Guidelines for meeting upcoming AGM and financial reporting requirements following Coronavirus

 

Annual General Meetings

Coronavirus (COVID-19) may temporarily impact companies’ ability to hold an annual general meeting (AGM). This issue is most immediately relevant for listed and unlisted public companies with 31 December balance dates that are required to hold an AGM by 31 May 2020.

For These Entities, ASIC:

• Confirms it will take no action if the AGMs are postponed for two months; that is, until the end of July
• Supports the holding of AGMs using appropriate technology.

The full text of our ‘no action’ position is attached.

ASIC cautions entities against holding an AGM while there are restrictions on large gatherings unless the entity can provide members as a whole with a reasonable opportunity to participate in the meeting.

Commissioner John Price said a degree of flexible pragmatism was needed to deal with the issue. ‘Consistent with the Council of Financial Regulators’ statement that they would move to adjust the timing of regulatory initiatives so financial institutions could concentrate on their businesses and assist their customers, we will focus on helping entities with the difficulties created by this situation.

‘Our position is under continuous review. We are liaising closely with advisors and industry bodies so that we can understand our stakeholders’ needs and respond pro-actively,’ he said.

Financial Reporting Requirements Obligations

ASIC is closely monitoring developments that may affect financial reporting requirements, talking to market participants and auditors, and considering possible impacts and responses. At present, there appear to be no widespread indications of any significant issues for entities in meeting their full-year and half-year financial reporting requirements obligations on 31 December 2019.

Entities With 31 March or 30 June Balance Dates

ASIC will carefully monitor how market conditions and COVID-19 are affecting financial reporting AGM and financial reporting requirements following Coronavirus obligations for these entities and may update this guidance if needed.

ASIC’s Formal ‘no-action’ Position on AGMs due by 31 May

Entities with a financial year-end of 31 December may find it difficult to hold their AGM by the deadline of 31 May 2020 due to the restrictions on large gatherings, travel restrictions and concerns from members about attending large-group meetings in the COVID-19 situation.

ASIC does not have the power to grant extensions of time to hold an AGM on a ‘class basis’, i.e. to all entities with a financial year ended 31 December 2019. We have therefore provided a ‘no-action’ position on upcoming AGMs that need to be deferred or that are held online.
Two-month extension by ‘no-action’ position ASIC has adopted a two-month no-action position for entities with a financial year-end of 31 December 2019 that do not hold their AGM by 31 May 2020. At present, these entities ideally will be able to hold their AGM by the end of July 2020, but the situation will remain under review.

This ‘no-action’ position means that ASIC will not take action against an entity with a financial year-end of 31 December 2019 that fails to comply with s250N(2) of the Corporations Act 2001 provided the entity holds the AGM by 31 July 2020 or such later date as ASIC advises (‘extension period’).

Hybrid and Virtual AGMs

Some entities may wish to proceed with holding their AGM by 31 May 2020 or during the extension period, using technology to comply with COVID-19 restrictions. This may include a ‘hybrid’ AGM (where there are a physical location and online facilities) or a ‘virtual’ AGM that is conducted solely online.

ASIC understands the benefit of hybrid and virtual AGMs in the current circumstances, including encouraging members to vote by proxy and participate electronically. In circumstances where a notice of the meeting has already been dispatched to members, we support entities sending supplementary instructions to their members electronically, on their website, and via a market announcement.

The legal status of hybrid and virtual AGMs

ASIC considers that hybrid AGMs are permitted under the Corporations Act but entities need to check whether their constitution restricts meetings being held in this way. ASIC does not have the power to modify the Corporations Act to facilitate hybrid AGMs where they are not permitted under an entity’s constitution.

There is some doubt as to whether the Corporations Act permits virtual AGMs and there may also be a doubt as to the validity of resolutions passed at a virtual AGM. ASIC does not have the power to modify the Corporations Act to facilitate virtual AGMs. However, we have provided a no-action position on virtual AGMs – see below. Entities should also consider whether they can hold a virtual meeting under their constitution.

Entities that are concerned about the validity of virtual meetings may wish to seek legal advice on section 1322 of the Corporations Act. Various irregularities associated with meetings held for the purposes of the Act are not invalidated unless the Court makes a contrary declaration. A person may be also able to apply to the Court for an order addressing other irregularities.

No-action position on virtual AGMs

ASIC intends to take a no-action position on non-compliance with provisions of the Corporations Act that may restrict the holding of virtual AGMs where an entity elects to hold a virtual AGM in order to comply with the statutory 31 May 2020 deadline or during the extension period.

This ‘no-action’ position on virtual AGMs is conditional on the technology providing members as a whole a reasonable opportunity to participate (sections 249S). In ASIC’s view, this would include:

• Members being able to ask questions of the auditor and about management.
• Voting occurring by a poll rather than a show of hands.

Entities should make an assessment of their AGM-facilitating technologies in advance of holding the meeting and consider whether it adequately addresses these conditions. If there are concerns, entities can instead postpone the AGM and hold it later in reliance on ASIC’s no-action position on deferred AGMs.

