Month: September 2019

Amendments to The Commercial Register Act

At the end of the previous and the beginning of the present year some amendments were made to the Commercial Register Act to optimize the register procedure.

The principle position of the procedure pursuant the Commercial Register Act is the encouragement of the use of electronic documents and the electronic signature. In this connection it is stipulated that the application for the registration and that for the deletion of the circumstances and the application for the publication of the acts as well are submitted by the joint-stock companies and the limited partnerships with shares only in electronic form. Thus is achieved also harmonization of the norms of the community law in this sphere.

Another amendment concerns the circle of the applicant. Now the procurator is included in the category. They are natural persons, assigned and authorized by the merchant to manage their company for remuneration and have the right to undertake any actions and conclude any deals related to the exercising of the trade occupation. The practice of the registration officials was to refuse to recognise the procurator’s capacity as an applicant often without any justification.

Of greatest significance is the amendment concerning the obligations of the official when processing the received application. In general, the procedure for the registration, publication or the deletion of the acts at the Commercial Register can be summarized the following way: for each action sought, an application according to a sample is issued which must be accompanied by a document for a paid state tax and other documents if required by law. After receipt of the application, the registration official revises it and if it is duly filled out and accompanied by all required appendices – the demanded action is performed. In case the application is invalid for any reason, a justified refusal is issued. This refusal can be appealed before the District Court competent for the seat of the merchant or the branch office of the foreign merchant in a 7-day term from its receipt. Such was the practice before the last amendments. In most cases for committed errors or the incomplete content, the applicant loses the deposited fee or goes through court actions, even with a positive resolution, results in waste of time – a factor of huge importance for the dynamic trade relations. What is changing in this respect with the last amendments? The new regulation provides forthe official to instruct the applicant to remedy the irregularities when the latter has not enclosed all documents required by law or if the due state fee is not paid. These instructions must be published via the trader’s electronic account and when an application for the registration of the merchant is submitted – to be published in the web-site of the agency. This must happen not later than the next work day from the receipt of the application at the Commercial Register. The applicant can fulfill the given instructions by submitting a new application. If this does not happen within 3 days, the official can issue a justified refusal. With this amendment, without hampering one of the principles of the commercial registration – namely, the speedy and thrifty procedure, the latter adapts to the needs of the trade turnover.