On 13 August 2021, the Treasury Laws Amendment (2021 Measures No.1) Act 2021 (Cth) came into effect reinstating provisions in the Corporations Act 2001 (Cth) (the Act) allowing companies to undertake some activities electronically.
Practically, the amended Act extends a company’s ability to undertake some key activities by electronic means, even if the company constitution does not specifically permit, including:
- executing documents – including deeds provided an appropriate method is followed;
- holding meetings including general meetings and annual general meetings;
- providing notices; and
- keeping minutes.
There are specific requirements around each of these and care should be taken to comply with the requirements of the Act for each activity.
For example, in general meetings, the technology utilised to facilitate the meeting must provide shareholders the opportunity to meaningfully participate, which may include the ability to speak and ask questions as well as to opportunity to ask questions in writing, and vote in real time – even though voting prior to the meeting is also permitted under the amended Act.
The amendments to the Act are welcome after a gap was left after the expiry of the previous Corporations (Coronavirus Economic Response) Determination (No 3) 2020 (Cth) on 21 March 2021, a gap which created uncertainty and significant practical issues.
The amendments to the Act will remain in force until 31 March 2022, unless further amended.
Earlier this year, the Government announced that it intends to implement permanent legislation providing for the electronic execution of documents and holding of meetings using technology. In preparation for this permanent reform, the Government has released an exposure draft bill.
In the meantime, for companies that want to ensure electronic meetings can continue into the future, they may wish to consider amending their constitution to allow this now.
The team at Griffin Legal can assist with this and a wide range of corporate governance issues.