Course work

The economic significance of the establishment of a joint stock company.

A joint stock company is no longer needed by the world. Let's take a brief look at the history of joint stock companies, which is important in the era of market economy in our modern world. There are records of joint-stock companies being formed in Europe as early as the 13th century. However, they appear to have multiplied beginning in the 16th century, when adventurous investors began speculating about opportunities to be found in the New World. European exploration of the Americas was largely financed by joint-stock companies. Governments were eager for new territory but were reluctant to take on the enormous costs and risks associated with these ventures.That led entrepreneurs to devise a business plan. They would sell shares in their ventures to many investors in order to raise money to fund voyages to the New World. The potential for resources to be exploited and trade to be developed was the attraction for many investors. Others wanted to literally stake a claim in the New World and establish new communities that would be free of religious persecution. In American history, the Virginia Company of London is one of the earliest and most famous joint-stock companies. In 1606, King James I signed a royal charter permitting the company exclusive rights to establish a colony in what is now Virginia. The Virginia Company's business plan was ambitious, ranging from exploiting the region's gold resources (there weren't any) to finding a navigable route to China (they didn't). After many hardships, the company successfully established the Jamestown colony in Virginia and began to grow and export tobacco. However, in 1624, an English court ordered the company to dissolve and converted Virginia into a royal colony. The investors in the Virginia Company never saw a profit.⁴

Organizational basis of joint-stock companies Joint-stock companies can be established through the establishment or reorganization of a legal entity (merger, division, separation, change). The establishment of a joint-stock company through its establishment is carried out by the decision of the founders (founder). The decision to establish a company is made by the founding meeting. If a company is founded by one founder, the decision to establish a company is made by that founder individually. The founders of the company enter into a memorandum of association on its establishment, which includes the procedure for their joint activities for the establishment of the company, the amount of the company's charter capital, the types of shares to be placed between the founders, the amount of the fee paid to them and the procedure for its payment, the rights and obligations of the founders to establish the company. The decision to establish a company must reflect the results of the founders' vote and the decisions taken by the founders on the establishment of the company, approval of its charter, the formation of the governing bodies of the company. On the establishment of the company, approval of its charter and approval of the monetary value of securities, other property rights or other rights with a monetary value, contributed by the founder to pay for the shares of the company decisions are made unanimously by the founders. The joint-stock company is formed with the participation of foreign investors, whose share in the charter capital must be at least 15%, except as provided by resolutions of the President of the Republic of Uzbekistan and the Cabinet of Ministers of the Republic of Uzbekistan. Joint-stock companies with a share of a foreign investor in the amount of 15% to 33% of the charter capital are provided with benefits on corporate income tax, property tax, single tax payment, contributions to the Republican Road Fund.⁵
Establishment of a company with foreign investors is carried out in accordance with the legislation of the Republic of Uzbekistan. When a state organization is transformed into a joint-stock company, the decision to establish a joint-stock company shall be made by the body authorized to dispose of state property. The number of founders and shareholders of a joint-stock company is not limited. It follows that a joint-stock company can be established by a single person. Subsequently, during the activities of the joint-stock company, the practice of selling part or all of the shares by one sole shareholder to other persons may be observed. Legal entities and individuals who have signed a memorandum of association on the establishment of a company are recognized as the founders (founders) of the company.Unless otherwise provided by law, the decision of the President of the Republic of Uzbekistan or the Cabinet of Ministers of the Republic of Uzbekistan, state bodies may not be the founders (shareholders) of the company. The founders of the company are jointly and severally liable for the obligations related to the establishment of the company until the state registration of the company. The company shall be liable for the obligations of the founders in relation to the organization of the company only if the actions of the founders are subsequently approved by the general meeting of shareholders. When a state organization is transformed into a joint-stock company, the founder of the company is the body authorized to manage the state property. The distribution of shares among the founders of the company is carried out in accordance with the constituent document. The founding meeting of the founders considers: - decides on the establishment of the company and approves its charter; - approves the agreements concluded by the founders during the establishment process; - determines the procedure for payment of shares by the founders; - determines the types and number of shares to be issued; - elects the company's supervisory board, audit commission (auditor); - forms (elects, appoints) the executive body of the company. Voting at the founding meeting is based on the contributions of the founders. Decisions of the Constituent Assembly shall be taken by a simple majority of votes, except in the case of a decision to amend the Memorandum of Association, which requires the consent of all the founders. The decisions of the founding meeting are formalized in a protocol signed by all the founders of the company. Transformation of a state organization into a joint-stock company shall be carried out without holding a constituent assembly on the basis of a decision made by the body authorized to dispose of state property.A founding meeting is not held in a one-member company. The charter is the constituent document of the joint-stock company, which must contain the following information: - full (if abbreviated) company name, location (postal address) and e-mail address of the company; - field of activity, main directions and goals; - amount of authorized capital; - number, par value, types (ordinary, preferred) of the company's shares; - The structure of the company's management, the number of members of the company's supervisory board, audit committee and executive body, the order of formation of these bodies, their powers. The charter of a joint-stock company may set limits on the maximum share of one shareholder in the charter capital of the company. The charter of a company, where the state has a special right to participate in the management of the company ("golden share"), should specify the rules for the use of this special right by the state. The company's charter may contain other provisions in accordance with the law. Model form of the charter of joint-stock companies Order of the Minister of Justice of the Republic of Uzbekistan dated December 20, 2016 No 294-mh "On approval of standard forms of constituent documents of commercial organizations" (registration number 2848, 20.12.2016 given in y.).⁶
At the request of a shareholder or any interested person, the company must, within three working days, give them the opportunity to review the company's charter, including changes and additions to the charter. At the request of the shareholder, the company must provide him with a copy of the company's charter. The company must be registered as a legal entity. The company submits the company's charter and other documents required by law to the registration authority for state registration. A society formed by a change in the organization of the state, as well as by a single founder, presents the charter of the society. The Ministry of Justice is the state body that registers joint stock companies. Violation of the statutory procedure for the formation of a company or its inconsistency with the charter shall entail the refusal of state registration. Refusal to register a society on the grounds that it is not expedient to establish it is not allowed. Denial of state registration, as well as violation of the terms of registration can be appealed in court. The company must prepare the following documents and approve them at the general meeting of shareholders within three months from the date of state registration:
- Regulations on the general meeting of shareholders;
- Regulations on the Supervisory Board;
- regulations on the executive body (director, management, trustee, respectively);
- Regulations on the audit commission (auditor).
