LLP website can be accessed at

An earlier version of this article was first published by Thomson Reuters.

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