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The federal government is pushing forward with its pledge to modernise aspects of the Corporations Act 2001 after temporary measures required to keep businesses going through the pandemic proved to be both pragmatic and popular.
The Corporations Amendment (Meetings and Documents) Bill 2021, which was introduced to parliament on 20 October, will permanently allow companies to use technology to meet certain regulatory requirements, such as when signing or requesting a signature on documents.
The proposed measures make it permissible for companies to hold virtual meetings, distribute meeting‑related materials, and validly execute documents via digital means. The bill closely follows the temporary powers that were first implemented in May 2020.
When the expiry of these provisions in March 2021 prompted widespread calls for their reinstatement, the government looked not only to extend the measures but make them a permanent fixture of the law.
The current temporary powers, which came back into effect on 10 August 2021, extend through 31 March 2022, by which time the government hopes to have made them permanent.
The new permanent reforms aim to:
- Ensure that meetings can be held physically, as a hybrid or, if expressly permitted by the entity’s constitution, virtually, provided that members, as a whole, are given reasonable opportunity to participate in the meeting.
- Ensure that companies and registered schemes can meet their obligations to send documents in hardcopy or softcopy and give members the flexibility to receive documents in their preferred format.
- Allow documents including deeds to be validly executed in technology-neutral and flexible manners, including by company agents.
The government estimates that around one million operating businesses stand to gain from the measures being made permanent and that they will deliver an average deregulatory savings of $450 million per year over the next 10 years.
A review after two years of the measures being in effect is proposed to ensure they are functioning as intended.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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