Fernando Rodríguez | The season of annual shareholders’ meetings is just around the corner and Spain’s major listed companies are urging the Government to legislate with the utmost urgency so that they can hold virtual shareholders’ meetings with full legal coverage. “We don’t have the leeway we had last year, which was justified by the Covid19 pandemic, and there is a risk that the decisions made at the meetings could be challenged,” sources close to this initiative, which is supported by at least forty companies, told Consenso del Mercado.
The main Spanish issuers had hoped that the new legislation transposing SRD II – also known as the Long-Term Investment Directive – would have come into force by now. It includes the possibility for companies to call and hold meetings exclusively by electronic means of their own accord and without the need to change their articles of association, provided that all the rights of shareholders and investors are guaranteed, as specified in an amendment introduced by the PSOE.
However, it is highly unlikely that this piece of legislation, which is now in the Senate after having completed the amendment process in Congress, and which is more than two and a half years behind schedule, will have come into force by the time the 2021 season of annual shareholders’ meeting starts, according to several sources consulted.
The aforementioned group intends to request from the General Secretariat of the Treasury and Financial Policy, under the MoE, the passing of a Royal Decree -”which should be ready in one or two weeks, because there are companies that closed their financial year in September and have to call a meeting soon”-, and from the Association of Registrars and/or from the CNMV a communication similar to the one that both institutions issued when the Covid 19 pandemic broke out in March last year, in which, among other things, they gave information on how to hold virtual meetings.
The virtual shareholders’ meetings held in Spain in the 2020 financial year were recognized, for their number and quality, as best practice in Europe by Georgeson and according to the same sources, that would support the request for new legislation on this matter.