Circular on virtual EGMs

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VIRTUAL EGMS

The Ministry of Corporate Affairs (MCA) published its general circular 14/2020 on 8 April 2020 (EGM circular No 1) on extraordinary general meetings (EGMs). It notes that the act does not contain any specific provisions for the conduct of members’ meetings through video conferencing (VC) or other audio-visual means (OAVM). EGM circular No 1 directs companies to take all decisions of urgent nature, which require the approval of members, by way of postal ballot or e-voting as per section 110 and section 108. However, in case of unavoidable circumstances, EGM circular No 1 permits companies to conduct EGMs by way of VC or OAVM.

EGM circular No 1 further specifies the minimum technical criteria that the VC and OAVM infrastructure should adhere to in order for a company to implement the same for the purposes of the meeting. Subsequently, vide general circular No 17, dated 13 April 2020 (EGM circular No 2), the MCA issued clarifications in light of practical difficulties that were left unaddressed by EGM circular No 1.

Significantly, EGM circular No 2 provides relaxations in relation to the manner in which notice of a meeting may be sent out to members, and clarifies the manner in which polls (including those by a show of hands) may be carried on during an EGM conducted via VC or OAVM.

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