New rules on holding general meetings electronically
Annual General Meeting season is underway in Oman and the Capital Market Authority of Oman has responded to the restrictions brought about by social distancing in the light of COVID-19 with a defining set of rules to assist public joint stock companies and investment funds in holding general meetings “virtually”.
The rules are set out in the Capital Market Authority’s Decision number E/25/2020 (“Rules”) and the key themes are stated below:
- Electronic voting: shareholders and unit holders may vote using the company’s (or fund’s) electronic platform up to three days prior to the date of the meeting. The Rules stipulate that the electronic platform used for voting will safeguard confidentiality of the vote until the meeting calls for a vote on the specific resolution in questions;
- Time limit on voting: voting time is limited to five minutes per agenda item (ten minutes for the election of directors). These time restrictions are to ensure the meeting is not delayed unnecessarily by any limitations caused by the members being present virtually and in person;
- Quorum: shareholders and unit holders may elect to participate at general meetings in an electronic forum and if such shareholders choose to participate electronically, they will form part of the quorum of that meeting provided they are present and logged into the electronic platform at the start of the meeting;
- Proxies: only juristic shareholders have the right to appoint a proxy to attend the meeting and vote electronically. Natural persons must still attend in their own name (in person or electronically);
- Director nominations: Board of director nominations must be submitted to the company or fund (as applicable) at least five days prior to the meeting. The company or fund must then submit the approved candidates to the Muscat Securities Market at least three days prior to the date of the meeting;
- Company secretary: the name of the person that will act as secretary of the general meeting will be submitted in advance to the Muscat Clearing and Depository Company to enable voting to take place on the secretary’s appointment; and
- Changes to agenda: The Rules also suggest that if a shareholder or unit holder (as applicable) votes in a particular manner based on the agenda that was previously posted / made available to shareholders and the agenda is subsequently amended on the actual date of the meeting, a shareholder or unit holder (as applicable) may change their vote on the date of the meeting.
The Rules make clear that voting electronically is treated in the same way as being personally present, the latter of which is still available to those who wish to be physically present at the meeting. The effect of this is that votes that are cast electronically remain binding on the company. The voting platform will be provided by the Muscat Clearing and Depository Company which will manage the calculation of votes in respect of each agenda item.
All public joint stock companies must implement the electronic voting platform for their upcoming annual general meeting and shareholders will need to ensure that their details registered with the Muscat Clearing and Depository Company are accurate to ensure that they are able to access the electronic portal efficiently.
How can we help?
Al Tamimi & Company’s market leading corporate commercial practice in Oman is available to act as legal representative at your general meetings, as required by the Capital Market Authority rules and regulations. We would be pleased to provide further guidance on the electronic platform that has been implemented by the Muscat Clearing and Depository Company.