Amendments and additions to the charter of a joint-stock company, including the new edition of the charter of the company, must be registered by the state in the manner prescribed for the registration of the company. Amendments and additions to the charter or the new version of the charter of the company shall come into force for third parties from the moment of its state registration. The charter capital of a joint-stock company consists of the nominal value of the company's shares received by shareholders and is expressed in the national currency of the Republic of Uzbekistan. All shares issued by the company must have the same par value. The charter capital of a company determines the minimum amount of the company's property that guarantees the interests of the company's creditors. When a company is established on the basis of state property, the market value of the organization (property) determined in accordance with the procedure established by the Cabinet of Ministers of the Republic of Uzbekistan shall be the sum of the company's charter capital. The company is obliged to place ordinary shares, as well as the right to place preferred shares. The nominal value of placed preferred shares should not exceed 20% of the company's charter capital. When a joint stock company is established, all its shares are placed among the company's founders.
More information about a joint stock company can be divided into 2 types.
An open joint stock company is an open joint stock company in which the shareholders can freely dispose of their shares without the consent of other shareholders. The minimum number of members of an open joint stock company is not limited. An open company has the right to openly subscribe to its shares and sell them freely, subject to the requirements of the law. The purpose of an open subscription is to increase the authorized capital and expand financial opportunities. Research shows that frequent subscriptions in limited quantities have the greatest benefits: a large subscription does not guarantee its success, it costs a lot of money for an advertising campaign, and it reduces the level of dividends.
Open society:
- annual report of the company, balance sheet, profit and loss account;
• certificate of issue of the company's shares;
• notice of the general meeting of shareholders in the manner prescribed by this law;
• lists of persons guaranteed by the company, indicating the number and types of shares owned by them;
• publish in the media annually other information determined by the competent state body.
A company whose shares are distributed only among its founders or other predetermined persons is considered a closed joint-stock company. The founders of a closed company shall be at least three persons. A closed company shall not have the right to openly subscribe to its shares or otherwise offer them to an unlimited number of persons for purchase. The number of shareholders of a closed company should be up to 50. In case of exceeding the established limit for closed joint-stock companies, persons whose amount exceeds the limit set by the shareholders must be transformed into an open joint-stock company within six months from the date of registration in the register of shareholders.
Shareholders of a closed company have a preemptive right to purchase shares sold by other shareholders of the company at a price offered to another person. If the shareholders do not exercise their preemptive right to purchase the shares, the company's charter may provide that the company has a preemptive right to purchase the shares sold by the shareholders.
The procedure for exercising the preemptive right to purchase shares sold by shareholders shall be determined by the company's charter. The term of the preferential right may not be less than 30 days and not more than 60 days from the date of the sale of shares.
Generally, closed joint stock companies are exempted from publishing annual reports, but more often they publish annual reports on their own initiative. These announcements are published to introduce a wide range of legal entities and individuals to the activities of the society and to attract new partners.
The company may establish its own branches and representative offices. They are provided with property by the society they form and operate in accordance with the rules approved by the society.
The head of the branch or representative office is appointed by the company and acts on the basis of a power of attorney issued by the company. Responsibility for the activities of the branch and representative office rests with the company that established them.
