Publicly traded companies might be allowed to delay their annual shareholders’ meetings until after next month given a surge in COVID-19 infections in Taiwan, Financial Supervisory Commission (FSC) Chairman Thomas Huang (黃天牧) said yesterday.
The commission would speak with the Ministry of Economic Affairs and the Ministry of Health and Welfare to reach a decision within two weeks, Huang told a meeting of the legislature’s Finance Committee in Taipei.
The Securities and Exchange Act (證交法) requires listed companies to hold their annual general meetings by the end of June or face a fine of NT$240,000 to NT$4.8 million (US$8,577 to US$171,539).
Photo: Wang Yi-sung, Taipei Times
The commission would look to the Special Act for Prevention, Relief and Revitalization Measures for Severe Pneumonia with Novel Pathogens (嚴重特殊傳染性肺炎防治及紓困振興條例) and study whether listed firms could be exempted from the requirements of, Huang said.
“The advantage [of delaying meetings] would be to reduce public gatherings and help contain the spread of COVID-19, but delaying them would affect stock-related affairs, such as dividend distributions,” he said.
Listed companies are required to announce their book closure dates at least 60 days before their shareholder meetings so they can finalize their shareholder rosters.
Only shareholders on the roster are eligible to attend the meetings.
If companies are permitted to delay the meetings to later than next month, they might need to reschedule the book-closure dates, which would also affect shareholders’ interests, Huang said.
The commission would weigh the pros and cons, he said.
Democratic Progressive Party Legislator Shen Fa-hui (沈發惠) told the committee meeting that many nations and other administrations have allowed firms to postpone shareholders’ meetings amid the pandemic, including China, Dubai, France, Germany, Singapore, Thailand, the UK, the US and Vietnam.
The commission is also mulling whether companies should be allowed to hold shareholder meetings via videoconferencing, but there are some technical issues.
Companies would find it difficult to authenticate shareholders’ identities online and count their real-time votes, Securities and Futures Bureau Deputy Director-General Tsai Li-ling (蔡麗玲) said on Tuesday.
Another problem is whether videoconferencing software allows sufficient overlapping log ins, Tsai said.
Moreover, if a videoconference breaks up or there is a bad connection, it would compromise shareholders’ rights, she said, adding that it is foreseeable that “controversies would occur.”
In related news, the commission said that the nation’s financial services would remain normal even if the COVID-19 alert is raised to level 4, while banks are encouraged to lower handling fees, as people would use online banking services and ATMs more instead of going to branches.
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