Government Reinstates Measures Allowing for Virtual Meetings and Electronic Document Execution
In light of the recent tightening of COVID-19 restrictions felt nationwide, the Government has reinstated temporary measures that will allow companies to use technology to meet the regulatory requirements necessary to validly execute documents.
The Treasury Laws Amendment (2021 Measures No. 1) Bill was first introduced on 17 February 2021 with the intention of passing in advance of the 21 March expiry. However, the Bill failed to pass and was scheduled to be heard in the Senate in August 2021, resulting in no interim relief. The Bill has now passed on 10 August 2021.
Schedule 1 allows companies to execute documents, hold meetings, provide notices relating to meetings and keep minutes using electronic means or other alternative technologies. As per President of the Law Council Dr Jacoba Brash QC:
“with the AGM season upon us, these measures will allow companies to comply with their reporting obligations without having to grapple with the logistics of hosting large in-person gatherings in the context of social distancing and lockdowns.”
Importantly, the amendments in Schedule 1 of the Bill are intended to remain in force only until 16 September 2021. By that time, the Government intends to have permanent reforms in place.
The Bill does not contain any transitional or retrospective provision for the interim period whilst the Bill was being read. Therefore, the validity of any documents executed electronically between 21 March 2021 and 13 August 2021 will be determined under the pre-COVID application of section 127 of the Corporations Act.
Tim Lynch or Kirsti Makinen can assist with any commercial enquiries.