The Companies Act 2006 (the '2006 Act') - In Force From 1 October 2007

By Nick Davis and Felicity Bryson

Practical changes to company meetings and resolutions

Annual General Meetings (AGMs)

Under the 2006 Act, private companies are no longer required to hold AGMs (but public companies will still be required to do so). Public company AGMs require 21 days' notice under the 2006 Act.

If a private company does decide to continue holding AGMs, only 14 days' notice will be required.

For their next financial year ending on or after 1 October 2007, private companies will not have to lay accounts and reports before general meetings (unless their memorandum or articles require them to do so).

Extraordinary General Meetings (EGMs)

The phrases "extraordinary general meeting", "EGM" and "extraordinary resolution" are no longer used under the 2006 Act.

Any relevant provisions on the passing of resolutions in a company's articles must be followed, in addition to the statutory provisions.

If more than 12 months have elapsed since the end of the last general meeting called at the request of members of a private company, members holding 5% of the company's share capital may now requisition a general meeting (as opposed to 10% under the Companies Act 1985 (the "1985 Act")).

Members may make their request for a general meeting in electronic form.

If a company gives its electronic address in a notice of general meeting or in an instrument of proxy, members are then permitted to communicate with the company by email.

Records of general meetings no longer have to be kept for an indefinite period - they only have to be kept for 10 years.

Notice of EGMs

The notice period for all general meetings of a company (other than for AGMs of a public company) will be 14 days, regardless of the type of resolution proposed to be passed at the meeting.

Shorter notice may be agreed by a majority in number of the members having the right to attend and vote at the meeting who together hold the "requisite percentage" in nominal value of the voting shares - for private companies this will be 90% (lower than the 95% under the 1985 Act) and for public companies this will remain at 95%.

Companies may also elect to serve notice of meetings by means of a website, and they will be required to notify members of the presence of the notice on the website and to provide them with certain prescribed information.

Proxies

Members of both private and public companies will have the right to appoint a proxy to attend, speak and vote at meetings on their behalf.

Weekends and bank holidays are excluded from the time counting towards the minimum 48 hour notice period required to appoint proxies.

If a company gives an electronic address either in a proxy instrument or in an invitation to appoint a proxy, the company is deemed to have agreed that members may send the proxy documentation for that meeting by email to that address.

Where the chairman of a meeting of a UK issuer holds discretionary proxies representing more than 3% of the voting rights of the company, the chairman will have a notification obligation under the Disclosure Rules and Transparency Rules.

Record Keeping Requirements

The current requirement to keep records of resolutions...