Publications Share inheritance and LLC membership

Under article 1216 of the Ukrainian Civil Code, inheritance is the transfer of the rights and obligations of a deceased person to his or her heirs.

There is, however, an exception to the above rule, namely that the non-property right to participate in the society is not included in the inheritance.

From the above and the systematic analysis of the rules of civil law, it transpires that the heir of a member of a limited liability society, as a result of the inheritance and its subsequent formation, acquires the right to a part of the statutory capital of the society, not the right to be a direct participant.

This position is confirmed by article 100 of the Ukrainian Civil Code, which states that the right to participate in societies is a personal non-property right and may not be transferred to other persons.

It is important to bear in mind that only a member of a limited liability company has the right to influence the decision-making of a society, including the decision to dissolve/reorganize a society. In order for the heir of the deceased participant to join a limited liability company, the following actions must be taken:

1. To acquire the right to inherit part of the statutory capital of the society. To this end, a declaration of succession must be submitted to the notary.

2. Obtain a Certificate of Succession indicating the heir’s ownership of a portion of the statutory capital of a limited company.

3. If the deceased was the only member of the limited liability company, the heir must issue a public record according to which the heir is the new and sole participant of the limited liability company. It is then necessary to revise the statute of the limited company and record the above changes. If the deceased was not the only member of the limited liability company, it is necessary to convene the meetings of the members of the society and to vote on the accession of the heir of the deceased member to the society. In the event of refusal, the heir of a member of the company is entitled to payment to him of the equivalent part of the statutory capital.

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