Under the social distancing measures that are currently in place, it is difficult for shareholders to physically gather with members of the board at annual general meetings.
The Corporations Act 2001 provides that the Minister may, by legislative instrument, exempt specified classes of persons from the operation of specified provisions of the Act or Corporations Regulations 2001.
The purpose of the instrument-making power is to provide the Minister with a temporary power to provide short-term regulatory relief to those who are unable to meet their obligations under the Act or the Regulations due to the Coronavirus, and short-term regulatory changes to facilitate continuation of business or mitigate the economic impact of Coronavirus.
The relevant Minister, The Treasurer, the Hon Josh Frydenberg MP on 5 May announced details of changes implemented in the Corporations Act and Regulations to make it easier for business to operate and meet statutory requirements during COVID-19.
The changes will allow companies to convene annual general meetings, and other meetings prescribed under the Corporations Act, entirely online rather than face-to-face and the changes will also give businesses certainty that when company officers sign a document electronically, the document has been validly executed.
Under the changes, company boards will be able to:
Meetings must continue to provide shareholders with a reasonable opportunity to participate. As a result, shareholders will be able to put questions to board members online and vote online.
Further changes will also allow company officers to sign a document electronically. Previously, in a number of cases, signatories were required to sign the same physical document. This will ensure that documents are able to be properly executed at a time when ordinary business operations have been disrupted.
These changes will be in effect for six months from 6 May 2020.
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