At February 26 sitting, the NA Standing Committee on State and Legal Affairs debated in the first reading the revised the draft of the law On Making Addenda to the RA Civil Code. The Deputy Governor at Central Bank Armen Nurbekyan presented it. As he informed, the initiative was supplemented by the proposed addendum to the Law On State Registration of Legal Entities, Separated Subdivisions, Institutions and Individual Entrepreneurs. In particular, it is proposed to make addendum to the Article 247 of the Civil Code with a new Part 3: In order to ensure the fulfillment of credit obligations of legal entities to financial organizations, as provided for in Part 1 of Article 35.1 of the Law “On State Registration of Legal Entities, Separated Subdivisions of Legal Entities, Institutions and Individual Entrepreneurs,” the pledgee’s pledge rights over pledged property owned by other persons shall not terminate (including obligations ceded to the Government of the Republic of Armenia based on transactions for the transfer of monetary claims (property rights), regardless of the fact of recognition of the registration of such legal entities in accordance with the procedure established by the above-mentioned law, except for cases when the financial losses of the pledgee arising from the obligation specified in this paragraph have been fully or partially recovered (compensated) in any way in accordance with the procedure and amount agreed with the pledgee.”
The draft aims to provide financial organizations and the Government of the Republic of Armenia with the opportunity to exercise their right to collateral in the current situation, as well as to protect the financial system from possible negative consequences.
The Committee Chair Vladimir Vardanyan clarified the proposed amendment noting: “The regulations that we have envisaged in the law On State Registration of Legal Entities, Separated Subdivisions, Institutions and Individual Entrepreneurs are aimed at providing the necessary field of activity for the law firms of Nagorno-Karabakh in the Republic of Armenia, and the goal is for the latter to be able to continue their activities normally. But these regulations are not in any way aimed at any company avoiding liability, because a right cannot arise from a violation of the law. And in all cases when we have a situation where there is a factual obligation, including one secured by collateral, they must be fulfilled. This is an important initiative, and we must proceed from the assumption that mere failure to register cannot serve as a basis for malicious avoidance of fulfilling obligations.”
The Committee endorsed the draft. It is designed to include in the draft agenda of the NA upcoming regular sittings.
Read also
RA NA