Distribution of powers between the executive body and general meeting of shareholders of the company is one of the challenging problems business companies have to deal with.

To illustrate it let’s consider the following situation. A certain company holds shares of another company; for better understanding let’s take an example of a main company having interest in a branch company though this problem arises regardless of the size of the share and influence of one economic society on another society shares of which it holds.

At general meetings of the branch society works an executive body (as a rule the manager) acting in the name of the main company without warrant. The problem is that the provisions of the law on “Business companies” (hereinafter – the law) do not provide a clear understanding of items on the agenda of the general meeting of the branch company with regard to which the manager of the main company can take decisions on his own and items which are within the scope of competence of the general meeting of the main company.

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