Will the shareholder meeting held via video conference have legal effect?

COVID-19 spread has led to the holding of shareholder meetings via video conferencing or remote methods, and you have requested legal advice regarding whether this is legally effective. Based on this legal opinion, it only covers general legal facts and if you require accurate legal advice, please contact Law firm Veat.

Law firm Veat’s expert opinion

Shareholder meetings are occasions where shareholders holding stock gather to discuss and decide on major matters, as stipulated by the Commercial Code, therefore they must be conducted in compliance with the relevant procedures and requirements.

Currently, under the Commercial Code, there are three ways a shareholder can exercise voting rights without directly attending a shareholder meeting:

① Exercising voting rights through a proxy

② Submitting a written request before the shareholder meeting, if the shareholder meeting is held in a specific location and the shareholder attends in accordance with the procedures.

③ Exercising voting rights through electronic means.

There are a total of three methods.

Article 391 of the Commercial Code allows the board of directors to participate in decisions via telecommunications means with all directors simultaneously transmitting and receiving audio, except where the articles of incorporation specify otherwise.

However, this regulation applies only to the board of directors. It is impossible to hold a “remote (including video conferencing) shareholder meeting” in which shareholders attend in real-time via telecommunications means instead of holding a shareholder meeting in a specific location, based on the current Commercial Code.

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Law firm Veat.