Holding of General Meetings in Hong Kong
by Using Virtual Meeting Technology
The Companies Ordinance (“CO”) and the Companies Model Articles Notice (“Model Articles”) will be modified by an Amendment ordinance coming into operation on 28 April 2023.
It aims to simplify the process of holding general meetings (“GM(s)”) in Hong Kong limited companies while ensuring the protection of stakeholders’ interests but also to allow companies to make better use of new technologies.
A private company and a company limited by guarantee must hold a GM within 9 months after the end of their accounting reference period1. The manner of holding a GM is governed by the provisions in the CO and the Model Articles (Cap. 622H) as well as provisions of the company’s own articles of association.
According to the new regulation, there are 3 ways to hold a GM:
- At a physical venue,
- By using virtual meeting technology, or
- Both at a physical venue and by using virtual meeting technology.
Companies should choose the most appropriate mode of meeting. They will need to consider, in addition to convening a valid meeting in accordance with the law and their articles of association, whether a physical meeting continues to be the most appropriate mode or if holding a fully virtual or hybrid GM may promote better engagement with and maximize participation by members.
The following will address the two newly admitted ways of holding a GM in the light of the Amendment ordinance. A third point will explain the convening rules, before a conclusion.
- Virtual meetings
The Amendment Ordinance offers a definition of “Virtual meeting technology”: it is a technology that allows a person to listen, speak and vote at a meeting without being physically present at the meeting.
A company may hold a GM by using virtual meeting technology unless the company’s articles expressly prohibit the holding of a GM by using virtual meeting technology or require a GM to be held only at a physical venue.
The possible indication in the articles of association that the meeting must be held in a specific physical location does not imply an obligation to hold the meeting in a physical location and therefore does not prohibit the use of virtual meeting technology.
A person using virtual meeting technology is to be regarded as attending the meeting if:
- the person uses the virtual meeting technology specified in the notice of the meeting and,
- the person is able to exercise his or her right to speak and vote at the meeting.
- Hybrid meetings
When a GM of a company is held at 2 or more physical venues, the company must use any technology that allows the members of the company who are not together at the same physical venue to listen, speak and vote at the meeting regardless of whether virtual meeting technology is also used for holding the meeting.
- Convening rules
When a company notifies a member of the availability of a notice of a GM on a website, the notification must specify, among other matters, the physical venue of the meeting or the virtual meeting technology to be used for holding the meeting, or both.
- Conclusion
The Amendment ordinance offers new ways to hold GMs in a legal environment that already has great flexibility. Indeed, it must be reminded that Hong Kong laws offer, and will continue to offer, the option not to hold a GM in the following circumstances: when all the shareholders (or the sole shareholder if applicable) of the company unanimously approve and sign written resolutions on the matters being the agenda of a GM .
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For any information on holding an GM in Hong Kong, please contact our team to info@opkofinance.com.
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