Legislative amendments passed by the Verkhovna Rada last year took effect on May 1.

Lawyers said that the most important provisions of the law on amending some Ukrainian laws regarding protection of investors' rights is the introduction of the derivative suit as a new way to protect investors' rights. This scheme allows punishing managers of economic entities for losses caused by their actions of neutrality. Shareholders holding 10% and more of the total share capital have the right to bring a lawsuit to court on behalf of the company seeking to refund losses caused by a company manager.

Partner of Asters law firm Oleksiy Demyanenko said that the derivative suit could be used in corporate conflicts to put pressure on directors and block operations of companies.

Senior Lawyer in Aequo law firm Oksana Krasnokutska said that there could be many cases of abuse of power at the initial stages with the derivative suits.

The law also introduces the institution of independent directors of joint-stock companies, improves the procedure for determining the market value of securities, revokes a liability to pay dividends via the depository system and gives alternative ways of paying dividends. The document also improves a mechanism for giving consent for related party transactions. It also eliminates restrictions for the maximum number of shareholders for private joint-stock companies and bans joint-stock companies from purchasing their own shares when the shares are put up for sale. The law obliges public joint-stock companies to pass the procedure for including shares into exchange listing and be listed on at least at one Ukrainian exchange. The document establishes a liability for public joint-stock companies to have their own website, not a web page, and to place there information prescribed for publication by the law on joint-stock companies. Private joint-stock companies can post information on their web pages.

Krasnokutska said that joint-stock companies should bring their regulations in line with the new provisions of the law on joint-stock companies.

"The clear differentiation of supervisory board members is introduced for setting a voting procedure for transactions involving self-interest. From May 1 the decision to enter into these arrangements can be taken even by one member of the supervisory board. Members of the supervisory board (who stand to benefit from the transaction) cannot vote," she said.

Related party transactions are transactions of companies with their managers, shareholders who hold 25% and more shares in the companies and their affiliated persons.