On April 3, we informed you on an emergency law that makes it possible to have physical consultation and decision-making procedures of legal persons (NV, BV, foundation, association, cooperative) take place temporarily electronically. On 8 April, a bill has been submitted to the House of Representatives. Parliamentary examination of the bill is likely to take place next week.
Below we discuss the main proposed changes. If we refer to members or shareholders, this also includes other persons entitled to attend the meeting (such as depository receipt holders and pledgees with meeting rights).
2. General meetings
The management board may determine that instead of a physical meeting, a general meeting is held that can only be followed by an electronic means of communication. It is not required that the articles of association provide for this. However, the following conditions must be met:
The convening notice must state that the general meeting will be held in electronic form. If the convening notice has already been sent, but does not provide for the possibility of an electronic meeting, the management board may change the method of meeting or the place of the meeting no later than 48 hours before the time of the general meeting. Members or shareholders will then have the opportunity to submit questions up to 36 hours prior to the meeting.
If the electronic connection does not function properly during the meeting or if a member or shareholder cannot participate optimally in the electronic meeting, this has no consequences for the legal validity of the decision-making.
3. Meetings of the management board and the supervisory board
If the articles of association would include rules for convening or holding meetings of the management board and the supervisory board, these statutory provisions may be deviated from, for example by organizing meetings by electronic means. In that case, the approval of all managing directors, respectively supervisory directors will be required.
Statutory provisions that subject certain decisions of the management board to the approval of the supervisory board are temporarily declared inapplicable.
4. Postponement of drafting annual accounts
The management board can postpone the term for holding a general meeting and the term for drawing up the annual accounts. This applies only to general meetings which need to adopt the annual accounts for the financial year 2019. The term for holding a general meeting can be extended by a maximum of four months. The management board can extend the preparation of the annual accounts by a maximum of four months (in the case of a cooperative) or five months (in the case of an NV or BV). The general meeting cannot extend if the management board has already made use of this option.
5. Limitation of presumption of evidence in case of improper performance of duties
Failure to publish the annual accounts related to the most recent closed financial year (on time) does not count as manifestly improper performance of duties in the event of the bankruptcy of the NV or BV, if the board can demonstrate that the omission of the publication obligation is due to the consequences of the corona virus. The limitation of the presumption of evidence does not apply to the accounting obligation.
6. Validity period
The emergency law will expire on September 1, 2020, but there is a possibility to extend this period by two months each time. The regulation regarding the limitation of the presumption of evidence in the event of improper performance of duties will expire on 1 September 2023.
We will keep you informed of the further progress of the legislative process.
As of 13 September, BUREN welcomes the highly experienced candidate-notary
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