Change of CEO or Manager in Company

Capital Law Consulting can provide you with all needed legal services of appointment, resignation or removal of Chief Executive Officer of Ukrainian company. We can offer you the highest quality and best result. With more than 12 years of practice in corporate and employment law we do provide the best solution in every case. We can offer you:

  • drawing up a manager dismissal procedure;
  • effectuation of resignation or removal of CEO;
  • legal advice on the risks of changing director;
  • imposing or removing restrictions on managerial rights.

Legal basis for appointment, resignation or removal of Directors

Chief executive officer (CEO) of Ukrainian company is the person that makes legal actions from the name of the company. Usually in Ukraine such body of the company is called Director. Under Ukrainian law, executive body of the company can be single (Director or Manager or administrator) or collegial (board of directors). This is to be determined by shareholders of the firm and shall be mentioned in the articles of association. So it is always decided during company formation in Ukraine process. Although if your Ukrainian business is running with single director, but you want to establish board of directors, it can be done by approving of a new statute of the company. So any way it is a shareholder of enterprise to decide the quantity of directors, their rights and obligations and decision making. Most of Ukrainian limited liability companies run with single director.

CEO of Ukrainian enterprise is shall be officially register to have the power. The most senior corporate officer is indicated in Governmental register of Ukrainian companies. Such information is publicly available. Other very important thing is that CEO of Ukrainian company is the one who responsible for filing and paying taxes on time. So from one hand manager has some right to act from the name of enterprise, from other hand such person has some obligations to the state. But any way it is impossible that the company has no director. Consider also that it is impossible to establish a company in Ukraine with no CEO. For every company it is a must to have a director. The removal of manager can be needed during company acquisition and after due diligence in Ukraine.

How to change the head or director of Ukrainian company?

It happens that manager of a company does not satisfy the owners of the company any more and has to be dismissed. In this case shareholders of the company must call for the general meeting and approve the appropriate decision which is called Protocol or Minutes of meeting. So called general meeting of owners usually must be announced a month before it will take place. The required number of votes to change the head of the company is determined by the charter of the company. But it can not be less that 50%. Higher percentage of votes can be determined by the Charter of Ukrainian enterprise. Consider also that when dismissing a CEO, it is necessary to decide on a new one. Other fact is that manager can not be changed in one day. For example, if shareholders dismiss director on 1-st of January so the new director can be appointed only from the second of January. It is to be mentioned in the decision of general meeting of shareholders. It is also possible to approve decision that determine on a director change in the future.

Minutes of general meeting of shareholders shall be in the form of a single document. Protocol must be signed by all the shareholders that are present during this act. Signatures shall be certified by the notary. In the case if share owners of Ukrainian company do not want to travel to Ukraine in order to change director, such a document can be also made outside of Ukraine. But notarization is a must any way and may require an apostille. Please remember that all the documents must be translated in Ukrainian language. Minutes can also be signed by representative under a power of attorney.

After the Protocol was properly made and signed, documents can be submitted to state registrar of legal entities of Ukraine. The following documents are provided:

  • Protocol;
  • Registration form (card) where new CEO is mentioned;
  • Power of attorney (is the documents are submitted by representative);

Consider also that if new manager of the company is a foreigner, first Tax Id is required.

Usually it takes not more than a day for a governmental officer to write changes in the register of companies. The confirmation of CEO change is conforming information in the register of companies. Next day after the registration of such changes, the state registration officer shall issue a new company registration certificate where the new director is mentioned.

Please note that it is not required a signature on protocol from previous director or chief of the company. So director of Ukrainian limited liability company can be dismissed without his consent. But still it is recommended that the director (who is dismissed) to sign such a decision.

Next steps after change of CEO of Ukrainian enterprise

Right after the change of CEO has been made it is possible to submit documents to the bank. It is very important to be done as soon as possible. A new chief also has to make an order or an act (so called nakaz) under which director is appointed. First new manager shall go to the notary to certify his signature for financial documents. Notary officer shall make a card with the sample of signature and this card shall be submitted to bank. Right after new CEO shall obtain his digital signature, passwords and login details.

Power and responsibility of director of Ukrainian company

Chief executive officer of Ukrainian enterprise shall act under articles of association or statute, Civil code of Ukraine, Business code of Ukraine and other laws. So it is possible to institute some limitations. For example, if you are an owner of Ukrainian limited liability company and you want director of a company to get a permission to sign contracts or agreements worth more than 10 000 dollars, it can be done. Any limitations can be made.

If you are a shareholder in Ukrainian company and you do not like how company is managed or if you are director of Ukrainian company and you want to quit we can support you in every case.


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