Corporate Insolvency and Governance Act 2020
The Corporate Insolvency and Governance Act 2020 (the “Act”) came into force on 26 June 2020, to provide companies with greater flexibility needed as a consequence of the impact of the coronavirus crisis.
Whilst the legislation includes measures related to the insolvency regime some of which are discussed in a related blog, there are also temporary changes to the procedures for holding annual general meetings, along with revised filing deadlines for submission of information to Companies House which are important to note.
Public companies are required to hold their annual general meeting within six months of their accounting period end date, and to file their statutory accounts with Companies House within the same timeframe. Whilst the majority of private companies no longer have to hold an annual general meeting, there are a number who continue to have such a requirement pursuant to provisions in their articles of association. The Act seeks to relax these requirements to provide greater flexibility to companies in light of challenges imposed by social distancing requirements and the limitation of larger gatherings.
The changes to AGMs and other general meetings of shareholders apply retrospectively from 26 March 2020 until 30 September 2020 (the “Relevant Period”), although the Secretary of State has accommodated an ability to change this period, either by shortening or extending it as far as 5 April 2021.
During the Relevant Period, the following changes will apply. These regulations have been designed to supersede any provisions of a company's Articles which might be to the contrary of the guidance:
- A company which would normally be required to hold its AGM during the Relevant Period will now be entitled to hold the AGM at any time before the end of the Relevant Period, meaning meetings will need to be held before 30 September 2020. If the AGM has already been convened it cannot be postponed unless provision exists in the articles to do so;
- There is greater flexibility around the proposed location of the AGM, as this need not be held at any particular place (such as those noted in the company’s articles, for example) for the duration of the Relevant Period;
- AGMs may be held by electronic or other means, and votes may be cast in a similar fashion;
- The participants of an AGM may be located in different locations without invalidating the quorum in attendance and therefore the validity of any decisions made at the meeting;
- Shareholders will not have the right to:
- attend an AGM in person;
- participate in the meeting other than by voting; or
- to vote by any particular means.
Companies House filing deadlines
The Act gives the Secretary of State the power to extend deadlines for certain filings made to Companies House and in order to provide companies and LLPs with additional flexibility, the following amendments have been brought into force:
Companies and LLPs will be granted an automatic three-month extension to file their accounts if their filing deadline falls between 27 June 2020 and 5 April 2021. The three-month extension will start from the company/LLP’s original filing deadline, rather than any extension already granted. Companies and LLPs can view their new filing deadline using the Companies House service website.
- Confirmation statement
Normally, companies and LLPs are given 14 days from the end of their review period in which to file their confirmation statement. Under the new Regulations, this is automatically extended to 42 days.
- Event-driven filings
The period for delivery of forms notifying Companies House of changes such as to director/LLP member details, PSC information and registered office address will increase to 42 days. The period allowed to deliver the particulars of a charge will increase to 31 days for charges created on or after 6 June 2020.
We hope this provides you with a helpful summary of some of the changes brought about by the Corporate Insolvency & Governance Act 2020. This guide is not legal advice, but should you require any further advice or assistance, please do not hesitate to contact us.
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