Due to the COVID-19 pandemic, Thai government has introduced multiple measures, including tax relief measures, to safeguard the citizens and stimulate businesses that have been significantly affected during the pandemic. As the Annual General Meeting (AGM) season is around the corner, many listed firms have concerns over their forthcoming meetings. Holding physical convention with a considerable number of shareholders may put the shareholders at risk of getting infected by the virus.
Hence, many Thailand authorities, including the Office of the Securities and Exchange Commission and the Ministry of Commerce, have provided measures and guidelines to handle the situation and the restrictions for listed businesses to hold an AGM of shareholders. This article will guide you through the highlights of the guidelines.
Guidelines by the Office of the Securities and Exchange Commission
Instead of physical attendance, the Office of the SEC encourages shareholders to permit proxies to independent directors. This permissibility should be noted in the AGM announcements if the announcement has yet been sent out. If notifications have been sent out, firms may inform their shareholders via electronic mails. Also, this should be revealed on SET Link in both situations.
Listed firms must adhere to the guideline of the Department of Disease Control on COVID-19 prevention concerning conferences, seminars, or other similar ventures, as well as any other relevant measures issued in the future.
If the companies want to use electronic meetings or teleconferences (to the extent allowable), they have to utilize a reliable system as prescribed in the Ministry of Digital Economy and Society’s guidelines. However, these types of meetings can only be used by a limited public entity if they are mentioned in the entity’s articles of association.
Guidelines by the Stock Exchange of Thailand
SET suggests listed entities to consider utilizing the following measures as fitting to assist shareholders who cannot attend the AGM in person:
- Broadcasting the meeting through online platforms, such as Zoom, Webinar, and Facebook.
- Permit shareholder to send inquiries in advance and record the answers to such queries in the minutes
SET advised listed firms to abide by the COVID-19 Guidelines and state the measures they would utilize in their meetings notices and disclose the same through their SET Link or website. The recommended guidelines are only to assist the shareholders. However, listed agencies still need to hold AGMs in compliance with the regulation; wherein the quorum should be no less than twenty-five number of shareholders and no fewer than one-third of the provided shares.
Guidelines by the Ministry of Commerce
Following the declaration of Ministry of Public Health on COVID-19 as a dangerous contagious disease, the Department of Business Development, Ministry of Commerce has issued alleviating measures, permitting Thailand firms that cannot hold a meeting within the set deadline required by law to submit a letter of clarification to the MOC on a case-to-case basis after conducting the sessions.
Even though the MOC’s wording is not explicit, its measure should also apply to meetings with specified deadlines under the regulation, including AGMs that needs to be held within four months following financial year-ends. This measure applies to public firms, private limited entities, trade associations, and chambers of commerce that have been hit by the pandemic.
What can listed companies do to prevent the spread of infection?
As per the issued guidelines, listed agencies are encouraged to utilize a proxy approach and the available measures to avoid the spread of the infectious virus. If these measures are used, they should be clearly expressed in the annual general meeting announcement and revealed on SET Link.
Listed company incorporation should also note that the submission deadline of the financial statements to the Ministry of Commerce is one month from the meeting date on which the shareholders approve the financial statements. Hence, if the annual general meeting is postponed due to any legitimate reason, the submission deadline for the financial statements should also be delayed. Nonetheless, it is crucial to wait and see if other authorities, such as the Revenue Department, would loosen up their relevant regulations with regards to the financial statements too.
These measures are by no means absolute. Relevant authorities may issue further guidelines for company incorporation in dealing with the COVID-19 outbreak according to the current circumstances. Hence, companies should stay alert on any upcoming instructions.