Temporary relief to hold virtual meetings
Corporate News - 13 August 2021
Earlier this week, Parliament passed Treasury Laws Amendment (2021 Measures No. 1) Bill 2021 (Bill) (with some minor amendments) temporarily permitting electronic meetings.
Helpfully, once Royal Assent is obtained, for this AGM season and until 1 April 2022:
- Meetings (including AGMs) can be held using technology (as virtual or hybrid meetings), provided that ‘persons entitled to attend the meeting as a whole’ have a reasonable opportunity to participate. This means that members must be given the opportunity to speak and ask questions orally as well as vote in real time or prior to the meeting, at the election of the member. Note that ASIC will also be able to permit a specific entity or class of entities to hold a virtual meeting despite it not being permitted in an entity’s constitution where it is unreasonable to expect that the meeting be held at a physical venue because of a situation beyond the control of the entity/entities.
- All persons participating (whether attending virtually or physically) are deemed ‘present’ for quorum purposes.
- Voting must be by a poll if virtual meeting technology is used.
- Meeting-related documents may be given electronically or by providing the recipient (by means of electronic communication or otherwise) sufficient information to allow the recipient to access the document electronically provided that a) it is reasonable to expect that the document would be readily accessible so as to be useable for subsequent reference; and b) the recipient has not exercised their right to 'opt in' to receive the materials in hard copy. This applies to all meetings whether held using electronic technology or in person.
- Where virtual meeting technology is used to hold the meeting, documents can be tabled at the meeting by providing the documents to the person in advance of the meeting or by making the documents accessible to persons attending the meeting (whether physically or using virtual meeting technology) during the meeting.
- Meeting minutes may be recorded and kept electronically.
- ASIC will have additional powers to provide individual or class order relief to enable an AGM to be held late where there are exceptional circumstances beyond the company’s control.
These changes will certainly assist companies for upcoming AGMs whilst Government restrictions remain in place in a number of parts of Australia. The Government has foreshadowed that permanent changes to the Corporations Act 2001 (Cth) (Corporations Act) will be considered later in the year.
We recommend that all companies begin planning their AGM early to ensure that relevant virtual/hybrid meeting procedures and processes are in place and will facilitate members’ fair participation and a smooth meeting. We also strongly encourage companies to engage with their share registry early to prepare proxy forms and be prepared to despatch meeting materials in the modified manner.
We are happy to assist all clients with preparing AGM materials for the upcoming season so please contact us in our Perth office or Melbourne office for further advice by clicking here.
The Bill also dealt with electronic execution and permanent changes to the continuous disclosure laws. These issues will be summarised in a separate article.