Our Q&A summarising the main provisions of the ordinance adapting the rules for the assembly and deliberation of general meetings and governing bodies of legal entities and private legal entities without a legal personality due to the Covid-19 epidemic, published in the Official Journal on 26 March 2020.
What is the objective of the ordinance?
The purpose of Ordinance no. 2020-321 of 25 March 2020 is to adapt the rules for convening, providing information, assembly and deliberation of meetings, governing bodies, supervisory bodies and management bodies of private legal entities to enable them to continue to carry out their responsibilities during the lockdown imposed to combat the Covid-19 epidemic.
Which entities are affected by the adaptation measures contained in the ordinance?
All private legal entities with and without a legal personality are affected. Article 1 of the ordinance explicitly mentions a number of private legal entities although that list is not exhaustive.
Which bodies are concerned?
The measures contained in the ordinance are broadly aimed at general meetings of shareholders, partners, members or delegates but also special meetings and group meetings (e.g. groups of bondholders) as well as all collegial administrative, supervisory and management bodies.
What are the measures adapting the rules for convening meetings and providing information to shareholders of listed companies?
When a listed company is required to convene a shareholders’ meeting by post, the meeting is not deemed to be invalid simply because the notice to attend was not sent by post due to external circumstances beyond the company's control. External circumstances are particularly those in which companies or their service providers have been prevented from accessing their premises or preparing the necessary notices to attend in the context of the Covid-19 epidemic.
Listed companies can also validly respond by email to a request for communication of a document or information to a member of a meeting prior to that meeting being held, subject to certain conditions.
What adaptation measures are taken by the ordinance concerning the rules for participation in meetings and their deliberation?
If the meeting was convened, on the date of the notice to attend, in a place where public gatherings are restricted or prohibited on health grounds, the competent body (or legal representative by delegation) may decide that it should be held without the members and other persons entitled to attend (e.g. statutory auditors, employee representative) being present physically or by telephone or video-conference.
How should a meeting be held?
The ordinance stipulates that any meeting may be held:
either according to the other methods stipulated by law: as the case may be, private deed recording the shareholders’ unanimous decisions, postal voting, etc.;
- or by telephone or video conference allowing identification of the participants, by way of exception to the law and any contrary clause in the articles of association or any issue agreement;
- or by written consultation when allowed for by law even if not stipulated in or contrary to any clause in the articles of association or an issue agreement.
What are the relevant decisions?
These measures concern any decisions falling within the remit of ordinary and extraordinary meetings, special meetings and group meetings.
What technical conditions need to be respected?
The technology used must as a minimum transmit participants’ voices and meet technical conditions allowing the continuous and simultaneous retransmission of the deliberations.
It should be noted that, by way of exception, the nature of the acceptable technology and conditions for use of the technology required for meetings of companies incorporated as société anonyme subject to the provisions of paragraph II of Article L.225-107 of the French Commercial Code and meetings of bondholders subject to the provisions of Article L.228-61 of said code are those determined by the Council of State decree referred to in those articles.
What measures are applicable if notices to attend the meeting have already been sent?
If notices to attend the meeting have already been sent before the competent body decides to use one of the adaptation measures offered by the ordinance or an alternative method to hold the meeting, it must inform participants of that decision, either by means of an official communiqué for listed companies, or by any means effectively informing members in unlisted companies.
What adaptation measures are taken by the ordinance concerning the rules for deliberation by governing bodies, supervisory bodies and management bodies?
Collegial administrative, supervisory or management bodies may also be held:
- either by telephone or video conference allowing their identification and guaranteeing their effective participation, even when not stipulated in or contrary to the articles of association or internal rules;
- or by written consultation of their members under conditions ensuring the collegial nature of the deliberation, even when not stipulated in or contrary to the articles of association;
These options are available regardless of the nature of the decision, therefore allowing board meetings convened to examine and close the annual accounts to be held by conference call, video-conference or written consultation.
What time limits apply?
The ordinance is applicable to meetings of collegial administrative, supervisory and management bodies held from 12 March 2020 until 31 July 2020, unless this period is extended to a date fixed by decree and no later than 30 November 2020.
The ordinance stipulates that a decree may be required to specify, as far as necessary, the application conditions of the ordinance. We will be sure to keep you informed if that is the case.
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