Banking conditions of conservative storage (escrow) as a mechanism for implementation of forced exchange of shares (squise-out) in Ukraine: problematic issues

Abstract

It is shown that this type of accounts was actually implemented for a specific purpose – the implementation of compulsory share purchase (squeeze-out) in Ukraine, which left its imprint on the inconsistency with the traditions of global regulation. In Ukraine the conclusion of contracts for the opening of escrow accounts is usually made between the client of the bank (the account holder) and the bank itself, without participation and, accordingly, without taking into account the interests of the beneficiaries; accordingly the account belongs to the named «holder». In the context of the implementation of the squeeze-out procedure, the issue of the proper identification of minority shareholders who sell shares is not resolved, which is likely to lead to difficulties in obtaining funds for these shares. Neither the laws nor the subordinate regulation are aimed at protecting the rights of minority shareholders in the process of squeeze-out.