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Legal background
Under article 548 of the Revised Uniform Act on Commercial Companies and Economic Interest Groups (AUSCGIE), the Annual General Meeting (AGM) must be held at least once a year, within six months of the end of the financial year, i.e. before 30 June each year. An extension of this deadline may be granted by a court decision upon the filing of a petition.
When a decision is taken by the court, it will set a precise deadline within which the AGOA must be convened.
New position of the Commercial Court
The Commercial Court has recently adopted a stricter position:
- No further extensions of time may be granted after the 30 June deadline under the informal procedure (ordonnance à pied de requête).
- After the 30 June deadline, a shareholder/partner will have to initiate adversarial proceedings. This action will require a summons from the Company’s legal representative as well as from the Company itself for reasons of enforceability.
Recommendations
This new position calls for increased vigilance on the part of companies and their governance bodies to ensure that:
– Either that AGMs are held within the legal timeframe (before 30 June);
– Or to file a request for an extension of the AGOA with the Court before 30 June.
In the event of a delay, action should be taken with the Commercial Court as soon as possible.