On 5 January, 2006, President Vladimir Putin signed into law amendments to the Russian Federation Law On Joint Stock Companies (the JSC Law) that grant super-majority shareholders (those holding over 95%) the absolute right to ‘squeeze out’ (or ‘cash out’) all minority shareholders.
The new rule applies to all open joint stock companies (JSCs), where the majority shareholder meets the required 95% threshold after 1 July. However, to be able to redeem all minority shareholdings under the new rule, the purchaser must cross the 95% threshold through acquisition of shares through a voluntary or mandatory public offer made after 1 July.
