Recent changes to the Corporations Act for electronic meetings, notices, minute books and e-signing due to the Covid-19 pandemic
November 2021 | News | Tina Lee and Anne Robinson
The Commonwealth Parliament has introduced new temporary changes to the Corporations Act 2001 (Cth) (Corporations Act) that will assist companies during the Covid-19 pandemic to conduct meetings of directors and members electronically and execute documents electronically. These amendments to the Corporations Act – which were introduced by schedule 1 of the Treasury Laws Amendment (2021 Measures No. 1) Act 2021 (Cth) (Amending Act) – are initially proposed to be effective until 31 March 2022.
Key changes relevant to charities and not-for-profits that are companies
Upon being given Royal Assent on 13 August 2021, the Amending Act amended the Corporations Act to allow (temporarily, until 31 March 2022):
- fully virtual meetings of directors of companies and fully virtual meetings of members of companies provided persons entitled to attend have a reasonable opportunity to participate;
- notices of meetings to and other documents to be sent to members of companies via electronic means or by sending an electronic address at which the notice materials can be downloaded;
- directors and officers of companies to sign documents or affix documents with a common seal electronically; and
- allow recording and keeping of minute books to be carried out electronically.
Further consequential amendments to the Corporations Act were made by the Amending Act to facilitate the substantive amendments to the Corporations Act set out above.
The Amending Act also permanently introduces a new Part 2G.6 of the Corporations Act, which will allow ASIC to make determinations allowing companies to hold delayed AGMs and hold virtual meetings in exceptional circumstances. ASIC is yet to indicate whether particular entities or particular classes of entities may be affected by any future determinations to be made under these provisions.
Implications of the Amending Act’s amendments for your company
The Amending Act provides that many of its temporary amendments to operative provisions of the Corporations Act will only have effect until 31 March 2022. It would be wise to amend your company’s constitution to:
- allow for flexibility in your company’s governing rules to ensure you can take advantage of the Amending Act’s changes to the Corporations Act in the short term; and
- maintain this flexibility in the event that the Commonwealth Parliament chooses to extend the operation of these changes beyond 31 March 2022 (if the Covid-19 pandemic continues, or if the Commonwealth Parliament chooses to implement the provisions permanently).
Please contact Tina Lee or Anne Robinson if you have any queries or would like to discuss the effect of the Amending Act’s changes on your company’s constitution.