Telematic holding of General Meetings of Shareholders or meetings of the Board of Directors

Telematic holding of General Meetings of Shareholders or meetings of the Board of Directors

As of January 1, 2022, those companies that wish to continue to hold their general meetings and meetings of their administrative body telematically, must expressly include this possibility in their Articles of Association.

As a consequence of the crisis caused by the pandemic and with the approval of different legal measures to reduce the negative effects caused by the health situation, until December 31, 2021 it was possible to hold general meetings and meetings of the administrative body telematically, although this possibility was not expressly included in the Articles of Association. 

Below, we share the details to keep in mind in order to be able to continue holding meetings remotely. 

The telematic call of General Meetings and meetings of the administrative body 

Derived from the health crisis of 2020, and as a consequence of the approval of the different legislative measures to deal with the consequences of the pandemic, companies began to be allowed, without having to previously modify their bylaws, to use telematic means to make the calls for the general meeting of the shareholder, in addition to holding them remotely. 

Following the provision of Article 173.2 of the Capital Companies Act, the possibility is enabled to make the calls by “any individual and written means, which ensures the reception of the announcement by all the shareholders...”. This provision allows that nowadays it is common practice to call meetings and board meetings by e-mail or other telematic means, so it is important to include this possibility in detail in the bylaws, determining the necessary requirements for the citation to be valid.

Holding the General Meetings exclusively telematically

One of the possibilities is that it is decided to convene the General Meeting exclusively by telematic means, i.e., all the attendees must necessarily connect remotely. This possibility has been included in Article 182.bis of the Capital Companies Law. 

Although Royal Legislative Decree 8/2020, Royal Legislative Decree 11/2020, Royal Legislative Decree 21/2020 and the fourth final provision number three of Law 2/2021, of March 29, on urgent measures of prevention, containment and coordination to deal with the health crisis caused by COVID-19 approved the possibility of holding telematic meetings and meetings without having to expressly include this possibility in their bylaws, the current wording makes it mandatory to expressly include this possibility in the Articles of Association. 

Among the various considerations that must be met in order to be able to hold exclusively telematic meetings is the necessary identification of the shareholders and representatives and confirmation of their legitimacy to participate. In addition, the administrative body must use the necessary measures to guarantee the proper functioning of the meeting, i.e., use the different technological and technical means that allow the shareholders to participate adequately by exercising their rights to speak, information, proposal and vote in real time.

The notice of the meeting must expressly indicate the means and manner in which the meeting is to be held.  

For the purposes of exclusively telematic meetings, the meeting shall be deemed to be held at the registered office of the company. 

Furthermore, despite the fact that the meeting is held telematically, the general rules for face-to-face meetings shall apply, and some aspects may be adapted to the implications arising from the use of telematic means. 

In order to approve the amendment of the bylaws including the possibility of holding General Meetings exclusively by telematic means, the affirmative vote of two thirds of the shareholders in attendance will be required. 

Attendance at the General Shareholders’ Meetings telematically.

In addition to the above possibility, given the pandemic context and being possible that only some or some of the shareholders cannot attend the meetings in person, the last amendment to the Capital Companies Act also introduced a change in Article 182. Specifically, it added the possibility that, if contemplated in the Bylaws, it is possible for a shareholder or some of them to attend the meeting remotely. 

Specifically, Royal Legislative Decree 8/2020, Royal Legislative Decree 11/2020, Royal Legislative Decree 21/2020 and the fourth final provision number three of Law 2/2021, of March 29, on urgent measures of prevention, containment and coordination to deal with the health crisis caused by COVID-19 approved the possibility of holding the meetings and telematic meetings without having to expressly include this possibility in their bylaws. 

This legal provision seeks to offer a solution for specific cases in which, for whatever reason, one of the shareholders or members of the board of directors cannot attend the meeting in person. 

In any case, it will be essential that the identity of the shareholder or representative is guaranteed, and that the notice of the general meeting establishes the means to be able to attend properly by exercising the shareholder’s rights.   

The holding of the meetings of the company’s Administrative Body.

Although the Capital Companies Law did not change with its recent amendment the provisions regarding the meetings of the administrative body, it has been a common practice to include in the Articles of Association provisions that allow the holding of the meetings telematically.

Therefore, it will be important to bear in mind the above considerations in order to ensure the proper convening and holding of board meetings.

LETSLAW

In Letslaw we are specialists in advising startups and companies in the incorporation and subsequent amendments of the bylaws. Our professionals will be able to help you include these provisions in order to be able to hold meetings remotely.