ASIC Corporations (Extension of Time to Hold AGM) Instrument 2021/770

Overview

The ASIC Corporations (Extension of Time to Hold AGM) Instrument 2021/770, enacted in 2021, addresses the problem of financial and administrative burdens on companies due to the COVID-19 pandemic by providing extensions to the time limits for holding annual general meetings (AGMs). This legislative instrument was made under section 253T of the Corporations Act 2001 by the Australian Securities and Investments Commission (ASIC). The policy objective of this instrument is to alleviate the difficulties faced by companies in complying with statutory requirements during the pandemic, thereby supporting the operational continuity and stability of these companies. This instrument specifies extensions to the time frames for holding AGMs for certain public companies, contingent on their financial year-end dates, to provide flexibility and relief from strict deadlines.

Scope and Application

The ASIC Corporations (Extension of Time to Hold AGM) Instrument 2021/770 applies to public companies with specific financial year end dates, allowing them to extend the timeframe within which they must hold their Annual General Meeting (AGM). This instrument is applicable to public companies with a financial year ending between 21 February 2021 and 7 July 2021, with a two-month extension granted to those companies excluding public companies limited by guarantee. It also applies to public companies limited by guarantee with a financial year ending between 24 January 2021 and 7 April 2021, which are granted a four-month extension, and to public companies (other than listed public companies) with financial years ending between 24 December 2021 and 7 January 2022 and between 24 June 2022 and 7 July 2022, with a one-month extension. This instrument is made under section 253T of the Corporations Act 2001 and unless revoked earlier, it is repealed at the end of 12 months after the date on which it commences.

Key Provisions

The ASIC Corporations (Extension of Time to Hold AGM) Instrument 2021/770 (the "Instrument") extends the time period in which certain public companies must hold their Annual General Meetings (AGMs) as prescribed in the Corporations Act 2001 (the "Act"). Specifically, Section 5(1) of the Instrument extends the period for public companies, other than those specified in subsection (2), with financial years ending between 21 February 2021 and 7 July 2021 by two months. Section 5(2) extends the period for public companies limited by guarantee with financial years ending between 24 January 2021 and 7 April 2021 by four months. Additionally, Section 5(3) extends the period for public companies, other than listed public companies, with financial years ending between 24 December 2021 and 7 January 2022 or between 24 June 2022 and 7 July 2022 by one month. Under the Instrument, the public companies mentioned are obligated to ensure that their AGMs are held within the extended periods specified. These obligations are to be met in compliance with the Corporations Act 2001. The Instrument's provisions also clarify that a public company limited by guarantee with a financial year ending between 8 April 2021 and 7 July 2021 can rely on the two-month extension specified in subsection (1). The Instrument, unless revoked earlier, will be repealed at the end of 12 months from the commencement date, as per subsection 253T(5) of the Act. Failure to comply with the provisions of the Instrument may result in legal consequences. While the Instrument itself does not specify particular offences, penalties, or civil/criminal consequences for non-compliance, such breaches may be subject to the general provisions of the Corporations Act 2001. These may include fines and, in severe cases, imprisonment for directors and officers found in breach of their statutory obligations. It is important for companies to adhere to the extended timeframes to avoid potential legal ramifications.