Government has confirmed that co-operative and community benefit societies, in Great Britain and Northern Ireland, are covered by legislation that provides businesses with greater flexibility in how and when they hold their Annual General Meetings (AGMs), or any other General Meetings (GMs) until 30 April 2021.
We know AGMs are right at the heart of member democratic control in co-ops and community businesses. We also know that because of COVID-19 and social distancing, our members have faced a number of dilemmas regarding how and when to hold their AGMs.
Legal clarity and comfort
Back in March government announced it would be legislating to give companies greater flexibility in how they approach AGMs and GMs. We worked with government to ensure legislation was extended to societies in a useful way.
The legislation gives societies legal certainty and comfort if they need to breach their rules, and usual good co-operative practice, by:
- Holding their AGMs and GMs in ways that restrict in-person participation
- Holding their AGMs and GMs with online participation
- Delaying their AGMs and GMs
The legislation initially provided this period of legal certainty and comfort up to the end of September 2020. Government has now confirmed that legislation has been extended to 31 March 2021, for societies in Great Britain and Northern Ireland. The legislation will also apply retrospectively from 26 March, so any AGMs and GMs societies held from that date onwards are covered.
The Department for Business, Energy and Industrial Strategy and the Financial Reporting Council have updated their information sheet to reflect the fact that societies are now going to be included. We advise society secretaries to read this document carefully.
Government has introduced new insolvency legislation to give businesses in distress more opportunities to turn things around. Following our successful lobbying, these reforms now apply to co-operative and community benefit societies as well as companies. Read a summary of the changes and get our guidance for societies facing financial strife.
We have also been trying to get government to legislate to temporarily extend the statutory deadline for societies to file their accounts with the Financial Conduct Authority. Unfortunately we have not been successful in this. Government takes the view that the statement provided the FCA offering leeway to societies who breach the statutory filing deadline is sufficient.