Section 325: Notice of meeting to contain statement of rights
571. This section replaces sections 372(3) and 372(4) of the 1985 Act with changes consequential on the extended rights to appoint proxies under section 324. The new provision requires every notice calling a meeting to contain a statement informing the member of his rights to appoint one or more proxies and any more extensive rights conferred by the company’s articles. Failure to include such a statement will not invalidate the meeting, but is an offence attracting a fine for every officer of the company found in default.
Section 326: Company-sponsored invitations to appoint proxies
572. This section reproduces the effect of section 372(6) of the 1985 Act and requires a company to ensure that if it invites members to appoint a particular person or persons as proxy, such an invitation must be issued to all members entitled to vote at the meeting. Subsection (2) lists two exceptions to the requirement. Failure to comply attracts a fine for every officer in default.
Section 327: Notice required of appointment of proxy etc
573. This section replaces section 372(5) of the 1985 Act. There are two changes. The first relates to the timing required for a notice of proxy appointment. The new provision ensures that weekends, Christmas Day, Good Friday and any bank holiday are excluded from the time counting towards the minimum 48 hour notice required to appoint proxies. This means, for example, that for a meeting to be held at 3.00 pm on a Tuesday after a bank holiday Monday, the cut-off point for proxy appointment will be 3.00 pm the previous Thursday, not 3.00 pm on Sunday as under the 1985 Act. The second is that polls which are not taken immediately are covered by the rules as well as meetings and adjourned meetings.
Section 328: Chairing meetings
574. This section provides as a default rule, subject to the articles, that a proxy may be elected as chairman of a general meeting by resolution of the company passed at the meeting.
Section 329: Right of proxy to demand a poll
575. This section sets out the way in which a proxy may participate in a demand for a poll.
Section 330: Notice required of termination of proxy’s authority
576. This section provides a default regulation to replace article 63 of Table A. This ensures that, subject to the articles, an appointed proxy’s actions at a meeting are valid unless notice of termination of the proxy’s authority is given before the meeting starts. The company’s articles may specify a longer advance notice period but this cannot be more than 48 hours in advance of the meeting (excluding weekends, Christmas Day, Good Friday and bank holidays).
Section 331: Saving for more extensive rights conferred by articles
577. This section makes clear that the company’s articles may confer more extensive rights than are provided for under the provisions of the Bill on members and their proxies.
Section 332: Resolution passed at adjourned meeting
578. This section reproduces the effect of part of section 381 of the 1985 Act as it applies to members’ meetings. It ensures that a resolution of the members of the company passed at an adjourned meeting is treated as passed on that date and not on any earlier date. The reference to class meetings in section 381 is dealt with by section 334.
Section 333: Sending documents relating to meetings etc in electronic form 579. This section needs to be read together with the provisions about electronic communications to companies in Part 3 of Schedule 4. Taken together these provisions allow a member to communicate with the company by electronic means where the company has given an electronic address in a notice calling a meeting or in an instrument of proxy or proxy invitation.
Application to class meetings
Section 334: Application to class meetings
580. This section applies the provisions of this Chapter with some modifications to meetings of holders of a class of shares in companies having a share capital.
Section 335: Application to class meetings: companies without a share capital
581. This section applies the provisions of this Chapter with some modifications to meetings of classes of members of companies without a share capital.
582. The requirements for public companies relating to annual general meetings are set out in this Chapter. The main substantive changes to the 1985 Act are, as the CLR recommended, that:
• private companies will no longer be required to hold an AGM. The provisions of this Chapter therefore do not apply to private companies; and
• public company AGMs must be held within six months of their financial year-end.
Section 336: Public companies: annual general meeting
583. This section replaces section 366 of the 1985 Act but will apply only to public companies since private companies are no longer to be required to hold an AGM. Where section 366 required an AGM to be held each year and not more than 15 months after the previous AGM, a public company will now be required to hold an AGM within 6 months of its financial year-end. This new requirement is intended to ensure that shareholders have a more timely opportunity to hold the directors of a public company to account.
Section 337: Public companies: notice of AGM
584. This section reproduces the effect of parts of section 369 of the 1985 Act relating to the AGM notice. The minimum notice period for calling a public company AGM is 21 days as set out in subsection (2) of section 307 or longer if provided for in the company’s articles. An AGM may be called at shorter notice if all members of the company agree.
Section 338: Public companies: members’ power to require circulation of resolutions for AGMs
585. This section, with section 339, replaces sections 376 and 377 of the 1985 Act (to the extent that they relate to resolutions proposed by members to be moved at an AGM). Members holding at least 5% voting rights or at least 100 members holding on average £100 paid-up capital have the right to propose a resolution for the AGM agenda and to require the company to circulate details of the resolution to all members. A change from the existing legislation is that the shares must in each case carry rights to vote on the relevant resolution. The key policy change is that, if the members’ request is received before the financial yearend, then the members are not required to cover the costs of circulation.