Public companies with a December 2019 year-end would usually have until 31 May 2019 to hold their Annual General Meeting (AGM). The restrictions on travel and on large gatherings in place as a result of COVID-19 may make it difficult to meet this requirement, and therefore ASIC have confirmed that they will provide relief from this requirement.
- While ASIC cannot change the requirements of the Corporations Act 2001, it has confirmed that it will adopt a “no action” approach, as long as an AGM is held by 31 July.
- The Corporations Act 2001 is ambiguous about whether “virtual” or “hybrid” meetings, which allow shareholders to attend remotely via online facilities, are permissible. ASIC has confirmed that it supports the use of such technology, and will adopt a similar “no action” position on AGM’s held using such methods, as long as:
- Entities consider the requirements of their own constitution to determine whether AGMs using this technology are permissible
- The online facilities should allow all shareholders to participate in the meeting by being able to question the directors and auditors, and to participate in voting
Commenting on ASIC’s position, Ralph Martin, National Technical Director of RSM Australia, said
This is a practical and sensible approach to the problems with AGMs caused by COVID-19, and ASIC should be commended for acting quickly to provide relief for affected entities. We understand that ASIC are considering the financial reporting and AGM obligations for public companies with 31 March or 30 June year-ends, and we encourage them to adopt a similarly pragmatic approach for those entities too.
For more information regarding this extension, please contact your local RSM office today.