We previously reported that on April 21, 2020, the Minister of Public Safety and Solicitor General issued a Ministerial Order with respect to hosting corporate meetings electronically until the declaration of a state of emergency throughout British Columbia is cancelled or expires (the “Ministerial Order”).
On May 20, 2021, the government of British Columbia passed the Financial Statutes Amendment Act (No. 2), 2021 (“Bill 9”) which gives companies, societies, credit unions and co-operative associations the permanent ability to host fully or partially electronic meetings provided certain conditions are met.
Scope of the new legislation
Bill 9 introduces amendments to the following acts (the “Corporate Enactments”):
- Business Corporations Act;
- Cooperative Association Act;
- Credit Union Incorporation Act;
- Financial Institutions Act; and
- Societies Act.
Organizations governed by the Corporate Enactments can hold corporate meetings by telephone or any other communications medium if the following conditions are met:
- the notice of the meeting must set out the communications medium to be used, contain instructions for attending and participating in the meeting, and if applicable, include instructions for voting at the meeting;
- all persons attending the meeting must be able to participate; and
- the organization holding the electronic meeting must permit and facilitate participation in the meeting.
Electronic meetings can be fully or partially electronic:
- “Fully electronic meetings” means attendees will be entitled to participate only by telephone or other communications medium.
- “Partially electronic meetings” means attendees will be entitled to participate by telephone, by other communications medium, or in person.
Each of the Corporate Enactments, except the Financial Institutions Act, have specific location requirements for corporate meetings. However, these location requirements will not apply to fully electronic meetings, and for partially electronic meetings, the location requirements will only apply to those attending the meeting in person.
If a corporate meeting is held solely by telephone or another communications medium, the notice of the meeting does not have to specify a location.
Other Proposed Amendments
Bill 9 also includes several amendments specific to each of the Corporate Enactments.
Under the Business Corporations Act (“BCA”), if a meeting of the directors is held as a fully electronic meeting, then directors cannot participate in person. The Lieutenant Governor in Council may also create regulations related to electronic meetings held under the BCA.
Under the Cooperative Association Act, if a meeting is an electronic meeting, members cannot vote by proxy. If a meeting of directors is held as a fully electronic meeting, no director may participate in person.
Under the Credit Union Incorporation Act, voting by show of hands is restricted to meetings that are not electronic.
Under the Financial Institutions Act, the BC Financial Services Authority is authorized to make rules with respect to credit unions’ electronic meetings.
Under the Societies Act, the Lieutenant Governor in Council is empowered to make regulations with respect to electronic meetings of a society’s directors, members or creditors.
If before May 20, 2021, an organization governed by the Corporate Enactments, provided notice of a meeting to be held on or after May 20, 2021, and such notice was provided in accordance with the Ministerial Order, then that notice is deemed to be provided in accordance with the Corporate Enactments.
For more information regarding your rights and obligations with respect to corporate meetings, please do not hesitate to contact one of our lawyers in the Corporate/Commercial Practice Group.