No-action on sending supplementary notices electronically

ASIC also intends to take no action on any contravention of the Corporations Act if an entity has dispatched a notice for a meeting to be held on or before 31 May 2020 and at least two business days before the meeting is held, the entity sends members supplementary instructions for on-line participation by:

• Electronic message (if the member has provided the relevant details).
• A notice on the entity’s website and
• A market announcement if the entity is listed on a market.

This ‘no-action’ position covers any failure of the supplementary instructions to comply with sections 249J of the Corporations Act.
What if the entity cannot facilitate online participation in their meeting?

Entities that have a constitution that restricts on-line participation in an AGM or that cannot otherwise provide effective on-line participation for logistical or technical reasons can also rely on ASIC’s ‘no-action’ position for deferral of AGMs. Postponing an AGM where an entity has made advanced preparation may cause significant cost and inconvenience, but holding an AGM where few members can participate either in person or online might not comply with the Corporations Act and produce an unsatisfactory outcome.

Note on status of ASIC’s ‘no-action’ positions for AGMs

ASIC’s general policy on ‘no-action’ positions and their status is set out in Regulatory Guide 108 No-action letters. In particular, it should be noted:

• A ‘no-action’ letter is an expression of regulatory intention about how to exercise ASIC’s powers. The purpose of a ‘no-action’ letter is to provide an indication as to the future regulatory action that we might take.
• An ASIC ‘no-action’ letter does not necessarily preclude third parties (including the Office of Director of Public Prosecutions) from taking legal action in relation to the same conduct or conduct of that kind. Nor does it prevent a court from holding that particular conduct infringes the relevant legislation. ASIC does not represent that the conduct covered by the ‘no-action’ letter will not be held to contravene the relevant legislation. Nor does ASIC undertake to intervene in an action brought by third parties in respect of such conduct.

For guidance on your obligations in this evolving space, please contact our experienced commercial law department on 1800 217 217.

Article Source: AGM and financial reporting

Civil Partnerships Become Registered Relationships

The Civil Partnerships Act 2012 was one of the last pieces of legislation passed by the previous session of Parliament, and it was very quickly amended by the Civil Partnerships and Other Legislation Amendment Act 2012, which was one of the first pieces of legislation passed by the new session of Parliament. There are three particular changes introduced by the later Act.

First of all the phrase, Civil Partnership has been replaced by the phrase Registered Relationship. So Queensland no longer has Civil Partnerships, it has Registered Relationships. Any couples who entered into Civil Partnerships before the legislation was amended have automatically been converted to Registered Relationships.

Secondly, the possibility of an official ceremony to celebrate a Registered Relationship has been removed by the amendments. This does not of course prevent informal celebrations, but an official ceremony is no longer a possibility.

The third change is a logical consequence of the second, with no official ceremonies there is no longer a need for Civil Partnership Notaries, which were provided for in the original legislation, and therefore the amendments take out the provisions dealing with that.

What may have been overlooked amongst recent media coverage is that Registered Relationships are available for couples of the opposite sex who choose not to get married as well as for same-sex couples. Entering into a Registered Relationship does have some legal consequences, although the more significant legal issues of property settlement and parenting arrangements remain the province of the federal Family Law Act.

For legal advice in relation to all family law matters, including de facto situations, property settlement, parenting, surrogacy, divorce, or Binding Financial Agreements (prenuptial agreements) please contact our partner Ian Field on 07 3236 0001 or by e-mail at ifield@aylwardgame.com.au

Article Source: Civil Partnerships 

Conveyancing – The Importance of Property Searches

When purchasing your property it is important that searches are carried out to check that the seller has met their disclosure obligations, that warranties in the contract are correct, and to obtain the information required to assist in your conveyance. It is important to ensure that all searches relevant to the purchase have been considered and that the appropriate searches are conducted at the correct stage of the conveyancing transaction.

Ideally, you should consider conducting searches in advance of signing your purchase contract or prior to the contract becoming unconditional to ensure the best understanding of the property you are signing up to purchase before being ‘locked in’ to settle.

Certain searches should be conducted at the start of your conveyance and others will be conducted over the course and at the end of the conveyance. Although it is ultimately your decision as to when to conduct the searches, we recommend you have us carry out searches as soon as possible so that you are aware of your legal obligations and rights before they possibly expire and are well informed of the condition of the property.

Common points to consider about your property purchase (although not limited to those listed) are the accuracy of the lot’s position, investigating the actual and surrounding location and whether there are any current or future developments planned, and investigating any illegal or incomplete building or extension works to ensure final approvals are in order.

You should speak to your solicitor to start to look at which search options are necessary for you and discuss any property concerns or inquiries you wish to make to ensure that the results will not affect your purchase and any current or future plans you have for the property.

As your solicitor, we will conduct all initial searches on your behalf and then carry out further searches during the course of the conveyance.

If you wish to obtain a copy of our Search Cost Matrix prior to signing your contract to start looking at which property investigations are available and recommended to be made then please contact Libby Dessaix at (07) 3236 0001 for a FREE complimentary copy of the Matrix relevant to the area your property is located in (applies for all suburbs located within Queensland).

https://www.aylwardgame.com.au/contact/

Article Source: Conveyancing 

Property Settlement After Divorce

Statistics show that in Australia at least one-third of relationships end in divorce or separation. Usually, we don’t find accurate information about property settlement after divorce or separation.

