PART 3 (ii)
(12)
ANNUAL GENERAL MEETING (AGM)
EXISTING LAW
“Annual General
Meeting” is defined under Section 143 as
(1) A
general meeting of every company to be called the "annual general
meeting" shall in addition to any other meeting be held once in every
calendar year and not more than fifteen months after the holding of the last
preceding annual general meeting, but so long as a company holds its first
annual general meeting within eighteen months of its incorporation, it need not
hold it in the year of its incorporation or in the following year.
(2)
Notwithstanding subsection (1) the Registrar on the application of the company,
may if for any special reason he thinks fit so to do, extend the period of
fifteen months or eighteen months referred to in that subsection,
notwithstanding that such period is so extended beyond the calendar year.
(3) Subject
to notice being given to all persons entitled to receive notice of the meeting
a general meeting may be held at any time and the company may resolve that any
meeting held or summoned to be held shall be at the annual general meeting of
the company.
(4) If
default is made in holding an annual general meeting—
(a) the
company and every officer of the company who is in default shall be guilty of
an offence against this Act;
Penalty: Five thousand ringgit.
Default penalty: One hundred ringgit; and
Default penalty: One hundred ringgit; and
(b) the Court may on the application of any member order a general
meeting to
be called
THE NEW LAW WILL INCORPORATE THE FOLLOWING
- Public
companies are required to hold AGM every calendar year
- The
law does not require private companies to hold AGM in every callender
year.
- Meetings
of private companies are known as meeting of members.
- The
main method for private companies to make decision will be by way of
written resolution.
As usual, AGM is still
required for Public companies to ensure that the director use the AGM as a
platform to report to shareholders.
However in the case of
private companies (ie SDN BHD) where in
most cases its shareholders and directors are the same people, the AGM accorded
through the AGM platform is no longer relevant.
However, notwithstanding
the above. Shareholders still have the right to call for meeting when required.
RESOLUTION IN WRITIG (Circular resolution)
EXISTING LAW
Written Resolution
requires unanimous vote before resolution could be passed.
That is, resolution must
be signed by all members – in case of members resolution and all directors in
case of directors resolution.
NEW LAW
- Provision relating to written resolution are
only applicable to private companies.
- The required percentage to pass a resolution
will be similar as though the resolution would be passed at a meeting of
members.
This is deregulatory
measures to provide flexibility for private companies to make decision more
efficiently.
EXISTING LAW
Threshold allowing
circulation of statement by members holding at least 5% of paid up capital or
100 members can request for circulation of statements.
NEW LAW
- Member’s
power to require circulation of written resolution.
- Members
having a total of 2.5% voting rights or 50 members wo have right to vote
and for companies not having a share capital, members having a total of
2.5% voting right to be allowed to a statement to demand, alter or add
items into AGM’s agenda. However, the company has the option of not to
circulate the statements if they are frivolous, vexatious or defamatory
and if such statement is not in the best interest of the company
Reason why the above provision are introduced
The lowering of the
threshold would make it easier for members to be involved and to determine the
agenda for deliberation in the general meeting.
It also enhances
shareholders’ activism.
It provides an avenue of
escalating external pressure to create change as well as to increase company’s
efficiency.
MEETINGS AT TWO OR MORE VENUES
The current law allows
- A company may hold meetings within
NEW LAW
- A
company may hold meeting at more than one venues using any technology or
method that enables member of the company an opportunity to participate
and exercise their right to speak and vote at the meeting.
- Main
meeting venue shall be in
The above proposal is made
to accord flexibility to companies when holding meeting of members.
APPOINTMENT OF PROXIES
EXISTING LAW
Appointmnet of Proxy
- Proxy can be appointed from amongst members of
the company.
- Otherwise proxies shall be an advocate, an
auditor or person approved by the Registrar.
NEW LAW
Appointmnet of Proxy
- A
member of a company may appoint another person as his proxy.
- Dispensation
of qualification of proxy.
The above proposal is made
to allow members to decide on who should be the most appropriate person to
represent him at the meeting of members.
The proposed amendment is
very cautious to any possible abuse of right or power while maintaining
flexibility to attain efficiency in companies.
To be continued on PART 3 –(iii)
Mohdar Ismail
Company
Secretarial Practitioner
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