31 March 2020 – Impacts of COVID-19
Corporate law temporary exceptional measures
Further to the health emergency law n°2020-290 voted on March 23, 2020 which has declared a state of health emergency for 2 months, i.e. to date up until May 24, 2020, several orders have been adopted by the government in relation to corporate law. The main measures in force are as follows:
- Paperless processes: requests made by a shareholders for the disclosure of a document or prior information can validly be satisfied by email;
- The attendance in person requirement at general meetings is facilitated for shareholders and any person likely to attend such meetings, such as the statutory auditor or employee representative, as follows:
- Video or telephone conferencing (as well as any other electronic means of communication guaranteeing the identification and the effective participation of the shareholders) is exceptionally authorized, notwithstanding legal provisions applicable to certain types of companies and the provisions of the companies’ articles of association stating the contrary. Their implementation must however enable the participants’ voice to be transmitted and must satisfy “technical characteristics that allow the continuous and simultaneous retransmission of deliberations“;
- Written consultations in lieu of general meetings is made available for certain companies for may legally provide for this even if the articles of association are silent on this or if they expressly exclude this possibility
- The use of video or telephone conferencing (as well as any other electronic means of communication) is exceptionally authorized for management bodies’ meetings (Board of Directors, Supervisory Board, Management Board, etc.), without any statutory or regulatory provision being necessary or being able to prevent such use. Again, their implementation must guarantee the identification of the board members and their effective participation. Hence, the law provides that the means used must satisfy “technical characteristics allowing continuous and simultaneous retransmission of the deliberations“.
- Management bodies may also consult their members in writing when taking decisions, “under conditions ensuring collective deliberations“.
- The above mentioned measures are applicable from March 12, 2020 until July 31, 2020, unless extended to a later date fixed and no later than November 30, 2020.
- Finally, for most companies that are obliged to hold an AGM within six months of the end of their financial year, this period is extended by three months, for companies closing their accounts between September 30, 2019 and up until one month following the date of expiry of the health emergency period, i.e. to date June 24, 2020. This extension applies in particular to those companies which have closed their accounts on December 31, 2019.
A decree, which is expected to be published shortly, should specify a number of measures.