Ukraine. Legal aspects of registration of changes related to place of seat of business entity in the Autonomous Republic of Crimea
Currently federal law of March 21, 2014 N 6-FKZ "On including Crimea to the Russian Federation and establishing of new subjects of the Republic of Crimea and city of federal meaning Sevastopil within the Russian Federation” (hereinafter – “Law”) stipulates transitional period within which to January 1, 2015 relations in peninsula shall be regulated according to legal acts of AR Crimea and city of Sevastopil unless proper legal acts of Russian Federation or “Republic of Crimea” are adopted previously.
Implementing of legal acts that contradict with Constitution of the Russian Federation is prohibited.
Herewith there are no reasons to state that Ukrainian legislation is not applicable within the territory of the peninsula, which, in particular, is conformed by political part of Association agreement regarding territorial integrity of Ukraine, signed between Ukraine and European Union.
It shall be noted that business entities that are willing to continue carrying out their business activities in the territory of Ukraine shall pay attention to effective legal acts which regulate order of amending of place of seat of legal entities and place of business activities of individuals-entrepreneurs taking into consideration annexation of the peninsula.
In particular, as for regulation of registration by the Ministry of Justice of Ukraine order of March 3, 2014 № 525/5 “On registration of place of seat of legal entities and place of residence of individuals- entrepreneurs” (hereinafter – “Order”) was published.
According to the order carrying out of registration activities regarding the amendments to place of seat of legal entities and place of residence of individuals-entrepreneurs, whose place of seat/residence is AR of Crimea and city of Sevastopil, is conducted by state registrator of local bodies of Ministry of Justice of Ukraine in regions and city of Kyiv. Access to the Unified register of legal entities and individuals-entrepreneurs in the territory of AR of Crimea has been closed by State entity “Informational and resource center”.
Carrying out of registration activities is conducted by the state registrators under documents, stipulated at the Law of Ukraine “On state registration of legal entities and individuals-entrepreneurs”.
Registration cases shall be transferred according to the new place of seat and place of residence under notifications by post, means of electronic communication and other means, sent by state registrators.
Such transfer may be also conducted by giving of registration case on request of the authorized persons of legal entities and individuals-entrepreneurs (hereinafter – “Representatives”) against signed receipt. Receipt, inter alia, contains obligations of Representatives related to further transfer of registration cases to a state registrator according to a new place of seat or place of residence.
Under results of carrying out of registration activities state registrators in regions and city of Kyiv shall issue new Record from the Unified register of legal entities and individuals-entrepreneurs, wherein new place of seat of legal entity or new place of business activities of individuals-entrepreneurs is stated.
In our opinion as for proper legal argumentation of such procedure certain amendments to the Law of Ukraine “On state registration of legal entities and individuals-entrepreneurs” shall be made. However, taking into consideration the critical situation in Crimea we believe that state registrators will act with understanding and shall carry out registration activities under procedure, defined at Order.
It shall be also taken into consideration that Order is not applicable for amendments to place of seat and place of residence within the territory of AR of Crimea and city of Sevastopil.
As a result, currently procedure of shifting of legal address of an entity and address of business activities of an individual-entrepreneur from territory of Crimea to the other regions of Ukraine has been stipulated by Legislator.
Abovementioned opportunity ensures solving of several problems related to sale-purchase of corporate rights of entities, payment of taxes and fees, conduct of contracts with counter parties etc. Nevertheless, problem regarding tangible assets of entities, which are located in the territory of Crimea, is still unsolved.
Provided that drafts of laws regarding occupied territories, which are negotiated in Verhovna Rada of Ukraine and according to which among other issues it is stated that any business activity (of commercial or nonprofit character), whereto state implements such means of regulation influence as licensing, patenting and quoting, issuance of permits, certification and standardization, investment, tax and other incentives, the provision of subsidies, compensation, innovation and targeted subsidies, is prohibited, it shall be claimed that whereas proper law is adopted, activities in the territory of Crimea that require, for instance, licensing, will be considered illegal according to the effective legislation of Ukraine.
Consequently, in our opinion, business men shall act urgently as for amend of place of seat of legal entities or place of business activities of individual-entrepreneur who are registered in Crimea and who are planning to continue carrying out their business under the legislation of Ukraine.
Arina Kostina, Paralegal with Legal Alliance Company
Konstantyn Boiko, Junior associate with Legal Alliance Company
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