Modified provisions for virtual business meetings you need to be aware of
Businesses moving towards online operations (temporarily or permanently) need to be aware of the Government’s modified provisions concerning virtual meetings and the electronic signing of company documents. These modified provisions in the Corporations Act 2001 (Cth) became active on 5 May 2020 and will automatically be repealed on 5 September 2020.
The new temporary provisions outline how a virtual company meeting should be held and procedures they must follow. Under the Determination, meetings may be held using one or more technologies so that members do not have to be at the same physical location to satisfy business requirements such as a quorum.
Additionally, members must be able to speak at the virtual meeting and voting must be done through an online poll rather than a usual show of hands. Proxies may participate in a meeting in the event that businesses are unsure of the necessary virtual procedures.
Notice of meetings
Notices for meetings, along with any material related to the meeting, must be issued to participating members before a virtual meeting is held. Such notices can be sent digitally through email, or posted on an online location where the notice and other material may be viewed by participating members. Under the new provisions, the notice must also include how involved members can speak and vote on polls during the meeting.
Electronic signing of company documents
It is understandably difficult to sign and execute documents online. However, the new provisions allow for electronic signing in place of signing a physical copy if necessary, as long as the electronic signature reliably identifies the person and indicates the person’s intention about the contents of the document. Physical signings with electronic communication (such as fax) are also permitted.
Although there are many virtual meeting and electronic signing technologies available to businesses, not all are easy to operate and free. Consider investing into a paid service if you are considering moving more of your business operations online and test a number of platforms first before committing to one in particular.