Out-Law Guide | 31 Jul 2020 | 4:38 pm | 2 min. read
The proposed measures in The Companies (Miscellaneous Provisions) (Covid-19) Bill 2020 will temporarily amend certain areas of the Companies Act 2014 (the Act) and the Industrial and Provident Societies Acts 1983 to 2018 (1983 Act).
If the Bill is enacted, the temporary measures will remain in place until 31 December 2020. However, the Bill also provides for an extension of these measures beyond this date if necessary.
The Bill seeks to ease the law in respect of document execution.
Ordinarily, two directors or one director and the company secretary are required to countersign a single document to which the company's common seal is applied. Under the proposed legislation, documents may now be signed and sealed in different counterparts.
The Bill introduces some relaxations around the requirements for convening and conducting general meetings. These include:
The Bill introduces similar amendments to the 1893 Act around general meetings. These would permit registered societies to delay AGMs until before 31 December 2020; conduct general meetings by electronic means; and cancel or change the date of general meetings.
The Bill allows certain creditors' meetings, such as in winding up or examinership proceedings, to be conducted wholly or partly by electronic means provided all those entitled to attend have a reasonable opportunity to participate.
For companies in examinership, the maximum period of court protection from creditors may be extended from 100 to 150 days. This extension would be at the discretion of the court, and would only apply in exceptional circumstances.
The Bill proposes that the debt threshold for the commencement of a winding up by the court would be increased from €10,000 for individual debts or €20,000 for aggregate debts to €50,000.
The Bill introduces a new provision to the Act, which places a statutory fiduciary duty on directors of a company approaching insolvency to have regard for the interests of the company's creditors and to preserve company property.
Co-written by Maeve O'Brien of Pinsent Masons, the law firm behind Out-Law.
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