The concept of a major transaction is enshrined in Art. 46 Federal Law No. 14. According to the norm, it recognizes transactions connected with each other, within the framework of which acquisition, alienation or the possibility of an economic entity to make an indirect or direct reimbursable transfer of property, the price of which is equal to or exceeds 25% of the value of property belonging to the company, is assumed. The cost is determined by the information specified in the financial statements for the billing period preceding the date of the decision on approval, unless another size of a major transaction is fixed in the charter.
Exceptions
Under article 46, contracts are not considered large transactions:
- Committed in the ordinary course of business of a subject.
- The conclusion of which is mandatory for the LLC in accordance with the provisions of federal law and other regulatory acts and the calculations of which are carried out at prices established by the government, or tariffs determined by a body authorized by the government.
According to the Law "On Limited Liability Companies", the value of disposable material assets is determined according to accounting data, and the price of acquired property is determined in accordance with the amount of the offer.
Matching
At a general meeting, members of the company decide to approve a major transaction. It indicates the entities acting as parties, beneficiaries in the contract, subject, price and other material conditions. This requirement, however, may not be met if:
- the transaction must be completed at auction;
- beneficiaries and parties cannot be determined by the time the transaction is agreed.
If a board of directors (supervisory board) is formed in the structure of a business company, the decision to approve major transactions related to the alienation, acquisition or the possibility of direct or indirect transfer of property, the price of which is 25-50% of the value of tangible property owned by LLC, may be assigned to its competence. The corresponding instruction should be contained in the charter of the company.
According to the law, a major transaction concluded in violation of the terms of the agreement may be invalidated in court. The statement of claim may be submitted by the company itself or its participant. In the case of a pass, the term for appeal to the court cannot be restored.
Court refusals
The court has the right to refuse to satisfy the claim for invalidating the transaction concluded with violations of the provisions of the law, in the presence of any of the following circumstances:
It is not proven that when a major transaction was made, the company or the party that went to court incurred or may incur losses or other adverse consequences.
The voice of the subject who submitted the application for recognition of the invalidity of the transaction, the decision on the approval of which is adopted at the general meeting, could not affect the voting results, despite the fact that he participated in it.
By the time of the proceedings, materials were submitted confirming the subsequent approval of the transaction in the manner prescribed by the law "On Limited Liability Companies".
When considering the case, it was proved that the other party to the transaction did not know and should not have known that at its conclusion the requirements of Art. 46.
Nuances
The charter of an economic entity may stipulate that the adoption of a decision on consent to major transactions is optional. In this case, one nuance should be taken into account.
If a major transaction is at the same time an agreement in which there is an interest, the procedure for its approval is established in accordance with the provisions of Article 45 of the Federal Law No. 14. An exception is provided for cases when all participants of the economic entity have such an interest. In this situation, the approval of a major transaction is carried out according to the rules of Art. 46.
Special conditions
The provisions of Art. 46 on the rules for the approval of major transactions are not applicable:
- To relations arising in connection with the transfer of rights to the property complex in the framework of the reorganization, including the conclusion of agreements on accession and merger.
- Business entities, which consist of one member, simultaneously being the sole executive body.
- The relations that arise during the transition to the LLC share (its part) in the authorized capital, in cases enshrined in Federal Law No. 14.
Special requirements for large transactions for legal entities are enshrined in laws:
- About non-profit organizations.
- LTD.
- AO.
- Unitary enterprises.
- Bankruptcy.
- Autonomous institutions.
Delineation of concepts
In practice, difficulties often arise in differentiating large transactions and related-party contracts. In simple terms, the first include agreements related to the acquisition, alienation, pledging, use, etc. tangible assets, the value of which is a significant part of the assets of the enterprise.
Under general rules, interested party transactions are recognized as contracts, the parties to which on the one hand are persons who have a certain influence on the activities of a business company. These include, in particular, related entities, having rights to shares (stocks), implementing management functions, etc.
Specific criteria for delimiting major transactions and agreements of interest are enshrined in the law on the relevant business company. Such agreements are not drawn up by the approval of the general director, but by decision or by prior agreement of a collegial or other authorized management body. In this regard, for the registration of transactions or the rights of legal entities, depending on the value of the property and the price of the contract itself, additional documents may be required.
Terms of conclusion of contracts for various legal forms
As mentioned above, for each type of business company there are special rules for processing large transactions. For example, budgetary institutions must first obtain the consent of the body that implements the functions of the founder. The corresponding requirement is enshrined in Art. 9.2 of the Federal Law "On Non-Profit Organizations" (paragraph 13).
Autonomous institutions make major transactions by prior coordination with the Supervisory Board. This requirement is established in the first parts of articles 15 and 17 of the Federal Law No. 174.
What is a major deal for a municipal or state-owned enterprise? It recognizes an agreement related to the alienation, acquisition or possibility of indirect / direct sale of property worth more than 10% of the authorized capital or exceeding the minimum wage by more than 50 times.
Consequences of invalidity
Upon satisfaction of the claim on the non-compliance of the transaction with the requirements of the law, no obligations and rights provided for by its conditions do not occur. The consequences of the invalidity of the contract apply .
