Increasing flexibility at the general meeting - virtual and hybrid execution
Since this year, general meetings can be held virtually, which brings much appreciated flexibility and aligns the corporate world with today’s digitalized reality.
The revised Swiss corporate law, which came into force on January 1, 2023, creates more flexibility in the conduction of general meetings of companies limited by shares (Aktiengesellschaft). The general meetings can now be held both virtually and in a hybrid version. In doing so, the legislator creates a step towards an alignment with the reality of today's digitalized startups. However, to make use of this new option, the articles of association must be adapted.
The virtual general meeting and its implementation
The term "virtual general meeting" refers to the purely digital execution of the general meeting through the transmission of sound and images. Under the new law, the board of directors can completely forgo the otherwise mandatory designation of a meeting location and shareholders as well as the chairman and the secretary can simply join the general meeting virtually.
The board of directors is free to pick the implementation tool of its choice. The new law merely stipulates that the board of directors must ensure that whichever tool is chosen, the identity of the participants is established, the oral contributions (such as votes and motions) are directly transmitted, that each participant can submit motions and participate in the debate and lastly, that the voting results cannot be falsified. However, if technical problems arise during the general meeting, so that the general meeting cannot be conducted properly anymore, it must be held again. Resolutions that have passed before the technical problems occurred remain legally binding. It should be noted however, hat personal IT or connectivity problems of the participating shareholders are not considered technical problems.
The hybrid general meeting
The hybrid or multilocal general meeting is a hybrid form of the – under previous law required – in-person-presence at a set meeting location and the new virtual execution explained above. In the case of the hybrid general meeting, the general meeting still takes place at a venue determined in advance, with the difference that the shareholders can choose for themselves whether they wish to be present on site or take part virtually.
Mandatory provision in the articles of association
If you would like to hold your general meetings virtually in the future, it is mandatory to include this option in the articles of association of your company. We are happy to assist you to make this possible. You can take the first steps yourself directly on our website by booking our legal package "general revision of articles".
Summary
The introduction of the virtual general meeting brings new flexibility, especially to companies with numerous shareholders or foreign residents. However, the implementation must be strategically planned in order to meet the requirements of the law, otherwise, the company exposes itself to the risk of contestability of all resolutions. In order to hold a virtual general meeting, the introduction of a provision in the articles of association is mandatory.
! Remember that even without the introduction of the provision for the virtual general meeting, the articles of association of all Swiss companies limited by shares must be adapted to the revised corporate law by December 31, 2024 at the latest. For further information and a personal consultation you can contact us at any time!