Governing bodies’ remote meetings will continue to be allowed in 2021

Royal Decree Law 2/2021, of January 26, (RD-L 2/2021) allows governing bodies and executive committees of corporate enterprises to hold remote meetings during 2021 even if they are not provided for in the bylaws. At the chairperson’s request, these bodies may also adopt their resolutions in writing and without holding a meeting.

Governing bodies’ remote meetings will continue to be allowed in 2021
January 29, 2021

Royal Decree Law 2/2021, of January 26, (RD-L 2/2021) allows governing bodies and executive committees of corporate enterprises to hold remote meetings during 2021 even if they are not provided for in the bylaws. At the chairperson’s request, these bodies may also adopt their resolutions in writing and without holding a meeting.

Royal Decree Law 34/2020, of November 17, (RD-L 34/2020) allowed corporate enterprises (including listed companies) to continue holding remote general meetings during 2021, even if they are not provided for in the bylaws. It did not mention governing bodies, which under article 40(1) of Royal Decree-Law 8/2020 could meet remotely during 2020, even if this was not provided for in the bylaws.

RDL 2/2021 was published in the Official State Gazette on January 27 and entered into force immediately. Its seventh final provision added a fourth paragraph to article 3 of RDL 34/2020.

As a result, article 3(4) of RDL 34/2020 now allows corporate governing bodies to hold video or telephone conference meetings during 2021, even if they are not provided for in the bylaws, as long as: (i) all members of the governing body have the necessary means to attend; and (ii) the secretary recognizes all of these members and states that he/she identifies them in the minutes of the meeting, which must be sent immediately to all attendees via email. The same rule applies to mandatory or voluntary pre-established committees. The meeting will be considered held at the entity’s registered office. In practice, many listed companies’ bylaws and regulations already allow their boards of directors and committees to hold remote meetings.

In 2021, governing body resolutions may be adopted by a written vote and without a meeting (i) if the chairperson so decides; or (ii) at the request of two directors. The same rule applies to mandatory or voluntary pre-established committees.

Although listed companies do not usually follow this procedure, this exceptional measure would allow for the adoption of written resolutions without a meeting and without recording the opposition of board members, as required by article 248(2) of the Corporate Enterprises Act.

January 29, 2021