ASIC adopts a ‘no action’ policy in relation to virtual AGMs and also extends time for holding AGMs for some entities
Due to snap lockdowns and restrictions on gatherings and travel during the COVID-19 pandemic, many public companies are not able to hold AGMs in person. Temporary modifications to the Corporations Act 2001 were made at the start of pandemic, which permitted entities to hold virtual AGMs, but these expired 21 March 2021 and legislation to extend these temporary modifications is not yet final.
In its Media Release 21-061, ASIC therefore noted its ‘no action’ policy in relation to public companies holding virtual AGMs. This is a temporary measure to remove the legal uncertainty around the validity of virtual meetings during this COVID-19 period. The ‘no action’ position applies to virtual AGMs and other company meetings held between 21 March 2021 and the earlier of:
- 31 October 2021, and
- The date that legislation is passed by Parliament relating to the use of virtual technology.
The ‘no action’ position:
- Supports the holding of meetings using virtual technology
- Facilitates dispatching meeting notices electronically (including supplementary notices), and
- Allows more public companies an additional 2 months to hold their AGMs.
How to hold a virtual AGM?
Entities should refer to ASIC’s guidelines for investor meetings using virtual technology for guidance on how to conduct meetings using virtual technology.
Entities with year-ends between 7 January 2021 and 7 April 2021 have more time to hold AGM
Public companies are required to hold an AGM within five months of the end of their financial year. ASIC had previously taken a ‘no action’ position for entities with years ending 31 December 2019 until 7 January 2021 to hold AGMs up to seven months after year-end.
Media Release 21-061 now extends ASIC’s ‘no action’ position for entities with financial years ending between 7 January 2021 and 7 April 2021. These entities will also have an extra two months to hold their AGMs.
Please refer to the Media Release for more information.