SEC Chair Emilio Aquino
The Securities and Exchange Commission (SEC) has approved the guidelines for remote participation in corporate meetings in support of an expanded community quarantine to contain the coronavirus (COVID-19) pandemic.
The guidelines, issued through SEC Memorandum Circular No. 6, Series of 2020 on March 12, immediately took effect upon approval by the SEC En Banc.
The SEC will now allow corporations to conduct meetings through teleconferencing, video conferencing and other remote or electronic means of communications. This is for the purpose of approving provisions in bylaws or internal procedures, which will govern participation in board meetings and stockholders’ and members’ meetings.
“The guidelines support the President’s declaration of a state of public health emergency throughout the Philippines to contain the outbreak of the new coronavirus disease, COVID-19,” SEC chair Emilio Aquino said.
“Aside from allowing directors, trustees, stockholders or members to participate in meetings through remote communication to minimize face-to-face interactions, the Commission encourages corporations to explore and implement all necessary measures to prevent the further spread of COVID-19.”
Under the guidelines, the corporate secretary may send notice of meetings to directors or trustees through email, messaging services or such other manner provided in the corporation’s bylaws or by board resolution.
The company must develop the internal procedures for the conduct of board meetings through remote communication or other alternative modes to address administrative, technical and logistical issues.
Directors or trustees who intend to participate in a meeting through remote communication must notify in advance the presiding officer and corporate secretary.
During stockholders’ or members’ meetings, the written notice of meetings may likewise be sent to stockholders or members through email or such other similar manner as may be provided in the corporation’s bylaws.
Stockholders or members must notify in advance the presiding officer or corporate secretary of their intention to participate through remote communication. Those who participate through remote communication or in absentia will be deemed present for purposes of attaining quorum.
The right to vote of stockholders or members may also be exercised through remote communication or in absentia, when authorized by a resolution of the majority of the board. The resolution, however, will only be applicable for a particular meeting.
In corporations vested with public interest, stockholders or members may vote through remote communication or in absentia in the election of directors, trustees and officers notwithstanding the absence of a provision in the corporation’s bylaws.