A closed joint-stock company (CJSC) is a private entity. Its authorized capital is divided into shares of stock. A significant difference between a CJSC and other types of companies is that the circulation of securities in a CJSC is reduced.
Compiling an agreement on company incorporation
A memorandum of the founders’ meeting in case of a CJSC is similar to memorandums of other types of companies. The document is a civil law agreement and must be issued in writing. An incorporation deed must contain certain information about the closed joint-stock company. It shall indicate its founders, their number, the value of securities, whether they are classified as ordinary or preferential, how they are divided among the CJSC participants, etc. Please note that the Belarusian legislation prescribes the minimum size of the CJSC’s authorized capital – at least 100 basic units.
Approving the name
The procedure for naming a closed joint-stock company is the same as for other private enterprises. The main requirement is not to use already existing or documented names of other legal entities, as well as those confusingly similar to them.
Convening a founders’ meeting
At the meeting of the founders of a closed joint-stock company, its charter, basic principles of corporate management and the format of circulation of its securities shall be agreed upon. Where the number of shareholders exceeds fifty, it will be necessary to organize a supervisory board. A significant difference between a CJSC and an LLC is that in a closed company, shareholders are not equal in rights, and decisions will not be made upon consent of absolute majority. A degree of a shareholder’s influence on the firm depends on the block of shares he owns. Decisions will be rendered only after at least 75% of the participants of the meeting have come to a consensus.
Submitting papers for CJSC registration
The list of documents that must be submitted to a state registrar in case of a CJSC is the same as in case of other private companies.
Obtaining documents confirming CJSC registration
After receiving the document suite, the state registrar will examine them. The registrar will affix an official seal to the company charter. At this moment, the joint-stock company is deemed to be active. The tax authorities will also be informed about its existence. The certificate confirming state registration of the CJSC is normally issued together with the charter. A notification of company registration is normally received at least five days after the completion of the procedure.
Opening a bank account
An account must be opened in a Belarusian bank. This can be done immediately after receiving the certificate of CJSC registration. You shouldn’t delay opening an account, otherwise your CJSC will not be able to carry out its activities. However, the applicable regulations do not prescribe a time limit for opening an account for a closed joint-stock company. The account must be in Belarusian rubles or, as necessary — in a foreign currency. Registration of a bank account falls within the competence of CJSC director or his authorized representative.
The securities authority will formally register the CJSC’s shares within two months after receiving the certificate of CJSC registration. The procedure will be started after CJSC head or his authorized representative has applied to the securities authority. Also, the company must find a specialist who will conduct securities affairs. To that effect, the company can conclude an outsourcing agreement with a bank.