Covid-19 has brought flexible measures for the celebration of GMs for companies, foundations, etc. These measures determine GMs can be hold telematically without the need to attend them physically, shareholders can vote remotely. There is no possibility to agree the dissolution and liquidation of a company during the state of alert. The approval of Annual accounts have also been extended so this means that the GM for approving these does not obligatory have to be convened between 1 April to 31 July

Flexible Measures

Article 40 of Royal Decree 8/2020 has brought some interesting and helpful measures for small and medium companies, foundations, associations, etc to deal with their day a day affairs and to comply with their administrative and governing obligations such as annual accounts fillings, celebration of General Meetings, etc.

The usual period in which annual accounts have to be prepared and formulated, this is normally between 1 January to 31 March (first 3 months after the end of the business year) is suspended until the state of alert is over.

The approval of the annual accounts at the Annual General Meeting will take place within the 3 months period after these are formulated, however this period will not run until the accounts are formulated and state of alert is over. It could happen that annual accounts will be approved in September or October 2020.

Directors who had already convened a GM for the approval of the annual accounts before the state of alert came into force,  and the date of the GM coincides with the state of alert period, can modify such date by communicating this to the shareholders at the company´s web page or at the Official Gazette.

In regards the possibility of celebrating GMs by video conference, the regulation states that during the state of alert, companies will be authorised to hold GMs by electronic means, even for those companies that do not  contemplate such provision in their by-laws. This is of help as there are quite a lot of small and medium companies that have not yet adapted their by-laws to the actual status of development of electronic means.

In case the presence of a notary is requested by a shareholder, the notary can attend the General Meeting telematically and record minutes.

Shareholders´right of separation is suspended until the state of alert is over.

The usual periods for the dissolution of companies have also been suspended, as, in the case a company became in legal cause of dissolution before or after the state of alert came in to force, the legal period to convene the GM to reach the agreement of  the dissolution of the company will also be suspended until state of alert is over.

Lastly, those agreements that affect the Governing Body of the company, foundation or association can be adopted in writing and without celebrating a meeting, when decided by the president and such agreement will need to be approved by at least two of the members of the body.

In Scudamore we can help you to adapt your by-laws in order to make easier the operative of your company, foundation, association, etc.