Publication date: 22.05.2024
The Commercial Cassation Court Published a Review of Practice on Protecting the Rights of Participants in Legal Entities
The Commercial Cassation Court of the Supreme Court has published a review of practice on protecting the right of a participant (shareholder, member) to obtain information about the activities of a legal entity and the right to request an audit of the company's financial statements. The review compiles legal positions of the CCC of the SC formed between 2018 and 2023.
Protecting the Right of Participants to Obtain Information
The right of a participant (shareholder, member) in a legal entity to obtain information about the activities of the entity is a crucial aspect of corporate governance and ensuring transparency in the company's activities. The review emphasizes that participants have the right to be informed about the company's financial status, operational activities, and strategic plans. This right includes access to documents, reports, and other important data.
The method of protecting the rights of a participant to obtain information may include filing a lawsuit if the company's management refuses to provide information. Judicial practice shows that courts often side with participants, ensuring them access to necessary information.
Scope of Information that the Legal Entity Must Provide
A legal entity is obligated to provide participants with access to a significant amount of information. This includes financial reports, meeting minutes, development plans, and other documents that are important for understanding the company's activities. Such a scope of information promotes transparency and trust between participants and management.You may be interested in the following articles: Analysis, consultation, evaluation. legal analysis of the situation, lawyer's consultation, lawyer's consultation, analysis of documents, legal analysis of the situation, written consultation, verification of documents by a lawyer, lawyers' documents, lawyer's help online, lawyer online, legal opinion, legal opinion of a lawyer, lawyer online.
Disputes Regarding the Conduct of an Audit
The right of an LLC participant to request an audit of financial statements is another important mechanism for protecting their interests. Participants have the right to make such a request, and the company is obligated to ensure that the auditor can conduct the review. This includes providing access to necessary documents and cooperating with the auditing firm.
The company's duty to ensure the auditor can conduct the review is crucial for ensuring the objectivity and reliability of financial statements. Courts often side with participants in cases where the company refuses to conduct an audit or obstructs this process.
Conclusion
The review of practice by the Commercial Cassation Court highlights the importance of protecting the rights of participants in legal entities to obtain information and conduct audits. This promotes increased transparency and trust in the activities of companies and ensures effective corporate governance.
