Recent updates to legislation, in response to problems caused by lockdowns, have allowed companies to now sign documents and hold meetings using electronic means.
Under the new law, the following applies:
- Company documents can be executed whether with or without a seal by electronic means.
- Directors’ meetings and meetings of members (shareholders) may be held using electronic means provided that the persons entitled to attend the meeting as a whole have a reasonable opportunity to participate.
- If electronic means are used to hold the meeting the notice of the meeting must include sufficient information to allow all attendees to participate and the quorum includes all persons participating virtually.
- Documents relating to a meeting may be given electronically if it is reasonable to expect that the document will be readily accessible so as to be usable for subsequent reference at the time it is given.
- Members have the right to opt-in to receive in hard copy.
- Documents relating to a meeting may be signed electronically by using a method to identify the signatory and indicate the signatory’s intentions.
- The minutes from meetings of members may be taken electronically and the minute book may be provided to shareholders and members and kept electronically.
These have been enacted as changes to the Corporations Act 2001 made by the Treasury Laws Amendment (2021 measures number 1) Act 2021. Last year, they were made as temporary changes through a Covid-19 Protocol.
All of these changes have a sunset date of 16 September 2021, meaning that the changes expire on this date. Although there is an intention by the Government to make these changes relating to digital communications permanent.
Alterations to the legislation allow for the permanent changes to come into place after April 2022.
How Can We Help?
The Snedden Hall & Gallop Commercial Law Team have extensive experience in working with businesses across all levels, and here for any commercial advice and support. Contact them on 02 6285 8000 or by email.