As an exception, the court may terminate the agreement not from the date of its execution (as provided for by civil law), but for the future period - from the date of the relevant decision. This provision applies only to disputed transactions, if it follows from their essence that they can be terminated only for the coming time. It is mainly about ongoing agreements. Termination of their validity from the date of conclusion is either impossible or inexpedient.
Bilateral Restitution
It is another important consequence of the invalidity of the transaction (including large). Upon termination of the contract, its participants return to the legal status that existed before its conclusion. This means that each party returns to the other everything that was received under the terms of an invalid transaction.
Bilateral restitution applies if participants have fully or partially complied with the provisions of the contract. If someone does not have the opportunity to return what he received in kind, he is obliged to reimburse the value of the property with money, unless the law provides for other consequences.
Controversial situations
It is worth saying that the rules on bilateral restitution are not implemented in practice in all cases. For example, a party to a transaction cannot return goods that have been resold to a third party. Compensation in such situations often does not make sense, since the purchaser has already paid for the thing, and a repeated transfer of funds to the seller will be considered unjust enrichment.
The Constitutional Court on such situations explained that when invalidating transactions whose conditions are fully or partially fulfilled, one should proceed from an equal amount of obligations. That is why often in controversial situations, the rules on bilateral restitution cannot be implemented in practice.
Features of judicial practice
According to paragraph 2 of Article 46 of the Federal Law No. 14, when concluding a major transaction, the price of property alienated by the company is determined according to accounting data. As follows from the clarifications of YOU, the courts, determining the category of legal relations, must compare the price of the subject of the contract with the book value of the assets of the enterprise. She, in turn, is installed according to the latest reporting. In this case, the amount of debts (obligations) is not deducted from the value of assets. In the quality of the accounting period, in accordance with the Federal Law No. 129, is the year (calendar).
If the company does not have a balance sheet, the burden of proof of the absence of signs of a major transaction rests with the business entity. If the persons involved in the case have objections to the accuracy of the information provided by the enterprise, the value of the property may be determined in the framework of the accounting expertise. This procedure is appointed by the court, as a result of which a corresponding determination is made.
Big deal for LLC: how to calculate the percentage?
Consider the following example. Suppose a transaction is made in respect of an immovable property. Its cost is 45 million p. The cost of the property complex of the enterprise is 5 million rubles. 1% of this amount is 50 thousand rubles. Now we find the transaction value: 45 million / 50 thousand = 900%.
The calculation can be made in another way. You should divide the value of the object by the price of the property, and then multiply by 100:
45 million / 5 million × 100 = 900%.
Interested party transactions
For a better understanding of the differences between contracts that a business company may conclude, another category of agreements should be considered. This is also important because relatively recently, amendments were made to the Federal Law "On LLC".
Of the criteria by which an interested-party transaction is determined, affiliation was excluded. Together, the term “controlling person” was introduced into the law. This innovation significantly narrowed the list of subjects that can be recognized as interested.
The concept of "affiliation" seems to be broader than "control." In the first case, influence is supposed, in the second - the ability to determine decisions related to transactions.
The controlling persons may be members of the collegial management body, board of directors, the sole executive body, as well as a person authorized to give binding instructions.
Features of legislative changes
The concept of “controlling person” introduced in the Federal Law No. 14 is disclosed in the regulatory act in the same way as it is done in the law “On the Securities Market”. In this case, rulemakers took the path of formalizing the criteria and did not consider supervision as a basis for accountability. Some experts believe that this can lead to various problems in practice.
It should be noted that since 2017, the Russian Federation, region or municipality has not been considered controlling entities.
Grounds for recognition
Interested party transactions include contracts concluded by entities, the list of which is established in the norms, by their close relatives (children, spouses, brothers / sisters, including half-parents, parents, adopted children, adoptive parents), participating in other legal relations. These persons may act as beneficiaries, intermediaries, representatives. To recognize the contract as an interested party transaction, entities must fill positions in the organization’s management bodies.
Specificity of property valuation
The procedure for determining the value of values has been changed since January 2017. Currently, the rules for valuing property do not depend on the number of participants in the transaction. The key criterion for determining prices is the publicity or non-publicity of a business company.
In the latter case, the value of the values in respect of which a transaction is concluded for the joint-stock company is established by a majority of votes at a meeting of the board of directors. Here it should be said about the essential requirement enshrined in law. The subjects voting at the meeting should not have an interest in concluding a transaction.
If we talk about public enterprises, then the conditions provided for in paragraph 3 of Article 83 of the Federal Law No. 208 are added to the above requirement.
Approval Procedure
Transaction approval rules for non-public and public companies are different. The board of directors can approve the deal. In this case, a meeting is organized at which the minutes are kept. The board of directors can also agree.
In any case, however, persons participating in the transaction are excluded from discussion. Their votes are not taken into account. Exceptions are provided in paragraph 4.1 of Art. 83 Federal Law No. 208.
For LLC established similar rules. As in the case of large transactions, the authority to coordinate agreements with interest can be transferred to the board of directors. The charter of the company should fix the corresponding provision. In this case, some exceptions established by law should be taken into account. In particular, the general approval rules do not apply to transactions whose value exceeds 10% of the book value of the company's assets for the last settlement period.
As a rule, the decision to approve the agreement is made by the majority of non-interested members of the board of directors. However, the law may provide for the need to obtain a larger number of votes to agree on a transaction.