TL;DR
- Armenia formally recognized a voluntary Corporate Governance Code in June 2024, embedding international best-practice principles into national law guidance for boards and shareholders (KPMG).
- Listed companies are expected by the market to follow the Code’s recommendations on board independence, disclosure, and oversight—even though compliance remains voluntary (Armenian Law Guide).
- LLCs with more than 20 participants must establish a Supervisory Commission (audit committee) for financial oversight (RA LLC Law/Civil Code).
- JSCs with more than 50 shareholders must form a Board of Directors, enabling a two‑tier oversight structure with management below (RA Civil Code, Art. 115).
- All Armenian companies must disclose their ultimate beneficial owners (UBOs) to the State Register, with the regime in place since 2023 (Open Ownership).
Last updated 21 October 2025
Why this matters: Armenia’s governance framework has sharpened notably, with a new Code guiding boards and clearer oversight requirements for LLCs and JSCs. As more companies incorporate—over 11,700 new entities registered in 2022—strong company management in Armenia is a growing competitive necessity (World Bank/CEIC).
Use this guide to align your structure and disclosure practices with current Armenian law and market expectations. If you’re still planning your setup, see our step-by-step business registration primer and our insights on investing in Armenia and taxes in Armenia.
Table of Contents
- June 2024 reform: formal recognition of a voluntary Corporate Governance Code
- Implications for listed companies: recommended standards
- disclosure and market expectations
- LLC management in Armenia: participants
- executive bodies and mandatory Supervisory Commission (>20 participants)
- Joint‑Stock Companies (JSCs): Board of Directors requirement when >50 shareholders and two‑tier oversight
- Executive management and officers: appointment
- duties
June 2024 reform: formal recognition of a voluntary Corporate Governance Code
On 8 June 2024, Armenia amended its Civil Code to formally recognize a voluntary Corporate Governance Code. While non-mandatory, the Code harmonizes Armenian practice with international standards on board effectiveness, shareholder rights, transparency, and control systems (KPMG). This move gives companies an authoritative framework for improving governance without imposing blanket statutory obligations.
Implications for listed companies: recommended standards
For companies listed on the Armenian Stock Exchange, investors and the market generally expect adherence to the Code’s recommendations—such as independent and skilled boards, structured risk oversight, and robust disclosure—even though the Code itself is voluntary (Armenian Law Guide; KPMG). Boards should map current practices against the Code’s provisions and disclose how they comply or explain deviations in line with “comply or explain” expectations common to global markets (KPMG).
disclosure and market expectations
Armenia’s transparency regime has tightened. Most companies must disclose ultimate beneficial owners (UBOs) to the State Register, a regime operational since 2023, improving visibility of control and reducing hidden ownership risks (Open Ownership). For listed companies, timely corporate change notifications and clear governance reporting are increasingly expected by regulators, investors, and counterparties (Armenian Law Guide).
LLC management in Armenia: participants
For Armenian LLCs, the General Meeting of Participants is the supreme body and typically approves the charter, appoints and removes the executive body, and decides on key matters such as reorganization and liquidation as set out in law and the company’s Articles of Association (RA LLC Law/Civil Code). An LLC may also establish a company board if its charter provides for one; otherwise oversight beyond the General Meeting is handled through the executive body and, where required, the supervisory/audit function (RA LLC Law/Civil Code).
executive bodies and mandatory Supervisory Commission (>20 participants)
LLC day‑to‑day management is conducted by the executive body (e.g., General Director/CEO). The executive can be a single individual or, if the charter permits, a management company/individual entrepreneur appointed by the General Meeting (RA LLC Law/Civil Code). If an LLC has more than 20 participants, it must establish a Supervisory Commission (often referred to as an audit committee) to oversee financial reporting and control procedures, adding an independent layer of accountability (RA LLC Law/Civil Code).
