ASIC issues updated guidance on virtual meetings for registered schemes
The Australian Securities and Investments Commission (ASIC) recently provided updated guidance on virtual meetings for listed and unlisted registered schemes. The updated guidance follows the release of the Government response to the Final Report from the Statutory Review of the Meetings and Documents Amendments Panel (Panel).
Need to know
- Virtual-only meetings can only be held if expressly required or permitted by a registered scheme’s constitution.
- The Corporations Act 2001 (Act) permits hybridmeetings to be held even if no express provision is contained in a registered scheme’s constitution.
- Registered scheme members attending virtual-only and hybrid meetings must be able to exercise any rights they have to ask questions or make comments orally or in writing.
Background
The Government response follows a review by the Panel of the changes that were made to the Act during the COVID-19 pandemic to, among other things, facilitate the electronic distribution of meeting related documents for registered schemes and holding hybrid and virtual-only meetings of registered scheme members.
ASIC's updated guidance
ASIC's updated guidance reflects its expectation that registered scheme members should have equivalent opportunities to participate in meetings, regardless of whether meetings are held using virtual technology or occur in-person. In its updated guidance, ASIC confirms:
- meetings using virtual technology must be interactive and provide members the ability to exercise any rights they have orally and in writing. This includes allowing for live Q&A, real-time polling and voting;
- webcasts alone without interactive features will not meet the requirements for virtual-only meetings;
- a phone line is not required for virtual-only or hybrid meetings where the virtual technology meets the broader requirements for virtual meetings.
The updated guidance also reiterates that where a registered scheme’s constitution is amended to facilitate virtual-only meetings, a copy of the modified or replacement constitution must be lodged with ASIC along with ASIC Form 5101. The modified or replacement constitution cannot take effect until a copy has been lodged with ASIC.
What's next?
The Panel made 11 recommendations to the Government, all of which the Government agreed to, or agreed to in principle. This included a recommendation that unlisted registered schemes should be permitted to determine the appropriate meeting format without a constitutional permission before a wholly virtual meeting may be held.
This would be a welcome change for operators of unlisted registered schemes whose constitutions do not contain authority to operate virtual-only meetings. We wait to see if any changes are made to the Act to facilitate this recommendation.
Our HW Funds team can assist with preparing registered scheme meeting documents and/or holding virtual or hybrid registered scheme meetings. For tailored advice or to discuss how these changes may impact you, please contact our team.
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