President ratifies bill on company extraordinary general meetings
Parliament on Tuesday passed the amendment.
President Mohamed Muizzu on Thursday ratified an amendment to the Companies Act to shorten the notice period for holding general meetings of companies and the existing period for appointment of members to the board of companies.
Parliament on Tuesday passed the amendment.
The purpose of the amendment is to make changes to the procedures required to hold an extraordinary general meeting of a company under the law.
Except for companies with only one member as provided by law, the board of directors of the company shall make arrangements for the holding of an extraordinary general meeting of each company in two cases. These include:
-
In the case of a private company, the request of not less than 10% of the voting members at a general meeting.
-
If it is a public company, at least 10% of the members entitled to vote at a general meeting should request it.
The main amendment is to allow extraordinary general meetings to be held on short notice instead of the current deadlines. They include:
-
As the law currently stands, the board of directors must convene the meeting within 21 days of receipt of the request and the meeting should be held within 3 months of receipt of the request.
-
The amendment proposes that the board of directors should convene the meeting within three days of receipt of the request and the meeting should be held within 10 days of receipt of the request.
-
The law currently requires that if it is a private company, it must send notice at least two weeks before the scheduled date of the extraordinary general meeting; Instead, the amendment shortened the period to seven days.
The next change in the law is to expedite the time for appointment of new managing directors and directors if there are not the required number of directors. They include:
-
Currently, if the registrar is brought to the attention of the absence of directors or the absence of a managing director, they must be appointed within 30 days of the notification.
-
The amendment shortens the period to 10 days.
