From meeting room to screen: the future of meetings legally regulated

Anyone who sits on the board of an association, foundation or company will recognise this: organising the general meeting can be quite an operation. Finding a suitable venue, ensuring that everyone can physically attend, distributing documents on time, counting votes. It's all easier said than done, especially when board members or shareholders are spread across the country (or the world).

During the coronavirus pandemic, we were suddenly presented with an alternative: digital meetings. Out of necessity and on a temporary basis, organisations were allowed to hold their general meetings via video conferencing. And what did we discover? In many cases, it worked very well. People logged in from home, voted digitally and were able to ask questions as usual. It was faster, more efficient and required less organisation. However, it was not legally permitted on a permanent basis; it was only allowed under temporary emergency legislation.

This may be about to change. With the ‘Bill on digital general meetings of private legal entities’, digital meetings will become a possibility. This law amends the Civil Code so that fully digital meetings are legally valid.

What exactly will change? First of all, it is important to note that digital meetings will not be allowed automatically. The law provides the option, but it is up to the legal entity to explicitly choose it. Only if the articles of association of the legal entity state that a general meeting may be held digitally will this be legally permitted. Ironically, in most cases, adding this provision still requires a physical meeting, in which the change must first be approved.

The digital meeting must then meet a number of requirements. It is not sufficient to offer participants a live stream and then have them confirm the decisions by email. The meeting must be truly live and participants must have the opportunity to make comments and ask questions. It is not mandatory for a member to have their camera on for the entire meeting or to ask questions via the microphone. If there is a live chat function, this may also suffice.

The chair of the meeting plays an important role in this. He or she must ensure that the meeting runs smoothly, that participants are heard, and that voting takes place in a secure and reliable manner. The technology used must therefore function properly and participants must be able to identify themselves. If the connection fails or some of the members cannot access the meeting, this may affect the legal validity of the decisions taken.

The law applies to all legal entities under private law, such as associations, cooperatives, mutual insurance companies, foundations, private limited companies and public limited companies. The measure is not only intended for large companies or listed companies. Small associations or foundations in particular can also benefit from this flexibility. Think of sports clubs with members living abroad, or foundations with an international board.

However, the transition to digital meetings will not be straightforward for everyone. Some organisations value physical meetings because they facilitate communication. There are also concerns about accessibility; not everyone is equally digitally literate, and online meetings require different preparation and support.

Nevertheless, the law is responding to a social movement. Digitalisation is now an integral part of our daily lives. Organisations are being given more freedom to choose how they want to organise their meetings. Those who prefer physical meetings can continue to do so. But those who want to switch to digital will finally have the opportunity to do so.

The coming period is a good time for many boards to review their articles of association. Do any changes or additions need to be made? And what resources will be needed to meet the new requirements? The law will soon give us the opportunity to do so, but there is still work to be done.

If you need help organising a shareholders' meeting or have any other questions, our corporate lawyers will be happy to assist you!