Securities and Exchange Commission of Pakistan issues coronavirus advisory

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) on Wednesday advised all companies to modify their usual planning for annual general meetings in light of the threat posed by the evolving COVID-19 situation to protect the well-being of shareholders, reported The News.

The advisory comes after one more case of coronavirus was confirmed in the country on Wednesday taking the nationwide toll to 20.

The SECP also suggested holding meeting of the board of directors via tele/video conferencing. SECP has recommended all companies to consider and evaluate the risks in the present situation. 

Every company is required to hold an annual general meeting (AGM) within sixteen months from the date of its incorporation and thereafter once in every calendar year within a period of 120 days following the close of its financial year.

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As AGM season for companies is approaching, the directors and secretaries should modify their usual planning for their company’s AGM in light of the threat posed by the evolving COVID-19 situation, the SECP said in a statement. 

“Directors should consider if members can consolidate their attendance and voting at AGMs into as few people as possible through proxies, while honouring quorum provisions.”

In order to avoid large gathering at one place, the companies should consider provision of video link facilities at different locations considering the geographical dispersal of its members.

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The companies should consider basic protective measures during the meeting, including facility of cleaning hand with sanitizers or soap and water. Moreover, for safety of members seating arrangement should be made at an appropriate distance, the SECP said. 

It also suggested considering postal ballot for voting by the chairman of the meeting or by the members present in person or through video-link or by proxy having not less than one-tenth of the total voting power by demanding poll for resolutions. This was a safer option in the current situation.

“The members of a private company or a public unlisted company (having not more than 50 members), may pass a resolution (ordinary or special) by circulation signed by all the members for the time being entitled to receive notice of a meeting, except for the ordinary businesses specified under sub-section (2) of section 134 of the Companies Act, 2017 to be conducted in the annual general meeting.”

Originally published in The News