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01. Are companies required to hold an Annual General Meeting (AGM)? COVID 19 UPDATE

In general, companies are required by law to hold an AGM every calendar year and not more than 15 months should elapse between one AGM and the next (Section 175 Companies Act).  An AGM is a meeting of members of a company at which the members can ask questions and get information about the company.

New temporary amendments to the Companies Act 2014 regarding AGM’s to address issues created by Covid-19

The Act introduces exceptional provisions for a specific period (August 2020 to 31 December 2020) to the Companies Act 2014 in response to the economic difficulties and risk to human life and public health caused by the Covid-19 disease.  It facilitates with the holding of general meetings including AGMs during the interim period and sets out new interim arrangements as follows: 
It allows companies:

  • the option of holding their 2020 AGM on a date later than their relevant date but not later than 31 December 2020;
  • to hold AGM’s wholly or partly using electronic communication technology with no need for a physical venue, provided all attendees have a reasonable opportunity to participate in the meeting;
  • to lay the financial statements and reports before members at the delayed AGM replacing the timeframe of 9 months (s341(2)) at the meeting;
  • to assist with participation in the AGM by providing or facilitating with the use of electronic communications technology, including a mechanism for casting votes, either before or during the meeting;
  • provide proportionate restriction to ensure identification of attendees and security of the electronic communication technology to reduce risk of data corruption and illegal access;
  • cancel, change venue, change the means of holding the meeting, at any time up to the day before the meeting in order to comply with public health guidelines of the government.

Notice of General Meetings during interim period
The notice to members by companies that hold meetings by electronic means during the interim period must include the following;

  • the electronic platform to be used;
  • details for access to the electronic platform;
  • timeframe for confirmation of attendance;
  • any restriction in place in order to identify attendees;
  • procedure for asking questions;
  • procedure for voting.

02. Can some companies choose not to hold an AGM?

Certain companies, such as a "single member company" and LTDs, may dispose with the holding of an AGM. Special rules apply where a company decides not to hold an AGM.

Single member company - the sole member of a company can decide not to hold an AGM.  The member must write to the company to inform them of their decision not to hold an AGM.  The company is required to send the financial statements and other documents that would normally be sent to the member before the AGM to the member (Section 196 Companies Act).

LTD Company:  All the members of a LTD (where there is more than one member) must approve and sign a written resolution not to hold an AGM.  The resolution must be approved before the latest date for holding the AGM, and each member must confirm in writing that they have received the company's financial statements and that they agree all other matters that would normally be decided at the AGM.  This resolution is as valid as if it had been passed at the AGM (Section 175(3) Companies Act).

 

03. Is notice required for calling an AGM?

Yes. A company is required to give 21 days notice to members and others entitled to notice of the holding of an AGM and of the business to be discussed.  This notice period excludes the day the notice is issued and the day of the AGM (Section 181(3) Companies Act).   

04. What must the notice of the AGM include?

The notice of the AGM should include:  the Date, Time and Place of the meeting and the Agenda (listing items to be discussed and voted on at the AGM).   A copy of the financial statements to be laid before the meeting (circulated in accordance with Section 338 of the Companies Act);  and a note telling the member of their right to appoint a proxy including the proxy form.

05. How do members receive notice of meeting?

The company may serve the written notice on members as follows:

(a)    Hand the notice to the member;

(b)   Send the notice by post;

(c)    Send the notice electronically, if the company’s rules allow.

If the company’s rules do not allow the company to send notice electronically, the members may change the rules.  To do this, the company must put a propose to the members to vote on at an AGM or an EGM.  For the proposal to pass, at least 75% of those voting at the meeting must approve the change.  (Section 218 of the Companies Act 2014 refers).

 

06. Can a company be directed to hold an AGM?

Yes. If a company fails to hold an AGM, any member of the company may apply to the Director of Corporate Enforcement to seek the calling of an AGM. The application should be submitted on a Complaint Form available on the ODCE website.

07. Should AGMs be held in the State?

Yes. AGM’s should be held in the State, except where the Articles of Association allow otherwise and, additionally, all the members agree that the meeting be held outside the State. (Section 176 of the Companies Act).

08. What is a quorum?

A quorum is the minimum number of members who must attend a meeting (in person or by proxy) for it to be a valid meeting. The quorum for (a) a single member company is one member, and (b) all other company types is two members.  However, a company can in its constitution set a higher number as its quorum (Section 182 of the Companies Act 2014).

09. What happens if a quorum is not present?

If a quorum is not present within 15 minutes of the scheduled start time of the meeting, no business can be transacted and the meeting stands adjourned. 

If a quorum is not present at the reconvened meeting within half an hour of the scheduled start time, the members present will be the quorum and the meeting can go ahead.

10. Appointment of a Proxy

Any member of a company entitled to attend and vote at a meeting of the company is entitled to appoint another person as their proxy to attend the meeting.  (Section 183 Companies Act).

11. What rights has a 'Proxy'?

A proxy has the same right as the member that appointed them, to attend, to speak and to vote at the meeting. (Section 183 CA 2014).   However, a proxy has no right to chair the meeting.  

12. Is notice required for calling an Extraordinary General Meeting (EGM)?

Yes. 14 days notice is normally required for the calling of an EGM of a public company, and 7 days for a private company.

In general, companies hold EGMs when matters of some urgency or importance require consideration by the members. Directors of a company may convene EGMs whenever they consider it appropriate.  A member or members of a company holding at least 50% of the paid up share capital of the company may also convene an EGM.

13. Is there a requirement to hold directors' meetings?

There is no statutory requirement to hold directors meetings. However, ODCE would see it as a basic requirement that directors should meet regularly to discuss issues of relevance and make decisions. The company’s Constitution (Articles of Association) will usually contain certain basic rules governing directors’ meetings, but they generally leave a great deal of freedom to the directors to regulate their meetings as they think fit.

14. Who can attend board meetings?

Section 160 of the Companies Act 2014 states - The directors of a company may meet together for the dispatch of business,  adjourn and otherwise regulate their meetings as they think fit.

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Office of the Director of Corporate Enforcement
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Telephone: +353 1 858 5800
Email: info@odce.ie