As expected, perhaps driven by the situation we are facing as a result of COVID-19, which has led to the need to establish as an extraordinary and temporary measure the possibility of holding shareholders’ and partners’ meetings telematically and without the need to be provided for in the bylaws, the Capital Companies Act has finally been amended with regard to telematic attendance and holding of telematic meetings.

This amendment was carried out through Law 5/2021, of April 12, which amends the revised text of the Capital Companies Act, approved by Royal Legislative Decree 1/2020, of July 2, and other financial regulations, with respect to the promotion of long-term shareholder involvement in listed companies.

Although the main purpose of said Law is to transpose into Spanish Law Directive (EU) 2017/828 of the European Parliament and of the Council of 17 May 2017 amending Directive 2007/36/EC as regards the promotion of long-term shareholder involvement in listed companies, the fact is that it has also been used to amend Article 182 and to add a new article, 182 bis to the Capital Companies Act.

As a consequence of the aforementioned amendment, which will enter into force on May 3, 2021, Article 182 of the Capital Companies Act will now read as follows:

“Article 182. Telematic assistance.

If the bylaws provide for the possibility of attending the meeting by telematic means, duly guaranteeing the identity of the subject, the notice of meeting shall describe the deadlines, forms and methods of exercising the rights of the shareholders provided by the directors to enable the proper conduct of the meeting. In particular, the directors may determine that the interventions and proposed resolutions that, in accordance with this Law, those who intend to attend by telematic means, shall be sent to the company prior to the constitution of the meeting. Responses to shareholders or their representatives who, attending telematically, exercise their right to information during the meeting shall be made during the meeting itself or in writing during the seven days following the end of the meeting.”

It should be recalled that prior to Law 5/2021 (and until its entry into force), the possibility of telematic attendance at the meetings was only provided for by the Capital Companies Act, in Article 182, for public limited companies. Nothing was said about this possibility for other types of capital companies, which did not mean that it was not being interpreted extensively and by analogy for the rest of the companies, without prejudice to the legal uncertainty that such an extension could cause.

With the amendment introduced by Law 5/2021 to Article 182 of the Capital Companies Act, the express reference to “public limited companies” in said article is eliminated and the term “shareholders” is replaced by the term “partners”, thus removing any need for extensive interpretation and legal uncertainty. In other words, the possibility of telematic assistance is opened up for all types of capital companies (public limited company, limited liability company and limited partnership by shares). However, the need for the possibility of attending the meeting by telematic means to be included in the company’s bylaws is still maintained.

On the other hand, Article 182 bis has been added to the Capital Companies Act, which has the following wording:

“Article 182 bis. Meeting exclusively by telematic means. 

  1. In addition to the provisions of the preceding article, the bylaws may authorize the call by the directors of meetings to be held without the physical attendance of the shareholders or their representatives. As not provided for in this provision, exclusively telematic meetings shall be subject to the general rules applicable to face-to-face meetings, adapted as the case may be to the special features deriving from their nature.
  2. The amendment to the bylaws authorizing the calling of exclusively telematic meetings must be approved by shareholders representing at least two thirds of the capital present or represented at the meeting.
  3. The holding of the meeting exclusively by telematic means shall be subject in all cases to the identity and legitimacy of the shareholders and their representatives being duly guaranteed and to all attendees being able to effectively participate in the meeting by means of appropriate remote communication media, such as audio or video, complemented by the possibility of written messages during the course of the meeting, both to exercise in real time the rights to speak, information, proposal and vote that correspond to them, and to follow the interventions of the other attendees by the necessary measures in accordance with the state of the art and the circumstances of the company, especially the number of its partners.
  4. The notice of call shall inform of the formalities and procedures to be followed for the registration and formation of the list of attendees, for the exercise by the latter of their rights and for the proper reflection in the minutes of the proceedings of the meeting. Attendance may in no case be conditional upon registration being made more than one hour prior to the scheduled start of the meeting.
  5. Responses to shareholders or their representatives exercising their right to information during the meeting shall be governed by the provisions of Article 182.
  6. The exclusively telematic meeting shall be deemed to be held at the registered office, regardless of where the chairman of the meeting is located.
  7. The provisions contained in this article shall be equally applicable to the limited liability company.”

The introduction of this article in the Capital Companies Act opens up the possibility of meetings being held exclusively telematically, i.e. without the physical attendance of any of the shareholders or their representatives.

It should be recalled that, apart from the amendments introduced by Law 5/2021 regarding telematic meetings, the possibility of attending meetings telematically remains in force throughout 2021 (extraordinary measure ant Covid-19), even when this possibility is not provided for in the Company’s bylaws.