Joint‑Stock Companies (JSCs): Board of Directors requirement when >50 shareholders and two‑tier oversight
JSCs are governed by the General Meeting of Shareholders, which retains control over foundational decisions (charter approval, capital changes, reorganization/liquidation, and elections of the supervisory body and auditor) per law and the charter (RA Civil Code). Where a JSC has more than 50 shareholders, a Board of Directors (supervisory board) is mandatory, creating a two‑tier structure: the board supervises, while the executive body manages daily operations (RA Civil Code, Art. 115).
| Company type | Supreme body | Mandatory oversight trigger | Daily management |
|---|---|---|---|
| LLC | General Meeting of Participants (RA LLC Law/Civil Code) | Supervisory Commission required if >20 participants (RA LLC Law) | Sole executive body or permitted management company (RA LLC Law/Civil Code) |
| JSC | General Meeting of Shareholders (RA Civil Code) | Board of Directors required if >50 shareholders (RA Civil Code, Art. 115) | Sole or collegial executive body under the board’s oversight (RA Civil Code) |
Executive management and officers: appointment
Appointment mechanics are set by law and the charter. In both LLCs and JSCs, the General Meeting typically appoints and removes the sole executive body (CEO/General Director) unless the charter allocates this right to the Board of Directors in a JSC. The charter may also allow appointing a management company or individual entrepreneur as the executive body (RA Civil Code/LLC Law). These arrangements should be mirrored by clear internal regulations, especially for listed issuers aligning with the 2024 Code’s good‑practice recommendations (KPMG).
duties
Across LLCs and JSCs, the executive body manages day‑to‑day operations and represents the company without a power of attorney, including recruiting staff, entering contracts, and opening bank accounts as permitted by the charter and law (RA Civil Code/LLC Law). The Board of Directors in a JSC exercises overall supervision—convening meetings, overseeing major transactions within its remit, and directing strategic questions not reserved to the General Meeting (RA Civil Code, Art. 115).
Directors and officers should operate with diligence, loyalty, and accountability consistent with the voluntary Corporate Governance Code’s principles, including risk oversight and transparent reporting (KPMG). In larger LLCs, the Supervisory Commission provides financial oversight and control checks, reporting to participants as required by law (RA LLC Law).
Compliance responsibilities now extend to beneficial ownership reporting to the State Register, which helps verify who ultimately controls or benefits from the company—a key part of Armenia’s transparency drive in effect since 2023 (Open Ownership). Coordination with finance and legal teams is advisable to dovetail UBO filings with annual corporate updates and tax submissions (taxes in Armenia).
If you are considering entering the market or reorganizing your group, our team can help you align company management in Armenia with the latest law and the 2024 Code. Explore our guides on investing in Armenia and business registration, or contact us for tailored advice.
FAQ
Is Armenia’s Corporate Governance Code mandatory?
No. The Code, formally recognized in June 2024, is voluntary but serves as a benchmark for best practice and market expectations, especially for listed issuers (KPMG).
When must an LLC create a Supervisory Commission?
An LLC with more than 20 participants must establish a Supervisory Commission (audit committee) to oversee financial controls (RA LLC Law).
When is a JSC required to have a Board of Directors?
A Board of Directors is mandatory when a JSC has more than 50 shareholders, creating a two‑tier governance structure (RA Civil Code, Art. 115).
Who appoints the CEO or executive body?
Usually the General Meeting appoints and removes the sole executive body, unless the charter authorizes the Board (for JSCs) to do so. A management company or individual entrepreneur may be appointed if the charter permits (RA Civil Code/LLC Law).
What disclosure is required about beneficial owners?
As of 2023, Armenian companies must report their ultimate beneficial owners to the State Register to improve corporate transparency (Open Ownership).
Conclusion
Armenia’s governance landscape now blends clear statutory rules (LLC/JSC oversight thresholds and UBO disclosure) with a voluntary but influential Corporate Governance Code. Aligning your charter, board practices, and reporting with these standards will strengthen company management in Armenia and meet investor expectations. For implementation support, contact us.
