ARMENIA Law and Practice Contributed by: Hayk Hovhannisyan and Suren Sloyan, HAP
The Law on Limited Liability Companies (LLLC) The LLLC governs the operations of LLCs. It focuses on shareholder rights, management structures and decision-making processes. It provides a framework for the internal govern - ance of LLCs, ensuring clarity in the roles and responsibilities of owners and managers. The Law on Bankruptcy The Law on Bankruptcy governs insolvency pro - ceedings and the restructuring of companies. It establishes the rights and obligations of credi - tors as well as the roles of corporate manage - ment during insolvency, ensuring a structured process for debt resolution and corporate recov - ery. The Law on State Registration of Legal Entities The Law on State Registration of Legal Entities establishes requirements for the registration of companies and their ongoing obligations under Armenian law, including compliance with gov - ernance standards. Armenian Securities Market Legislation Armenian securities market legislation includes regulations on public companies and the gov - ernance of stock exchanges, market participants and the protection of shareholders in publicly traded companies. These legislative sources together shape the corporate governance framework in Armenia, ensuring that companies operate transparently, remain accountable to stakeholders and comply with domestic and international legal standards.
Participants may contribute professional exper - tise, skills, business reputation and connections as well as capital. During joint activities, each participant may act on behalf of all, unless otherwise specified in the contract, which may require joint action by all parties. This form of organisation is particularly effec - tive when an individual has skills or expertise but lacks financial assets. Each of these business forms should be care - fully evaluated to determine the most appropri - ate legal entity for establishment based on the specific needs and goals of the business. 1.2 Sources of Corporate Governance Requirements The primary legislative sources of corporate gov - ernance requirements for companies in Armenia are as follows. The Civil Code of Armenia (CC) The CC defines the concept of a legal entity, its types, legal capacity, liability, redomiciling pro - cedure, reorganisation procedure, liquidation procedure and other general principles. The Law on Joint Stock Companies (LJSC) The LJSC regulates the structure, governance and operational processes of JSCs. It outlines the rights of shareholders, the duties of the board of directors (BoD) and the requirements for financial transparency and disclosure. It also sets out provisions for annual meetings, dividend distribution and financial reporting obligations.
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