Zooming into Compliance: ASIC's Latest Guidance on Virtual Meetings — Brown Wright Stein Lawyers | Sydney Lawyers - Tax Specialist Lawyers, Corporate & Commercial Lawyers..

ASIC has released updated guidance clarifying how companies and registered schemes can conduct virtual and hybrid shareholder meetings, reinforcing that shareholders attending meetings virtually must have an equal opportunity to participate.

The guidance, building on reforms to the Corporations Act 2001 (the Act) enacted in 2022 (2022 Amendments), emphasises that:

Entities must ensure virtual attendees can ask questions and make comments live, with procedures in place for real-time interaction. For example, it is not sufficient to simply facilitate a live webcast of a shareholder meeting such as an AGM where attendees can only view the meeting without any ability to interact by asking questions or making comments.
A telephone line option is not required for a shareholder meeting if a webcast allows for real-time engagement. However, a combination of technologies may be used (for example, providing shareholders with a choice of dialling in by phone or using an online chat function to ask questions or make comments). The virtual meeting format used must allow attendees to exercise any rights orally and in writing.

It is important to remember that whilst the Act allows companies to hold hybrid shareholder meetings, it only permits wholly virtual shareholder meetings to be held if expressly permitted by the company's constitution.

The difference between a hybrid meeting and a virtual meeting is that a hybrid meeting offers both in-person and remote participation, while a virtual meeting is entirely online.

Companies wishing to hold wholly virtual shareholder meetings should review their constitutions to ensure virtual meetings are permitted. Boards are also encouraged to familiarise themselves with ASIC's updated guidance to maintain compliance and ensure effective shareholder participation.

Further changes to the law regarding holding meetings electronically are expected after the Federal Government released its response to a recently published independent report on the 2022 Amendments.

If you, or one of your clients, would like help with updating your constitution or require advice on holding shareholder meetings, please contact us.

The material in this article was correct at the time of publication and has been prepared for information purposes only. It should not be taken to be specific advice or be used in decision-making. All readers are advised to undertake their own research or to seek professional advice to keep abreast of any reforms and developments in the law. Brown Wright Stein Lawyers excludes all liability relating to relying on the information and ideas contained in this article.