The State seeks to amend the law that will allow public firms to have the option to hold virtual annual general meetings (AGMs).
If MPs approve changes to the Companies Act 2015, this will allow companies to choose either to have virtual, physical or hybrid AGMs.
The Bill titled The Business Laws (Amendment) (No. 2) Bill, 2020, under section 14, it says:
“Section 3 of the Companies Act is amended —
(a) in the definition of the term “general meeting” by inserting the words “which may be a physical, virtual or hybrid meeting’ immediately after the words “general meeting;
(b) by inserting the following new definitions in proper alphabetic sequence-
“hybrid meeting” in relation to a company general meeting means a meeting where some participants are in the same physical location whole other participants join the meeting through electronic means including video conference, audio conference, web conference or such other electronic means;
“virtual meeting” in relation to a company general meeting, means a meeting where all members join and participate in the meeting through electronic means including video conference, audio conference, web conference or such other electronic means.”
The Bill also seeks to amend section 283 and 285 of the Companies act where it gives companies the option to choose whether they can have a hybrid or a virtual meeting and specify the means of joining and participating in it.
The proposed changes come after companies moved to holding meetings online that was necessitated by the COVID-19 pandemic. Companies have already changed their internal regulations to include holding these virtual meetings.
This will be a win for companies, especially on cost cuttings. AGMs usually require booking hotel conference rooms, paying for meals and for physical copies of the meeting which can add up for a company with a lot of shareholders.
