End to temporary relief allowing virtual meetings and return to historical continuous disclosure rules
Corporate News - 22 March 2021
On 18 March 2021, the Australian Senate agreed to defer ongoing discussion of the Treasury Laws Amendment (2021 Measures No. 1) Bill 2021 (Bill) until the first sitting day of the Senate in August 2021. The disappointing delay in the consideration and approval of the Bill means that from after today’s date, until the adoption of any new legislation:
- notices of meeting for public companies must be posted or electronically despatched to shareholders (according to shareholders’ stated preferences) as was historically done prior to the adoption of the Corporations (Coronavirus Economic Response) Determination (No. 3) 2020 (Determination No. 3); and
- general meetings must be held at a physical location and cannot be held entirely online or ‘virtually’ (although providing a virtual participation option for a physical meeting remains possible).
Clients should note these revised requirements as it has the potential to add time and postage cost to the holding of shareholder meetings convened after today’s date.
The delay in approving the Bill also means that the liability standard for non-disclosure under the continuous disclosure rules will revert to the position prior to Determination No. 3. This means that the potential liability remains for misleading and deceptive conduct where an entity or officer has failed to disclose an update in respect of price sensitive information even in the absence of “knowledge, recklessness or fault”.
Please contact us at our Perth office on +618 9321 4000 or our Melbourne office on +613 9111 9400 if you require any further advice on any of the issues raised in this article.