Every director and shareholder should be aware of certain annual corporate maintenance requirements. We recently discussed the requirement to file annual reports. Today we will look at the annual general meeting “(AGM”) requirements for BC companies.
AGM requirements: When must an AGM be held?
If your company is incorporated in BC, the Business Corporations Act, SBC 2002, c. 57 (the “Act”) governs timing requirements for AGMs:
- A BC company must hold its first annual general meeting within 18 months of the date it was recognized. This is the date the company was incorporated, amalgamated, or continued in BC, and is referred to as its “annual reference date.”
- After the first AGM, the company must hold an AGM at least once in each calendar year and not more than 15 months after the preceding AGM or annual reference date.
A “quorum” must be present for business to be transacted at any AGM. The company’s memorandum or articles will specify the minimum number of voting shareholders needed for an AGM to proceed—if they do not, the defaults for quorum in the Act apply.
Can the company defer, waive, or conduct the AGM in writing?
Shareholders have the right to defer the date of an AGM or to waive the holding of that meeting or any earlier AGM the company was required to hold. Unanimous resolution of all voting shareholders is required to do so. The Act also allows BC companies to pass annual consent resolutions in lieu of holding an in-person AGM. BC companies opt to proceed by written resolution to avoid the necessity of a physical meeting. For this to occur, all shareholders entitled to vote at the AGM must consent in writing to all of the business to be transacted at that AGM.
What business is conducted at an AGM?
The following matters form part of the normal business at an AGM for a private company in BC:
- Presentation of Financial Statements: the directors present the company’s annual financial statements, prepared in accordance with the Act, for approval by the shareholders.
- Appointment of Auditor: shareholders must appoint an auditor by each annual reference date unless all the shareholders (whether or not their shares normally carry the right to vote) waive this requirement by special resolution.
- Election of Directors: directors are elected or appointed at the AGM. The Act and the company’s articles govern elections and appointments. It is often the case that directors must retire at each AGM but are eligible for re-election.
Any specific matters to be discussed or other business to be conducted should be set out in the notice of AGM. Several other elements may be added to an AGM agenda.
Who should I contact for guidance and legal advice?
For guidance on corporate AGM requirements in BC, contact our experienced corporate lawyers. We are here to provide you with practical knowledge and clear legal advice.