Legal Protection of Shareholders’ Rights Under Sanctions Regimes

Introduction. International economic sanctions are an important factor that inevitably affects the formation and development of internal and external corporate processes.

Methodology and materials. The main purpose of this article is to formulate practical recommendations for the protection of corporate shareholders’ rights in the current sanctions landscape, as well as to analyze existing protection mechanisms and adapt them to new legal and political realities. To achieve this purpose, the author used both philosophical and general scientific methods of cognition, as well as methods specific to legal science. The main theoretical basis of the research was the works of domestic and foreign scientists in the field of international private and public law, as well as researchers of corporate law and sanctions compliance.

The results of the study and their discussion. The author reveals the concept of corporate relations and offers his typology of subjects of corporate relations, taking into account modern corporate ownership and control structures in Russian corporations. Modern sanctions realities have forcibly expanded the range of subjects of corporate relations, actually including former majority shareholders who retained the mechanisms of influence on the company and/or have mechanisms for its return (for example, in the form of an option agreement). At the same time, modern sanctions affect important rights of the company’s shareholders, such as the right to receive dividends, to participate in and vote at general meetings, as well as to engage in business activities in general.

Conclusions. The very fact of influencing the company and exercising any form of control over it indicates that the person is a subject of managerial, corporate relations. The whole set of legal mechanisms for minimizing sanctions risks and their consequences for shareholders and participants of companies can be divided into corporate methods (for example, changing the ownership structure of the company) and contractual (such as an option agreement and a corporate agreement). The author provides recommendations on the most effective use of such methods in corporate and contractual practice through the disclosure of key provisions of corporate and option agreements. At the same time, it is important to understand that none of the methods described in the article is a guarantee of the complete exclusion of sanctions risks for shareholders and the protection/restoration of corporate rights in full.

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