Different cases have different results. All cases are decided according to the given facts, and the result of each case is different.

Misconceptions about property settlement:

Each case of a property settlement after divorce has different results. We hear different wrong statements from our clients. Let’s have a look at the wrong divorce property settlement examples in Australia.

• Everything is divided equally: People think that the property is divided equally among both parties. The truth is that there is no such rule. Also, there is no mathematical formula for dividing property. It is decided according to the given facts.
• To get a property settlement you will have to go to court: This myth is also not true. There are only 5% of couples who have to visit the court. All other cases are resolved through mediation, or by a solicitor-to-solicitor negotiation. After they agree about dividing their assets, they write an application for consent orders and the court just approves the application. They don’t even have to go to court.

Can I apply for a property settlement if I was in a de facto relationship?

Recently there were no such rules for de facto relations.

But now Family Court and the Federal Court can make financial decisions for couples who were in a relationship.

How property is divided?

After divorcing in Australia property settlement is decided easily. But sometimes, you may have to visit the court. So, you must be prepared for it. Let’s know about the basic rules about divorce property settlement. The court does not have a formula for dividing the property. No one knows about the exact results of the case. The judicial officer will decide according to the given facts of your case.

The family law act 1975 has declared the general principles which are followed by the court while deciding financial disputes after the divorce, also there are rules for property settlement after the ending of a de facto relationship. See sections 79(4) http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fla1975114/s79.html

And 75(4) http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fla1975114/s75.html

To know about property settlements after divorce. If you were in a de facto relationship then you may look at 90SM(4) http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fla1975114/s90sm.html

And 90SF(3) http://www6.austlii.edu.au/cgi-bin/viewdoc/au/legis/cth/consol_act/fla1975114/s90sf.html

The basic rules are the same whether you were in a marriage or a de facto relationship.

• Working on the properties that you owe.
• What was the contribution of each party to the marriage or de facto relationship? For instance their salary.
• The court will also consider gifts and inheritances from each party or their families.
• The court would like to know about the non-financial contribution of each party, for example caring for children or homemaking.
• The court will look at future possibilities according to one’s health, financial status, custody of children, and whether he or she can have the ability to earn.

The division of assets will depend on your financial status. You may get more or less according to your condition.

What is the time limit for the application of property settlement?

Property settlement after divorce has a time limit. In case of a divorce you should for this application within 1 year of the divorce becoming final. If you were in a de facto relationship, it expands to two years after the breakdown of the relationship.

If you were not able to apply in the given you will have to get special permission from the court to apply this application.

Is it good to have a property settlement?

If your financial condition is not good then you should go for property settlement. But, the court has the authority to decide about property settlement. If the court finds that it is suitable to divide property then the court will not allow it.

It is all based on the given facts and circumstances. If the court decides not to allow property settlement then both parties will leave with the properties under their name and possession.

Explain the property pool:

In the property pool, all the assets and liabilities of both parties are included, it also includes assets in joint names. It can include a house, a townhouse, or a block of land. It can also be a business vehicle, motor vehicle, camper, boat, bank account, or shares, and nowadays bitcoin is also included. In liabilities loans like mortgage, personal loan, and business loan is added, also credit card, debt Australia is included in liabilities.

What about property sold after separation or divorce?

If a party sells one or more of its properties after divorce or separation, these properties are added back to the property pool. It is good to negotiate with the other person before taking such a step. The same procedure should apply if you purchase a new property.

How will financial agreements help?

These agreements are just like contracts. In these agreements, parties decide how they want to divide the property. The couples in a marriage or de facto relationship candy go for financial agreement. You can make these agreements before, during, or after your marriage.

If you are thinking of making such agreements then you should understand the terms and conditions of the agreement. Before signing the agreement you should receive legal advice. This agreement can save a lot of time. The property settlement after divorce gets easier if you have such an agreement.

How can Mackay family lawyers help?

At Mackay family lawyers we have the most experienced lawyers for divorce property settlement. We can deal with all kinds of property issues. We have made many satisfied clients. We can help you get your truth right.

A few more questions:

Here are some commonly asked questions about property settlement after divorce.

How divorce property settlement is decided?

The easy solution to this problem is that you should decide how to divide property by discussion. But most couples don’t agree with this solution so you will have to go to court. In court, the judge will decide according to the stats provided by both parties. The decision changes according to one’s financial status.

How can I apply for divorce property settlement after the deadline?

You will have to tell the court about the cause of the delay. You must show them that your life or the life of the child will get harder if the court does not allow you to proceed.

What is meant by Binding Financial Agreement?

The Family Law Act allows couples in a marriage or in a de facto relationship to agree to property settlement if their relationship breaks down. This agreement is called the Binding Financial Agreement. In this agreement, the court is not involved in any kind of property matters. The court is involved if this agreement is terminated by the parties.

Article Source: Property Settlement