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COVID-19 – Virtual AGMs and Owners’ Management Companies

26 August 2020

The introduction of COVID-19 public health guidelines on travel and gatherings have prompted the Government to temporarily amend company law provisions which regulate the convening and holding of general meetings. The Companies (Miscellaneous Provisions) Covid-19) Act 2020 (the “Act”) was commenced on 21 August 2020 and, among other things, seeks to alleviate some of the practical difficulties that companies have encountered in attempting to fulfil their obligations to convene and hold general meetings during the COVID-19 pandemic.

These changes are effective up to 31 December 2020 (the “Interim Period”). The Interim Period may be extended at the request of the Minister for Business, Enterprise and Innovation should it be deemed necessary to do so in the public interest.

Virtual general meetings

Although board meetings of an Irish company may be held remotely, the Act is the first time that a provision has been made under Irish law allowing for wholly virtual[1] “general meetings”[2]. Under the Companies Act 2014, general meetings have to be held in at least one physical place, although it is possible for members to join meetings by electronic means. Meetings held this way are known as hybrid meetings.

The Act legislates for wholly or partly virtual general meetings “as long as all attendees have a reasonable opportunity to participate in the meeting…”. The Act clarifies that the technology used must enable the attendee to hear what is said, to speak and to submit questions at the general meeting to the extent they are entitled to do so under the company’s constitution.

The Act also provides that votes may be cast by members through electronic means provided that the members entitled to vote can be identified by the chair. Even if a company’s constitution provides otherwise, under the Act, each member and proxy who participates in a virtual general meeting will be counted in the quorum.

While careful thought will need to be given to the technology employed, and meetings will have to be carefully managed to ensure that members are able to participate, the provisions of the Act will be of great assistance to any company which has struggled to hold a general meeting during the COVID-19 restrictions.

Rescheduling meetings

The Act helpfully allows directors during the Interim Period to amend any notice already served for an AGM, by giving further prior notice to members, to allow for the meeting to be held virtually under the Act if this is necessary to comply with public health guidelines or restrictions.

Extension of AGM date

Under the Companies Act 2014, an Irish company is required to hold an AGM within 15 months of its last AGM. This requirement can be dispensed with if the company is a single member company or, subject to its constitution, if its shareholders pass a unanimous written resolution permitting the company to do so – options which are rarely open to an OMC.  Under the Act, a company may now postpone its AGM up to 31 December 2020 irrespective of the deadline that would ordinarily apply.

Conclusion

The Act will be of great assistance to OMCs and their members as it will allow them to hold safe meetings at which the unit owners can be kept informed on the financial position of their OMC and at which service charge budgets and sinking fund contributions for 2021 can be considered. However, OMCs will need to ensure that appropriate technology platforms are used and meetings are carefully managed to ensure that members are able to fully participate.

If you have any questions regarding the changes introduced by the Act, contact a member of our Corporate or Corporate Governance & Compliance teams.


The content of this article is provided for information purposes only and does not constitute legal or other advice.


[1] A fully virtual meeting is one with no physical location that is held wholly by electronic means such as by video call.

[2] Under the Act general meetings includes AGMs, EGMs, meetings of classes of shareholders and scheme of arrangement meetings

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