The Chartered Governance Institute has published guidance on contingency planning for AGMs during the current COVID-19 outbreak which reflects the government’s ban on public gatherings of more than two people.
The guidance offers suggestions for how UK listed companies might operate contingency plans including how to ensure meetings are quorate, who chairs meetings, which directors would be expected to attend and to encourage members to vote by proxy. Companies should look to their own articles of association as well as UK company law and regulations in addition to considering this guidance.
The original guidance, published on 17 March 2020, and supplementary guidance published on 27 March 2020 are available here.
Publication of annual audited accounts
The London Stock Exchange (LSE) announced temporary changes to AIM companies’ reporting obligations for publishing annual audited accounts, to take effect from 26 March 2020.
The temporary measures have been announced following a joint initiative of the Department of Business, Energy and Industrial Strategy and Companies House to allow UK companies to make an application to extend the legal filing application by three months.
In normal circumstances AIM companies must publish annual audited accounts six months after the end of their financial year. In order to assist in preparing company accounts in the current circumstances, AIM companies can now apply for a three-month extension to the reporting deadline for publication of their annual audited accounts under Rule 19 of the AIM Rules for Companies (AIM Rules).
The extension will be available for AIM companies with financial year ends between 20 September 2019 and 30 June 2020, and should be made to the AIM Regulator by the company’s nominated adviser (nomad), prior to the AIM companies’ current reporting deadline under the AIM Rules.
This temporary measure will be kept under review by AIM Regulation and any changes to this will be published on the LSE website.
Temporary changes to the application of certain rules
AIM regulation has announced that, until further notice, it will be applying discretion on the application of certain AIM Rules and AIM Rules for Nominated Advisers (AIM Nomad Rules) as detailed below.
Temporary suspension of trading
Given the importance of timely and accurate disclosure, all AIM companies should continue to meet all disclosure obligations in a timely manner and without delay. Nomads are expected to understand how their companies are dealing with the current situation and whether they are able to continue to comply with their disclosure obligations under the AIM Rules. If AIM companies are facing material difficulties as a result of current coronavirus-related challenges and are consequently unable to comply with their disclosure obligations and require additional time to do so, nomads will be able to approach AIM Regulation to discuss whether a temporary suspension of trading is required. The nomad can make a request for a suspension but such request will need to fully explain why the suspension is appropriate. Any decision to suspend will be at the discretion of AIM Regulation. If granted, temporary suspension will be for a limited period to enable the company to make a fully compliant notification.
Suspended AIM companies
Where an AIM company has been suspended for more than six months, AIM Rule 41 denotes the company’s securities will be cancelled. Under AIM Regulation’s new discretionary measures, the AIM securities period of suspension will be extended from six to twelve months to allow companies time to resolve the reason for its suspension.
This new measure will apply to AIM securities suspended between 30 September 2019 and 1 July 2020.
Engagement responsibilities for a nomad
Where a nomad takes on a new client, under AIM Nomad Rules, the nomad is expected to visit the company in person and conduct a site visit as part of the due diligence process. AIM Regulation have advised this requirement is temporarily suspended, allowing nomads to make use of alternative measures, such as virtual meetings. This will also apply to directors’ education.
LSE have advised these temporary measures will be kept under review and provide further guidance as necessary.
'...In order to assist in preparing company accounts in the current circumstances, AIM companies can now apply for a three-month extension...'
