9 April 2020 – The Czech Government has prepared several measures that should help companies in the challenging times stemming from the outbreak of COVID-19. Please find below a brief overview of proposed measures relating to the corporate governance of companies, final approval of which is expected shortly.
Remote decision-making of corporate bodies
Corporate bodies of companies will be able to adopt decisions outside of ordinary physical meetings by making use of correspondence voting or other technological means (e.g. videoconferencing), even if such remote decision-making is not permitted by the Articles of Association. Other statutory requirements (e.g. adequate identification of shareholders) remain in place, and company management and/or the respective body may need to approve adequate procedural rules in order to enable this possibility.
Extension of the term of corporate appointees
If the term of office of an appointed member of a corporate body is set to expire while extraordinary pandemic measures are in place or within one month after the measures have ended, the term of office will be extended by operation of law and will expire three months after the end of the extraordinary pandemic measures (unless the respective appointee refuses this prolongation in writing).
Extension of the deadline for Financial Statement approval
For non-listed companies, the statutory deadline for approval of the annual Financial Statements (typically six months after the end of the financial year) will be prolonged by operation of law, meaning approval can be delayed up to (i) three months after the termination of the extraordinary pandemic measures, or (ii) 31 December 2020, whichever occurs earlier.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.