Entry of a new member into the limited liability company

Following the provisions of the Companies Act, a third party can become a new member of a limited liability company based on the transfer of shares by registered members of the limited liability company, as well as based on the accession of a new member with a simultaneous increase in the share capital.

Transfer of shares

The basic rule is that the transfer of shares is free unless otherwise determined by the Companies Act or the Articles of Association.

The Companies Act establishes the following restrictions on the transfer of shares:

  1. pre-emptive right
  2. share transfers with the consent of the company
  3. company’s right to designate the share purchaser and
  4. the obligation to buy shares.

The articles of association of a limited liability company may provide for other types of restrictions on the transfer of shares.

Continue reading Entry of a new member into the limited liability company

Company’s own shares – acquisition and disposal

According to Companies Act (“Off. Herald of RS”, Nos. 36/2011, 99/2011, 83/2014 – other law, 5/2015, 44/2018, 95/2018, 91/2019 and 109/2021 – further: Companies Act) concept of shares is negatively determined, i.e. by the provisions of the Article 150 of the Companies Act shall be prescribed that a company’s shares are not securities and that a company’s shares may not be acquired, nor may they be disposed by forwarding a public offer in terms of the law regulating the capital market.

According to provisions of the Article 157 paragraph 1 of the Companies Act, a share or part of a share a company acquires from its member is considered to be own share of the company in terms of the Companies Act.

A limited liability company cannot acquire own share at its establishment but subsequently from its member due to certain legal situations, which are a specific exception type.

The company can achieve own shares exclusively based on the decision of the company’s assembly, and the founding act cannot transfer the decision on the acquisition of own share to the competence of another body of the company (the director or the supervisory board in the bicameral management system). Continue reading Company’s own shares – acquisition and disposal

Directors of limited liability companies, according to the Companies Act

According to the provisions of Article 218 of the Companies Act (“Official Gazette of RS”, no. 36/2011, 99/2011, 83/2014 – other laws, 5/2015, 44/2018, 95/2018, 91/2019 and 109/2021), the legal representatives of the limited liability company are the directors, and there is no possibility that the provisions of Article 218 of the Companies Act (“Official Gazette of RS”, no. 36/2011, 99/2011, 83/2014 – dr. law, 5/2015, 44/2018, 95/2018, 91/2019 and 109/2021) to be derogated or amended.

Companies Act (“Official Gazette of RS”, no. 36/2011, 99/2011, 83/2014 – other laws, 5/2015, 44/2018, 95/2018, 91/2019 and 109/2021) regulates many issues related to directors of a limited liability company such as the number of directors, appointment, representation, management, responsibility, reporting, remuneration, dismissal, resignation, etc.

Number of Directors

A limited liability company (further: company) may have one or more directors who are legal representatives of the company and are registered in the register of business entities per the registration act. Continue reading Directors of limited liability companies, according to the Companies Act