AGMs - CIGA 2020 Temporary Provisions
The Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) Regulations 2020 (“Regulations”) came into force on 29 September 2020. The new Regulations are important as they extend the period in which companies and “other qualifying bodies” can hold meetings under the Corporate Insolvency and Governance Act 2020 (“CIGA 2020”).
The CIGA 2020, which was introduced earlier in the year, brought in measures for corporations to hold meetings and vote in compliance with the Coronavirus social distancing rules.
The CIGA 2020 applies to a general meeting of a company or qualifying body, a meeting of any class of members of a company or a qualifying body and/or a meeting of delegates appointed by members of a company or other qualifying body.
The CIGA 2020 covers corporate bodies that were required by their constitution or legislation to hold their AGM between 26 March 2020 and, originally, 30th September but the Regulations have now extended this period until 30 December 2020.
A number of corporate organisations are covered by the CIGA 2020 including companies, charitable incorporated organisations and registered societies within the meaning of the Cooperative and Community Benefits Societies Act 2014. However, unincorporated charities are not listed as a “qualifying body” and such an organisation would need to refer to Charity Commission guidance.
The corporate organisations will be given until the end of the period to hold the meeting. However, the Regulations may not be used to extend the period for holding an AGM by more than eight months.
Corporate bodies and charities have found it very difficult over the last few months to meet in accordance with their governing documents, constitutions or articles of association. The introduction of the CIGA 2020 meant that meetings did not have to be held in a particular place, allowing for individuals to participate without being in the same location, and votes could be cast by electronic or other means.
Meetings can therefore be held in a way that is compliant with social distancing rules and regulations, despite what is laid out in company legislation or in governing document. Any decisions arising from meetings held under the CIGA 2020 would be lawful.
Posted on: 03/11/2020
This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.
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