Legal & Tax Alerts

New rules for holding corporate statutory bodies meetings

The Romanian Government has adopted the Emergency Ordinance no. 62/2020 (the ”Emergency Ordinance”) which entered into force on 8 May 2020. It provides special measures in the context of COVID-19 pandemic regarding the manner of convening and holding General Meetings of Shareholders (“GMS“), as well as the company’s managerial, supervisory bodies and/or directorate’s meetings in accordance with the Companies’ Law no. 31/1990.

The applicability of the Emergency Ordinance’s provisions

The measures provided within the Emergency Ordinance are applicable when the GMS:

» was convened before the entry into force of the Emergency Ordinance[1], but for which holding of the GMS is set for a subsequent date to the establishment of the state of emergency[2];

» was convened during the state of emergency, but the GMS will take place after the end of the state of emergency;

» will be convened and held in the first 2 months after the end of the state of emergency.

At the same time, the Emergency Ordinance provides the extension until 31 July 2020 of the term provided by the Companies Law no. 31/1990 on the obligation to hold the GMS at least once a year, within 5 months from the end of the financial year.

In addition, during the state of emergency and within 30 days as of the end of the state of emergency, the participation within the company’s managerial, supervisory bodies and/or directorate’s meetings can be performed through means of remote direct communication, regardless of the subject of the meeting. In this regard, the statutory body which has the right to convene the meeting will choose the manner of attending the meeting and exercising the right to vote.

Convening the GMS

During the period established through the Emergency Ordinance, the GMS may be convened by the statutory bodies of the company which have this right, regardless if this is provided or not within the company’s articles of incorporation:

» by publishing the convening notice in the Official Gazette of Romania, part IV, or

» by any means of remote communication which ensure the transmission of the convening notice’s text (g. by registered letter, by courier, by letter sent electronically to which extended electronic signature is applied[3], by telefax), provided that each shareholder has submitted the appropriate contact details for receiving the correspondence.

The convening notice will also have to be sent by email, if the addresses of the shareholders are known by the company. At the same time, the convening notice together with the information and documents regarding the items on the agenda[4] will be published on the company’s website, if such a page exists. Otherwise, this information and documents will be sent to shareholders by email, and if this last method is not possible – it will be sent via mail or courier.

The requirements for convening the GMS will also apply to the communication of the agenda completed with the proposals submitted by shareholders, by any means of remote communication that ensures the transmission of the text, to the address provided in the convening notice.

Holding the GMS

During the period established through the Emergency Ordinance, the GMS may also be held by correspondence or by electronic means of remote direct communication (e.g. teleconference or videoconference) which enable identifying the participants, continuous and real-time transmission, recording and archiving of the discussions, as well as the exercise and verification of the granted votes, in accordance with the provisions of the convening notice and without taking into account the provisions of the company’s articles of incorporation.

If the GMS is exclusively held by correspondence, the rules involving the physical presence of shareholders provided by the Companies’ Law no. 31/1990 are not applicable and, therefore, the presence of the directors, members of the board of directors, members of the directorate, members of the supervisory board or directors within that GMS is not mandatory.

The communication of the votes expressed within the GMS personally or through a representative will be made in accordance with the provisions of the convening notice, namely through: (i) registered letter; (ii) mail or courier services, or (iii) by letter sent electronically to which extended electronic signature is applied, in order for the vote to be received by the company until the date of the meeting.

If there are items on the agenda that require a secret vote, the statutory body convening the GMS will ensure that the shareholders’ votes are expressed by means that allow their disclosure only to those responsible for counting and validating the votes in the GMS.

Following the GMS, the chairman of the board of directors, the director with powers of representation or the chairman of the directorate or, as the case may be, the empowered person, shall draw up and sign with handwritten or extended electronic signature the GMS decision which will include all the items on the agenda approved within that GMS.

 

[1] In this case, the statutory body which has the right to convene the GMS will have to inform the company’s shareholders on how the meeting will be conducted and on the manner of exercising the right to vote, at least 5 days before the date established for holding the GMS.

[2] As established by the Presidential Decree no. 195/2020 and extended by the Presidential Decree no. 240/2020.

[3] The extended electronic signature will be applied only if the statutory body which has the right to convene the GMS has such signature.

[4] If applicable, the annual financial statements, the annual report of the board of directors/ directorate/ supervisory board, the report of the censors/ financial auditors, the proposal on the distribution of dividends and the situation regarding the dividends partially distributed during the financial year will be published.

 

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