The rules of some companies and other organisations require them to hold annual general meetings. Since lockdown began in March, those organisations have grappled with how to comply with these requirements whilst observing the government’s lockdown rules and subsequent Coronavirus restrictions.
Legislation was finally introduced on 25 June 2020 to bring in temporary changes on how to hold annual general meetings which override the company’s rules. Some of these changes were extended on 29 September and again on 26 November 2020. The new provisions seek to allow organisations to facilitate meetings having regard to the safety of their members, shareholders, directors and employees during the COVID-19 pandemic.
The changes apply to incorporated companies, charitable incorporated organisations and community interest companies (organisations) but do not apply to unincorporated charities or associations.
What are the changes to holding annual general meetings?
Notwithstanding anything in the organisation’s constitution, general meetings which were, or are, held between 26 March and 30 March 2021, extended from 30 December 2020 (Relevant Period):
- need not be held in any particular place;
- may be held by electronic or other means;
- may allow vote to be cast by electronic or other means;
- may be held without any number of participants being together in the same place; and
During the Relevant Period, members and shareholders do not have the right to:
- attend such meetings in person;
- participate in the meeting other than by voting; or
- vote in any particular manner.
If Organisations were required by their constitution to hold a general meeting by a specific date between 26 March and 30 March 2021, they were able to extend such deadline to no later than 30 March. All AGMs due to be held after 30 March 2021 must be held within the time limits specified in the organisation’s articles or rules.
The provisions are retrospective so that any Organisation which held their AGM after 26 March 2020 in accordance with the new temporary rules will be deemed to have held the meeting lawfully.
The Secretary of State may extend the Relevant Period past 30 March but no later than 5 April 2021 depending upon conditions at that time.
What to do if you need to hold a General Meeting:
- Your starting point should always be to review your Organisation’s constitution to see whether electronic members meetings are prohibited (we recommend this being the starting point irrespective of the position under the Act);
- You may wish to discuss with your directors, members or trustees alternative means of holding meetings as soon as practically possible and consider whether the meeting will be accessible to all members. Bear in mind that not everyone will be familiar with and/or have access to platforms such as Zoom or Skype; and
- Keep in touch with your fellow trustees/members to decide how any upcoming meetings will proceed (in particular when it comes to voting).
If you have any concerns regarding meetings that were held or you propose to hold, during the Relevant Period, please contact a member of our Corporate team.
This blog was co-written by Clare McCauley (LLP Partner) and Shaun Piesley (Trainee Solicitor).