The Belgian Code on Companies and Associations (BCCA), which was adopted roughly a year before the start of the global pandemic, has modernised the governance and decision-making rules in Belgium but the pandemic has shown that there is still room for additional flexibility.
Over the past year, temporary measures have therefore allowed companies and associations to cope with the corona-related restrictions.
Now, the Belgian legislature has codified the “new normal” in the BCCA in a more permanent manner.
Remote general meetings of shareholders and bondholders
Before the new Act’s adoption, the option to organise a general meeting of shareholders or bondholders through the relevant securities holders’ remote participation required a provision to that effect in the company’s articles of association.
The new Act has done away with this requirement and instead entrusts the choice about organising such meetings remotely to the company’s management body.
Convening a remote general meeting: mandatory particulars in the convocation notice
The convocation notice for the general meeting must contain a clear and accurate description of the procedures for the remote participation. If the company or association has an official company website (within the meaning of Article 2:31 of the BCCA), then the remote participation procedures must be accessible on that website for the people who are entitled to participate in the general meeting. For listed companies, this information must be accessible on the company website for everyone.
Holding a remote general meeting: choosing the right means of communication
The management body has to choose the means of communication to be used for the remote participation.
The means of communication must satisfy certain minimum conditions. First, the communication tool must enable the company to verify the securities holder’s capacity and identity. Second, it must enable the securities holders to take note of the discussions directly, simultaneously and without interruption and, specifically for the shareholders, allow them to exercise their voting rights for each decision topic.
The company can impose additional conditions for the sole purpose of ensuring the security of the electronic means of communication.
It will no longer be required to further specify the minimum conditions for the remote participation in the articles of association or in an internal regulation established under the articles of association.
The communication tool must also enable the securities holders to participate in the deliberations and to ask questions. Until 30 June 2021, the management body may justify why the company does not have such a communication tool at its disposal in the convocation notice (comply or explain). As from 1 July 2021, the right to justify such non-compliance will be dropped and the chosen communication tool will have to enable the participants to take part in the deliberations and to ask questions.
The communication tool does not necessarily have to be sophisticated. The management body can choose a suitable system taking into account the company’s specific circumstances (for example, the number of shareholders). A video or telephone conferencing system such as Teams or Zoom, or for companies with a very limited number of shareholders who know each other, even a simple conference call, could be sufficient.
The rule is abolished that the directors and the statutory auditor (if there is one) are not allowed to attend the meeting electronically. From now on, only the members of the bureau (i.e. the chairman, the secretary and the vote-counters) are not allowed to attend the general meetings electronically – they have to be present at the location of the meeting indicated in the convocation notice.
The meeting minutes must state any technical issues or incidents that have impeded or interrupted the electronic participation or voting.
A non-profit associations’ toolbox to be completed with remote general meetings, advance electronic voting and unanimous written decision-making
The Act also introduces the option to organise general meetings remotely for the non-profit associations (VZW/ASBL) and international non-profit associations (IVZW/AISBL). Here too, the decision to organise a general members’ meeting remotely is left to the association’s management body. As is the case for limited liability companies, it also becomes possible for an association’s members to vote electronically in advance of the general meeting, subject to this procedure being foreseen in the association’s articles of association.
For (international) non-profit associations, members will also be allowed to follow a fully written decision-making process for all decisions except for amendments to the articles of association. In other words, the rules on written decision-making for limited liability companies are copied for (international) non-profit associations.
Please do not hesitate to contact us if you would like to know more about organising shareholder or board meetings safely and efficiently at your company or association.