‘The outbreak of the Covid-19 pandemic has a serious impact on companies and cooperative societies, including SEs and SCEs. In particular, due to the confinement and social distancing measures, as well as to the need to concentrate their efforts on managing the economic activity constraints, SEs and SCEs face considerable difficulties to respect the deadline to hold their general meeting referred to in Article 54 of their respective regulations'.
These words appear in the explanatory memorandum of a Proposal published by the European Commission on 29 April 2020 for a Council Regulation on temporary measures concerning the general meetings of European Companies (SEs) and of European Cooperative Societies (SCEs). By way of background, Article 54 of both Regulation (EC) No 2157/2001 of the European Parliament and Council of 8 October 2001 on the Statute for a European Company (SE Regulation) and Regulation (EC) No 1435/2003 of 22 July 2003 on the Statute for a European Cooperative Society (SCE Regulation), provides that SEs and SCEs must hold a general meeting at least once each calendar year, within six months of their financial year end, without exception. Acknowledging that Member States’ emergency company law measures in light of Covid-19 do not address entities such as SEs and SCEs, the proposed regulation provides a temporary derogation to such prescriptive timeframes. It extends the deadlines for general meetings to be held in 2020 to within twelve months of the relevant financial year end, but in any case, not beyond 31 December 2020.
The regulation which will be directly applicable in all Member States, will enter into force on the day after its publication in the Official Journal of the European Union.
No doubt this type of relief will be welcomed by Irish registered SEs and SCEs and we will be closely monitoring whether the Irish legislature will introduce similar relief for other Irish registered companies.
We will keep you updated.
This article was authored by Fergus Bolster and Ursula McMahon.