Latest update: Virtual AGMs, electronic document execution and digital shareholder communications revert to pre-COVID form
Temporary measures permitting Australian corporations to hold virtual and hybrid meetings and enabling the electronic execution of documents and digital shareholder communications, have now expired.
As a result, the Corporations Act has reverted to its pre-COVID form.
- There is once again legal uncertainty over the validity of virtual-only AGMs.
- Hybrid AGMs may not be allowed if not expressly permitted by a corporation’s constitution.
- Shareholders who attend AGMs electronically will not count towards quorum.
- There is once again uncertainty about the legality of company officers executing documents electronically.
- Full AGM notices of meeting will need to be sent to shareholders.
This follows the Federal Government attempting unsuccessfully last week to pass the Treasury Laws Amendment (2021 Measures No. 1) Bill that would have extended the ability to hold virtual AGMs, execute documents electronically and use technology to communicate with shareholders to September 2021. The Bill also would have made changes to the continuous disclosure regime.
No vote on the Bill is now possible until 11 May at the earliest.
Governance Institute will continue to advocate for resolution of this uncertainty. We remain committed to working collaboratively with the Government, the Opposition, the crossbench and all industry stakeholders to enhance the digital shareholder experience.
We will keep members and the broader network updated on this important issue.