Amending the deed of company formation according to the new Civil Code

After that the new Civil Code (hereinafter”CC”) came into effect the deed of formation of business organisations and cooperatives shall be aligned with the legal provisions in force.

The deed of company formation shall be amended in accordance with CC if the provisions are to be changed by the members for any reasons (e.g. change of seat, branch creation etc.)

Section 12 of the Act CLXXVII of 2013 on the transitory and authorising provisions related to the entry into force of the New Civil Code defines the cases and the deadline until which the business organisations and cooperatives shall amend their deeds of company formation.

This is only obligatory for all companies with different legal forms if the deed of company formation (company contract, deed of foundation, articles of association) contradicts the obligatory provisions of the Civil Code. The amendment is not obligatory if the deed of company formation relates to the act in force at the time of its foundation (Act on business associations) or the Act on cooperatives.

The requests for amendments that are in accordance with the deeds of company formation defined by the new CC may be handed in the company court with no cost via a legal representative electronically.

General and limited partnership

The deadline of the obligatory amendments concerning these legal forms is 15 March 2015, thus the request for amendment shall be handed in by 14 April 2015 the latest.

There is no need for amendment - if it is not required due to other changes – if

- it relates to the former Act on business associations, or

- the executive officer is called a sales manager or representative not a business manager

The general and limited partnerships that are established by a deed of company formation in accordance with the obligatory provisions of the Civil Code in force, are not obliged to amend the deed of company formation until 15 March 2015 if there are no other reasons.

The general and limited partnership companies are kindly asked  – if needed – to hand in the requests for amendment before 15 March 2015, do not wait until the last moment.

Cooperatives

The articles of association shall be in accordance with not only the new CC but the Act X of 2006 on cooperatives when changing the articles (student cooperation, social and labour cooperative, agricultural cooperative).

Pursuant to section 18 of the Act CLXXVII of 2013 on the transitory and authorising provisions related to the entry into force of the New Civil Code – with the exception of housing cooperatives – all cooperatives shall accept their articles of association in accordance with CC by 15 June 2015 the latest, and the request for amendment shall be handed in within 30 days – by 15 July 2015 the latest.

There is no need for the amendment of the articles of association - if it is not required due to other changes – if

- it relates to Act X of 2006 on cooperatives or

- the executive officer is called a managing director, the contribution of assets is called shares.

It is advisable to amend the articles of association at the time of the acceptance of the balance sheet.

It is an important change compared to the previous that the members are excluded by the court not by the cooperative; the general assembly shall be summoned on the request of 5% of the members. The repeated general assembly may be summoned between the 3rd and the 15th day after the original assembly without a quorum.