| Lowering threshold to demand poll
[amendments to section 178]
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The percentage threshold applicable to the right to demand a poll is 10% of the voting rights of members having the right to vote, or 10% of the total sum paid up on all the shares conferring that right. |
The percentage threshold is lowered from 10% to 5%.
Reasons for amendment
- There is no compelling reason to maintain the 10% threshold, if shareholders holding less than 10% have the power to call for a poll under the alternative 5-member threshold under section 178(b)(i) of the Act
- Lowering the threshold to 5% would be consistent with the 5% threshold adopted for the purposes of notification of substantial shareholdings in respect of listed companies.
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| New multiple proxies regime for indirect investors and CPF members
[amendments to section 181]
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Unless the articles of a company provide otherwise, a member of a company can only appoint up to 2 proxies who can only vote by poll.
There is a 48-hour cut-off time before the meeting for submission of proxy form.
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Certain specified intermediaries can appoint more than two proxies:
(a) banks or wholly-owned subsidiaries banks, whose business includes the provision of nominee services;
(b) a person holding a capital markets services licence to provide custodial services for securities under the Securities and Futures Act; and
(c) CPF Board.
Proxies appointed by such specified intermediaries can vote on a show of hands
Cut-off time for submission of proxy form extended from 48 hours to 72 hours.
6-month grace period granted to companies to give them time to implement changes to take into account possibly larger numbers of attendees for meetings.
Reasons for amendment
- Facilitates indirect investors attending and voting at shareholders’ meetings as proxies.
- Enhances corporate governance and encourages shareholder participation.
- Longer cut-off time so that companies have more lead time to process proxy submissions and handle administrative matters.
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| Liberalising electronic transmission of notices and documents
[New section 387C]
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Companies may transmit documents and notices by electronic means subject to certain conditions stated in the Act.
For publication of notice or documents via a website, there is a need for:
(i) the company and the member to agree in writing to such mode of transmission;
(ii) agreement must be in relation to the meeting to which the notice relates or to the document being transmitted;
(iii) the notice or document must be published on the website such that it is or can be made legible;
(iv) the member must be notified of the publication and how notice or document may be accessed; and
(v) the notice must continue to be published until the conclusion of the meeting.
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The procedures for a company’s use of electronic transmission have been reduced and made simpler. Companies may specify the means of electronic transmission in its constitution.
A company’s constitution can provide for electronic transmission to be the default mode of communication with members.
Safeguards will be provided in regulations, e.g.:
(i) Where member has an option to ask for physical copies, he must be notified of the option.
(ii) If documents are published on a website, the company must notify members by such means specified in the company’s constitution.
(iii) Important documents such as those relating to takeovers and rights issues must still be sent to members in physical copy instead of electronically.
Reasons for amendment
- Increases efficiency and speed in communications for companies.
- Reduce cost for companies in sending out documents and notices to their members.
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