Electronic or written AGM temporarily permitted for all legal entities
From a company law perspective, Article 6a of COVID 19 Regulation 2 (amendment of 16.03.2020) is noteworthy: by emergency law, the admissibility of "meetings" held electronically or in writing, or meetings by proxy, is decreed.
Although the article, apparently inserted at the last minute, only speaks of "societies", this is probably a result of haste. If these facilitations are permissible for meetings of 'societies', which are generally regulated in detail by law, then they must also be permissible for the less regulated associations, cooperatives and foundations. In legal terms, this is called argumentation, which derives from the principle 'argumentum a majore ad minus'. The aim of this article of the ordinance is clear: to enable the statutory life of legal persons by means of 'remote channels', this for the purpose of avoiding physical meetings, but at the same time to maintain as far as possible the 'normal operation' of society and the economy in this traditional season of general meetings.
From a legal point of view, there is nothing to be said against applying Art. 6a of COVID-19 Regulation 2/16.03.2020 to all legal entities and partnerships, where up to now the presence hearing has been a traditional requirement.
What needs to be considered so that this welcome modernisation of the right of assembly does not lead to undesirable results and end up in court proceedings:
The notice periods of Art. 6 para. 2 COVID-19 Regulation 2/16.03.2020 shall be complied with.
The means used should serve to enable participation, not to select and manipulate the result. They should therefore correspond to the reasonably expected possibilities of the entitled persons: e.g. no electronic communication platforms may be used if it is known and obvious that the entitled persons are hardly IT-savvy.
Whenever possible, alternative options should be used in parallel. For example, issuing a power of attorney to a proxy (with the possibility of instructions), participation via video conference and via telephone conference at the same time.
The quorums are to be ensured: it is to be documented in the minutes who participated in which way and if (and when) entitled persons have left the meeting. To ensure that the meeting is conducted properly, the board of directors/executive committee must make use of technical support from third parties.
The beneficiaries must have the documents required for decision-making in advance.
The modalities for holding the meeting must be decided in advance in detail in a formal (circular) resolution of the BoD/Board of Directors, and the modalities for holding the meeting (as well as the invitation thereto) that deviate from the Articles of Association must be recorded in the minutes in detail and with reference to COVID-19 Regulation 2/16.03.2020.
The implementation options that deviate from the statutes should only be used sparingly and with the aim of maintaining minimum operations. The participation rights of the entitled persons must not be unreasonably curtailed: apart from the certification requirements, which may still be necessary, no surprising, far-reaching or otherwise unmanageable agenda items may be put to the vote. In case of doubt, only those items on the agenda of an ordinary general meeting that are really absolutely necessary may be put to the vote in this way.
In our opinion, it would be too far-fetched to directly put amendments to the statutes to a vote at such meetings, which include a permanent introduction of these invitation and resolution modalities. The COVID-19 regulation 2/16.03.2020 is 'emergency law' and is intended to allow continued operation in an exceptional situation.
"Follow the proven principle of "no surprises" and create transparency."
Our specialists are at the disposal of all responsible persons to advise you in individual cases and to support you in the planning and implementation of meetings.
Please feel free to contact Balthasar Wicki if you have any questions.