BarentsNews.com

Starting from 28 June 2003 the new Federal Law No.73-FZ of 11 June 2003 “On making changes and amendments to the Federal Law “On Agricultural Co-operative Organizations” came into force (the “Law No.73-FZ”).

The new Law governs activity of fishing collective farms (kolhoz) as well as other types of agricultural co-operative organizations. The Law No.73-FZ provides detailed regulation of distribution of powers between different corporate bodies and regulates activities of the executive bodies of fishing collective farms as well as procedure for arranging general meetings of fishing farm participants.

It should be stressed that according to the Law No.73-FZ a Chairman of Fishing Collective Farm is not allowed to enter into any Contract without corporate decision. The authority of corporate body to make decision for entering into particular contract will depend from the amount of transaction. If amount of transaction is less than 10 per cent of joint assets of the fishing collective farm, not taking into account the value of its land plots and main assets (e.g. vessel), than it is necessary to obtain Decision of the Management Board for making transaction. If amount of transaction is between 10 and 15 per cent, than Decision of the Supervisory Board should be made. Transaction with the amount ranging between 15 and 20 per cent requires Joint Decision of Management Board and Supervisory Board.

Any transaction being more than 20 per cent of assets or connected with the sale-purchase of land plots or main assets shall be entered on the basis of the Decision of the General Meeting of Fishing Collective Farm Participants.

Sergei Mashkarenko.
Lawyer
Tel/Fax: +7812-174-59-50