On January 26, 2023, the Hong Kong Government introduced legislation, the Companies (Amendment) Ordinance 2023 ("Virtual Company Meeting Ordinance"), to amend the Companies Ordinance to facilitate the holding of virtual company meetings. The amendments will become effective April 28, 2023. If you would like more information about this new legislation or Hong Kong company law generally, please contact one of our corporate lawyers.
The Virtual Company Meeting Ordinance supplements existing provisions of the Companies Ordinance which permit a company to hold a general meeting at 2 or more places using any technology that enables the members of the company who are not together at the same place to listen, speak and vote at the meeting. These existing provisions do not however, eliminate the need for a physical location for a meeting.
The new legislation addresses this gap, amending provisions of the Companies Ordinance relating to general meetings and the Companies (Model Articles) Notice to establish a mechanism for holding general meetings using virtual technology. Shareholder meetings of companies may, for example, now be held through Zoom, Google Meets, Microsoft Teams or other virtual meeting technology or through a combination of a physical meeting and a virtual meeting using such technology.
The new legislation respects any specific provisions in a company’s articles of association for virtual meetings which such a company may have already adopted or may in the future adopt. The new legislation simply establishes default provisions which may obviate the need for such specific articles.
At the core of the legislative amendments is a new definition of “virtual meeting technology”, which the Virtual Company Meeting Ordinance defines as “a technology that allows a person to listen, speak and vote at a meeting without being physically present at the meeting.”
Under the Virtual Company Meeting Ordinance, subject to its articles of association, a company may hold a general meeting at a physical venue, by using virtual meeting technology or both at a physical venue and by using virtual meeting technology.
For avoidance of doubt, the legislation provides that a provision of the company’s articles requiring a notice of a general meeting to specify the physical venue of the meeting is not in itself a provision that requires a general meeting to be held only at a physical venue and thus, overrides the above default provision.
Though the new legislation is silent on how companies should decide whether to adopt virtual meeting technology, guidance issued by the Companies Registry recommends the use of such technology to hold meetings at a time that is convenient to the largest possible number of members and to promote engagement and participation with members. The guidance specifically warns that virtual meetings should not be deployed as a means to limit the ability of members to participate in general meetings. With this in mind, the guidance goes on to recommend that companies take steps to manage risks of inadequate or unstable internet connectivity and to consider capacity requirements, the availability of technical support and the means to verify identity of participants and to authenticate voting.
Where a company intends to hold a meeting wholly or partly through virtual meeting technology, the notice must specify the virtual meeting technology to be used..
Though the legislation itself does not so specify, guidance issued by the Companies Registry recommends the notice include:
description of the functionality of the technology (e.g. whether the technology will allow members to ask questions orally and in writing),
system requirements for the technology, including hardware and software,
login or pre-registration information,
instructions for access to relevant meeting documents (including proxy forms and corporate representative appointment forms),
technical support options, and
means to cast votes.
Under the Virtual Company Meeting Ordinance, a person who attends a general meeting by using the virtual meeting technology specified in the notice of the meeting is to be regarded as being present while so attending.
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