The charter of the company should contain information about its branches and representative offices. Information on changes in the charter of the company in connection with changes in information on branches and representative offices shall be submitted to the state registration body of legal entities in the form of information. The Company shall establish branches and representative offices outside the Republic of Uzbekistan in accordance with the legislation of the country where the branches and representative offices are located, unless otherwise provided by an international agreement of the Republic of Uzbekistan.In addition, a joint stock company may have subsidiaries and affiliates that have the status of legal entities. A subsidiary is not liable for the debts of its parent company. The legal entity shall be jointly and severally liable with the subsidiary for the performance of such instructions by the subsidiary in accordance with the agreements entered into by the subsidiary. The parent company has the right to issue binding instructions to the subsidiary only if it is set out in a contract with the subsidiary or is provided for in the subsidiary's charter. In the event that a subsidiary becomes insolvent through the fault of the parent company, the parent company becomes subsidiary liable for the debts of the subsidiary. Insolvency of a subsidiary company is possible only if the parent company knows in advance that it will become insolvent as a result of certain actions of the subsidiary and uses its above-mentioned rights and opportunities to carry out such actions of the subsidiary. is considered to have occurred through no fault of his own.
The shareholders of a subsidiary have the right to demand from the parent company compensation for damages caused to the subsidiary through its fault. Damage is considered to be the fault of the parent company only if the parent company knew in advance that the subsidiary company would be harmed as a result of certain actions and used its rights and opportunities to enable the subsidiary company to carry out such actions.
A company is considered a subsidiary if more than 20% of the company's voting shares are owned by another member company. The relationship between participating and subordinate societies is governed by law. Today, the necessary measures are being taken in our country to develop the activities of joint-stock companies and strengthen their role in the liberalization of the economy. In particular, the Decree of the President of the Republic of Uzbekistan dated July 20, 2007 "On additional measures to deepen the process of privatization of enterprises in strategic sectors of the economy" allowed to further accelerate reforms in this area.⁷
In accordance with the decree, in order to expand the list of enterprises and facilities sold as private property in public auctions, in order to comply with internationally accepted norms, the state share in the charter capital of strategic sectors of priority priority for the economy since August 1, 2007 The principle of a special limited right of state participation in the management of joint-stock companies, which does not exist or whose share does not exceed twenty-five percent, was introduced - the principle of "golden share".
In addition, the Regulation on the procedure for exercising the special right of the state to participate in the management of joint stock companies ("golden share"), developed on the basis of this Decree and approved by the Cabinet of Ministers of the Republic of Uzbekistan on July 24, 2007 the procedure for appointing a state representative legally strengthened his powers and obligations.
Article 24 of the Law of the Republic of Uzbekistan "On amendments and additions to the Law of the Republic of Uzbekistan" On joint-stock companies and protection of shareholders' rights "by the Legislative Chamber of the OliyMajlis of the Republic of Uzbekistan According to the new additions and changes, Article 241 provides for the privatization of "golden shares", ie the privatization of strategic sectors that are a priority for the country's economy. a special limited right of state participation in the management of some joint-stock companies was introduced. "Golden share" is a special right of state participation in the management of individual joint-stock companies, which is introduced by the decision of the Government of the Republic of Uzbekistan in the privatization of state-owned enterprises of strategic importance or the sale of state-owned shares of joint-stock companies. interests are protected.
The "golden share" has no value, is not transferred or pledged, is not taken into account in determining the amount of the authorized capital and the calculation of dividends. Gold shares can be introduced in joint-stock companies that do not have a state share in the charter capital or this share does not exceed twenty-five percent. The Cabinet of Ministers of the Republic of Uzbekistan shall determine the procedure for the use of the state's "golden share".
In addition, the "golden share" is realized through the appointment of a state representative to the Supervisory Board of the joint-stock company. The State Representative shall participate in the general meeting of shareholders and the meetings of the Supervisory Board on a mandatory basis with the right of veto on issues provided by law. The veto shall be in writing on the day these decisions are made.
Also, on the basis of these additions and changes, the first part of Article 47 of the current Law states that This is a list of shareholders, which allows to determine the accuracy of the number and category of securities owned by them, to which it is necessary to introduce a "golden share". It was stipulated that a state representative should be included in the register of shareholders of the company.⁸
In turn, issuers must maintain a register of shareholders in the form prescribed by the state authority for regulation and coordination of the securities market, the company that placed the shares or a specialized registrar may be the custodian of the register of shareholders and, most importantly, ordinary (ordinary) ) The law stipulates that a company with five hundred or more shareholders who is a shareholder must transfer the maintenance of the register and storage to a specialized registrar on a contractual basis. Another innovation in the law on joint-stock companies and the protection of shareholders' rights is that the issuance of an extract from the register of shareholders to a representative of the state is carried out in the manner prescribed by law.⁹
The law also stipulates that "the entry of a state representative in the register of shareholders shall be made by the State Committee for State Property Management of the Republic of Uzbekistan on the basis of notification of the register holder with the relevant decision on the appointment of a state representative". The right to participate in the general meeting shall be exercised by him personally.
In conclusion, the introduction of a special right of state participation in the development and management of joint-stock companies in the context of economic liberalization, firstly, guarantees the full protection of economic interests of the country, secondly, the rights of each shareholder in the management of joint stock companies. serves to protect the interests protected by. Joint-stock companies in Uzbekistan emerged during the process of market reforms in the process of denationalization and privatization of property, and the transformation of state-owned enterprises into joint-stock companies will become one of the directions of property change. In the first stage of the reforms, a closed joint-stock company was established. In its second stage, an open joint-stock company began to take shape. In Uzbekistan, the company is part of the non-governmental sector.

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