Company with listed shares? – 4 things to consider before the annual general meeting
Companies with listed shares are required to publish notices of general meetings in due time prior to the meetings, and it is therefore important to start the planning well in advance.
Norwegian public limited liability companies with shares admitted to trading on the Oslo Stock Exchange or Euronext Expand are required to publish notices of general meetings no later than 21 days before the meeting, together with any attachments. For Norwegian public and private limited liability companies with shares admitted to trading on Euronext Growth, the deadlines for publishing the notices are 14 and seven days before the meeting, respectively, although without the requirement to include attachments. Below, we list four items to be considered when planning a general meeting.
1. Election of meeting form
The board decides whether the general meeting is to be conducted as a physical meeting with the possibility of electronic participation (hybrid), or if the meeting is to be held as an electronic (digital) meeting only. The board has a duty to ensure that the proceedings of the general meeting are carried out adequately. This includes ensuring that the systems for remote participation give all shareholders the ability to exercise their shareholder rights, and that the authentication and control of shareholders' participation and voting is secure and satisfactory. The board may decide on the meeting form on a discretionary basis, unless otherwise limited by the company's articles of association. The further statutory requirements for conducting the general meetings depend on whether they are conducted as hybrid meetings or digital meetings (see section 5-8 and 5-8a of the Norwegian Public Limited Liability Companies Act (Nw.:"allmenaksjeloven")).
2. Digital general meeting
Many companies hold digital (virtual) general meetings. While more solutions are currently under development, as at today (17 February 2023), only a limited number of providers offer digital solutions that are adequate for listed companies with a high number of shareholders. Depending on the company's choice of services, solutions may include allowing shareholders to follow the meeting in real time on a video broadcast, vote on items, submit questions, and digitally ask for the floor. The services are generally priced based on the company's total number of shareholders, but in return allow the company to outsource the practicalities connected to the meeting. Please note that a provider of video services may have to be to engaged separately.
3. Provisions to simplify the general meeting
The Norwegian Public Limited Liability Companies Act allows companies to include certain provisions in their articles of association that may accommodate and simplify the organization and carrying out of general meetings, including that shareholders may cast their votes in advance of the meeting (section 5-8b), and that documents relating to matters to be dealt with by the general meeting may be made available on the company's website instead of being sent to each of the shareholders (section 5-11a). We recommend that companies with shares admitted to trading implement these provisions in their articles of association, in order to ensure an adequate and effective general meeting.
4. New regulations in the Norwegian Public Limited Liability Companies Act and potential amendments to the articles of association
With effect from 1 July 2023, new rules and amendments to the Norwegian Public Limited Liability Companies Act will enter into force. Some of the amendments may impact the carrying out of general meetings.
- Shareholders' right to attend the general meeting (record date). As of 1 July 2023, pursuant to section 5-2 of the Norwegian Public Limited Liability Companies Act, only those who own shares five business days before the general meeting (record date) will have the right to attend and vote at the meeting. This means that a shareholder on the record date must be registered in the shareholders' register or must have given notice and satisfactory documentation for the purchase of shares. Shares purchased after the record date will not include a right to attend and vote at the respective general meeting, while the right to attend and vote will remain for shares sold after the record date. The record date must be included in the notice of the general meeting.
- Consequently, any existing provisions in the articles of association regarding the record date will be redundant, and should be removed.
- Notice of attendance for owners of shares registered in nominee accounts who want to attend the general meeting. As of 1 July 2023, beneficial owners of shares registered in a nominee account will have the right to attend the general meeting without having to re-register the shares to an account in their own name, provided that the share owner gives notice of attendance to the company. Such notice must be have been received by the company no later than two business days before the general meeting, unless a later deadline is stated in the notice of the meeting. The requirement of advance notice will apply to owners of shares in nominee accounts regardless of whether such advance notice is required for other shareholders pursuant to the company's articles of association, see below. This will represent a simplification compared to the current regime.
- Notice of attendance for owners of shares not registered in nominee accounts. The possibility of including a provision in the articles of association requiring owners of shares that are not registered in a nominee account to give notice of attendance, will remain. Such notice must also have been received by the company no later than two business days before the meeting, unless a later deadline is stated in the notice of the general meeting.
- Companies should consider removing potential provisions in their articles of association regarding advance registration.
Other amendments to the Norwegian Public Limited Liability Companies Act entering into force on 1 July 2023:
- transparency on beneficial owners of shares registered in nominee accounts (amendment to section 4-5);
- the company's notice to beneficial owners of shares registered in nominee accounts, and the nominees' obligation to assist therewith (new section 1-8); and
- a right for the company and public authorities to receive information about beneficial owners of shares registered in nominee accounts and their ownership, including number of shares and share class, if relevant (amendment to section 4-10).