8 November 2006
520.The provisions in this Part replace most of Chapter 4 of Part 11 of the 1985 Act on meetings and resolutions. The changes in the law derive principally from the CLR’s consultation on “Company General Meetings and Shareholder Communications” and recommendations from Chapters 2, 6 and 7 of their “Final Report”, together with two subsequent consultations; the Modernising Company Law White Paper of July 2002 and the Company Law Reform White Paper of March 2005.
521.In addition to implementing detailed policy changes, Part 13 implements two general changes.
First, the law makes the current “elective” regime the default for private companies. This means, for instance, that private companies will no longer need to “elect” to dispense with the Annual General Meeting (AGM): they will not be required to hold an AGM in the first place.
Second, the current law is drafted on the basis that the main way in which shareholder decisions are taken is in general meetings. The new provisions proceed on the basis that in future this will not be the case for many private companies. Private companies will not be required in future to hold general meetings; instead provision is made for new procedures for decisions to be taken by written resolution.
522.The law relating to decisions has been restated in a way that deals first with private companies. Additional layers of requirements for public and quoted companies holding general meetings follow in subsequent provisions. There are provisions at the end of the Part about record keeping. In general, where this Part imposes an obligation or confers a power, it will apply notwithstanding anything in the articles unless otherwise indicated.