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Virtual meetings, electronic execution now permanent

Virtual meetings and electronic execution are now permanent under new amendments to the Corporations Act 2001.

The Corporations Amendment (Meetings and Documents) Act 2022 (the Act) passed both Houses on 10 February 2022 and received assent on 22 February 2022.1

The Act makes permanent the temporary changes contained in the Treasury Laws Amendment (2021 Measures No.1) Act 2021, and establishes a permanent mechanism to allow companies and registered schemes to:

  • hold hybrid (in person and remote) meetings, and
  • use technology to execute, sign and share company and meeting-related documents.

Queensland Law Society previously supported these temporary measures (see our previous reports here and here), reporting that the temporary changes were widely supported by the legal profession and other key stakeholders.2

Key takeaways:

  • The Act will apply to documents sent and meetings held on or after 1 April 2022, after the temporary measures expire on 31 March 2022.3 As to electronic execution, the Act will apply to documents executed on or after 23 February 2022.4
  • A person may sign certain company and meeting-related documents, including a deed, using electronic means, provided the method of signing identifies the person and indicates the person’s intention.5
  • A company, responsible entity of registered schemes and disclosing entities may provide meeting-related documents, including notices of meetings and notices of a resolution, to a person electronically.6
  • A company and registered scheme can hold physical meetings, hybrid meetings and a wholly virtual meeting, provided the governing constitution permits virtual meetings.7 All meetings must give the members as a whole reasonable opportunity to participate.8
  • The Act adopts a technology neutral approach and does not mandate any particular type of technology.
  • The Act does not prevent companies and registered schemes from signing documents in the traditional manner or using traditional practices (for example, wet-ink signatures).9 The Act also clarifies that members may elect to receive relevant documents in physical form.10
  • The provisions relating to meetings and electronic communication must be reviewed no later than the earliest practicable day after the end of two years after the Act commences.11

In its passage through both Houses, a change was introduced providing that the amendments facilitating wholly virtual meetings cease to have effect if a report on the review of the operation of those provisions is not tabled in Parliament within 30 months of the commencement of Schedule 1.12

The amendments also ensure that the panel undertaking the review is independent and has the necessary experience to take into account the interests of companies, registered schemes and their members, including a member with experience representing the interests of shareholders.

Yale Hudson-Flux is a graduate intern at Queensland Law Society.

Footnotes
1 Parliament of Australia, Corporations Amendment (Meetings and Documents) Bill 2021.
2 Kate Brodnik, Corporations Act pandemic amendments end Monday; Matt Dunn, Senate vote throws extension of corporations’ e-signing of documents into turmoil.
3 Corporations Amendment (Meetings and Documents) Act 2022 s2; Explanatory Memorandum, Corporations Amendment (Meetings and Documents) Bill 2022, p3.
4 Corporations Amendment (Meetings and Documents) Act 2022 s2.
5 Ibid s110A.
6 Ibid ss110C, 110D; Explanatory Memorandum, Corporations Amendment (Meetings and Documents) Bill 2022, p12.
7 Corporations Amendment (Meetings and Documents) Act 2022 ss249R, 252P.
8 Ibid ss249S, 252Q.
9 Explanatory Memorandum, Corporations Amendment (Meetings and Documents) Bill 2022, p9.
10 Corporations Amendment (Meetings and Documents) Act 2022 s110D.
11 Ibid s1687J.
12 Supplementary Explanatory Memorandum, Corporations Amendment (Meetings and Documents) Bill 2021, p3.

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